10 Lifestyle Investments to Avoid

lifestyle investment

One of the selling tactics that I have been hearing more and more these days is to make purchases as a “lifestyle investment.” The entire term bothers me in a number of ways, but the worst part is be bringing in the word “investment” into the dialog, the salesperson is trying to make you believe that these purchases will somehow pay-off like traditional investments do.

The truth is that they will have the exact opposite effect and drain your wallet faster than most purchases. In fact, most (but not all) of these “lifestyle investments” are depreciating assets that lose a great deal of value once the purchase has been made. These are the types of items wh


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6 Responses to 10 Lifestyle Investments to Avoid

  1. jay says:

    Every time I *attempt* to watch a show like “House Hunters” I start ranting at the folks who “need” a bigger house for their clothes/toys/stuff … why not pare down your stuff instead?

  2. Denise A. says:

    I have a ‘lifestyle investment” for you, do not spend your money on things that you don’t really need. Be a bargain shopper. Go to the library. Be happy with what you have. Reuse and up cycle. Decide to be happy if at all possible, because sometime as we all know life hands us impossible situations.

  3. Gailete says:

    >>No one truly needs to buy a $1,000 watch or $10,000 purse. <<

    At a Dr. office one day, glancing through a magazine I came upon a $18,000 Purse!!!!!!!!!!!! That is three times what we paid for our car. Who wants to carry around $18,000 on their arm and it was a hideous purse besides!!

    My SIL moved and they ended up renting a small apartment for a while waiting for their house to be finished. They insisted that where they were moving to 11 years ago didn't have any homes for less than $250,000. They lived in the house for at least 4 years before they even had furniture for one of the rooms (so obviously not using it). Why buy a hosue with more rooms than you will use? Of course, other BIL lived about a mile away form them in a modest ranch house. They wanted a McMansion but everyone seems embarrassed to say so, so they insist that there isn't anything else to buy.

  4. JoeP says:

    There are (at least) two factors that people ignore when buying a large house.

    First is furnishing, because good furniture is expensive, and typically paint, window treatments, and carpeting go along with this.

    The second is ongoing maintenance. While it might not seem like a big deal, it really can be. Bigger homes have more “parts” inside and out, and with more, these require more frequent repair. Our house isn’t huge, but I’m finding myself a little too busy with: lawn, gardens, trees, siding, drainage, windows, gutters, lights, furniture repairs, door repairs, garage cleaning, basement cleaning. Granted, these are common across most homes, but bigger homes need lots of labor.

    Also beware of some tech products. You can find yourself on a slippery slope when you buy a certain product that supports something you don’t have; for some, this opens the door for buying such products. For example, buying a home theater amplifier with bluetooth capability might entice someone to buy a lot of bluetooth devices.

  5. Linda says:

    In my opinion the most important item is family that shows you unconditional love. Beautiful homes, cars, watches jewerly etc are just things. You will be overjoyed when you first get them. But over time the ZING will go. But with family, and the love between them, you will find good mental health. And in my opinion, that’s on the very top of the list.

  6. Robert Dunn says:

    This is a great point and mostly right. I do think there are some exceptions that can be discerned if you’re objective about it though.

    To me the more legitimate interpretation of “Lifestyle Investment” is that you put money into something that has some investment value and some lifestyle benefit and that you are reducing the return of the investment to receive the lifestyle benefit.

    For example, there are beach condos run like hotels in lots of places where the units are owned and maintained by individuals who purchase them. From what I have seen it is not uncommon to garner enough income to cover all expenses (condo fees, insurance,maintenance, property taxes etc.) and maybe even net a small profit even using the unit a month or two a year.

    So the return is really “free use” where the real cost is the opportunity cost of putting the money used to purchase the condo into another investment. Those numbers can work if there is someplace you like to frequent, especially if you value the intangibles that usually come with ownership like locked owners closets (vacations without packing!), having a unit set up precisely ideally for you and your family, some extra access to common areas (like the right to keep a boat in the parking lot) etc.

    Again, lots of awful investments being touted, but the basic idea of “lifestyle investment” is not innately a bad one if you approach it with the right considerations in mind.

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