written by
on 2024-12-27
How much does your phone really cost?
Price
Let's just say, for this discussion, that the price of your phone is:
$300
What you pay
The amount you pay is: Price + Sales Tax
Sales Tax (let's assume 0.08%) = 300 * 0.08% = $24
You pay: $300 + 0.08% = $324
How much did you have to earn to buy the phone?
You have to earn more than $324 since you pay income tax as well. For this thought, let's assume a 15% income tax.
$324 / (1–0.15) = $381
What if you didn't buy the phone and saved the money instead?
A simple hack to estimate what this would be worth in 30 years if invested is to *10.
If you didn't buy the $300 phone, you would be $3,810 wealthier in 30 years!
Note
- When you find things that add value to your life. Buy them. But, think of everything you buy as an investment. How will that one thing return value to you every day or every year?
- You are also making an investment every time you choose NOT to buy something. The investment is in yourself. By saving and investing that money, you shorten the time it takes to reach real freedom.