Why Buy an iPhone when You Could Have $11,553?
The True Cost of an Apple iPhone
While I myself am not opposed to splurging on something fun once in a while, the iPhone takes this spending to a whole new level. Ranging in price from $500-$800 depending on which model and on where and if you are able to locate one, the iPhone represents more than a simple high-tech toy. It is a downright waste of money for all but the wealthiest of consumers. It took me several months to get my own emergency savings and Roth IRA accounts to the level of $800 after my necessary expenses like rent, etc., and I can't imagine throwing all that money away on something as frivolous as an iPhone.
I would put money on the fact that those people who are whipping out their wallets for an iPhone do not have either an emergency fund or a retirement savings account of any form. An iPhone is not much good when you can't afford car repairs if your car breaks down or rent if you lose your job unexpectedly. And that $800 purchase will be worth many times over if it were instead placed into a good long term investment account like a Roth IRA. Just for fun I typed $800 into a compound interest calculator, and I discovered that $800 when left to grow over 30 years will yield approximately $11,553.00 if properly invested. So how affordable does that iPhone seem now?
Wasting what seems like a tolerable amount of money, given the power of compounding investments, has serious consequences on how well off you potentially could be in the future. So don't give in to the techno-hype, folks. If you do, you are significantly short-changing yourself and your future. Instead skip the iPhone and other luxuries and place that money into a long-term retirement account. Trust me, you won't really miss the gadgets, and down the road you will be able to afford all the high-tech toys your little heart will desire; and those high-tech gadgets in thirty years when you do retire will make todays iPhone look like yesterday's slide rule.
Published by Zachary Fruhling
Zachary Fruhling is a Ph.D. Candidate in the philosophy department at the University of California, Santa Cruz. He is also an education digital content developer for logic, philosophy, and personal finance.... View profile
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59 Comments
Post a CommentIf you're going to argue investing is more prudent than immediate gratification then you should pick something less subjective than an iPhone. How about a Ph.D in Philosophy? Imagine all the money you could have earned working a minimum pay job during those years.
Your argument is only logical if one buys into the main premise of the iPhone being useless. Otherwise, your point is useless. Which is where I'd like to leave it because I actually get lots of "educational" benefits from mine.
My investors have lost enough of my money to buy a new Harley...and not a cheap one either...so much for investments!
And CD's don't pay squat for interest anymore.
Plus once OPEC takes the dollar off as the standard for buying oil, i the near future, our money's value will turn to toilet paper.
May as well spend it before that happens.
Do you ever have a point. B ut people just have to have what the media hypes as being the next in thing.
I would wait 30 years! :)
Interesting article but I agree with what other people say, 30 years is a long time to wait for $11K and after 3o years, what would the $11K buy me? A computer mouse? Also, I don't quite agree with you that people who can afford the iPhone don't have savings. I have an $800 phone (not an iPhone) but I also have a big chunk of savings ready in case of emergency.
The apple iPhone is not marketed to the average consumer. Its just got more hype then it deserves. Although a very nice piece of equipment, I also have no use for near all of its features. There are hidden costs besides the high price tag as well, namely the numerous monthly costs you will have to endure from your cell phone provider to enable features such as internet use and email.
However, that being said, to the people who can afford it it might just be worth it to them. I wouldn't go so far as to put my money on the iphone users not having an emergency fund of some kind, in fact I would do just the opposite. I would bet that the people who can afford it and purchase it have money safely invested in some CDs.
Also... why would you wait 30 years to make less than 12K? Just get a real education in 5 years and you'll make at least $20,000 in a year.
"down the road you will be able to afford all the high-tech toys your little heart will desire; and those high-tech gadgets in thirty years when you do retire will make todays iPhone look like yesterday's slide rule."
What about all those people who made prudent investments 30 years ago?
Also, keep in mind that new technology is expensive when first introduced to the public. Computer monitors a decade ago were $800. Technology enables you to live a comfortable life, unless you're an Amish and do not interact with modern technology at all. And while the iPhone isn't exactly necessary, it's an amazing piece of hardware and software that may pave the way for some future technology. You're talking about keeping things in perspective. Well think about how much tech you use in a day. Lighting, heating, hot water, traffic lights, cars, computers. Ehm, excuse me none of this is completely necessary. I guess the people who buy these things and keep them running should save their money for
Nice piece!
Perspective uber alles, n'est pas? Mixing and matching languages is free - doesn't tie up potential earnings in a singular - probably already planned-to-become obsolescent device. I love clear thinking and appreciate your!
David
Tell Zachary Fruhling to let other people get a life.