What That $10 Shirt Really Costs You!!

Do you ever just feel like you need to buy something to revamp your wardrobe a little bit?  That’s totally where I’m at right now. My summer wardrobe is so tiny and its been so incredibly hot out that I don’t have the option of wearing my warmer clothes, meaning I’m wearing the same few things over and over again. I’ve been a little bummed about not being able to find that linen skirt that I’ve been coveting. It would be really nice to have a summer skirt! I’m also quite intrigued by silk-linen blend tops. Anyone familiar with that fabric? J. Crew’s tee (now an extra 40% off) was first on my wishlist, and now this super adorable T by Alexander Wang one tops the list (that pink color is gorgeous!). But the problem is that I haven’t been paid yet after working for almost three weeks (soon…)!!  I know I could just grab some cheap summer tops for $10, but it seems like a waste to me if they wont get much love. But how much of a waste would it be?

spend or save

To spend or to save…

Ever since I got my final loan statement for medical school (>$200,000), I’ve been doing a lot of reading on personal finance. Every book obviously emphasizes saving and investing. But everybody has to find a balance between saving and spending that works for them. It doesn’t seem logical to save as much money as possible and sacrifice all of the little things that you could buy to make you a little happier in everyday life. But finding that balance can be difficult.

Here’s and example that might help:

Say you buy one $10 shirt per month that you’re not really in love with it, but it’s cute, it fits ok, you’re really in the mood to buy something. Hey, its only $10, right? Not a big deal if you wear it once (if ever!). Say you do this once per month for a year. Its only $120 that you actually spent…

We’ll use me for the next part of this example. I’m in my mid-twenties and plan on retiring at 65. So, I spent $120 on items that I never wore. If I would have chosen to invest that $120 in a mutual fund that makes 5% per year, after 40 years, that $120 would have increased to $845 (you can check that number with any compound interest calculator). Surprised? That’s no small number there.

What that means to me is, well, don’t buy it unless you love it. Think every purchase out, because every little thing really does matter!! I’m trying to put this into practice with my monthly purchase goals, but its been difficult. But I’m going to keep trying to get better with it and only buy practical pieces that I’ll wear over and over. I can’t tell you how many $10 purchases I’ve made over the years that I ended up never wearing. Thinking that those purchases could have given me back $70 each at retirement is quite the reality check! Hope you found this interesting 🙂