ONCE I GRADUATED college and started working fulltime, I knew what my first major purchase would be: a sporty new car. I was jealous of the cars my friends drove in high school. I had just spent four years grinding through an undergraduate engineering program. I was ready to reward myself.
To prepare for the purchase, I minimized my expenses. I shared an apartment with two friends who had also just graduated from college. I ate peanut butter and jelly sandwiches every day for lunch. I routinely kept my grocery bill under $20 per week, while eating out only on rare occasions.
One year after I started working fulltime, I got a call from the dealer saying that my car had just arrived and was ready for pickup. I still remember exactly where I was when I received that call, and I immediately started the hour-long drive to the dealership, giddy with excitement.
Once I arrived, I spent another hour signing paperwork. Finally, I was handed the keys and walked over to the service bay where the car was parked. I remember sliding into the front seat. My hard work and patience had finally paid off. As I gripped the steering wheel for the first time, I prepared for a wave of satisfaction to wash over me.
But nothing happened.
Instead, it quickly dawned on me that this was just another car. Sure, it was newer, faster and had more features than my current car. But it was still just a car. I was confused. This purchase was supposed to bring me so much joy. Instead, all I could think was, “Is this really the best way to spend $40,000?”
As I drove home, I had a lot of time to think. I definitely didn’t feel any more satisfied than when I was driving my old car, though I also didn’t feel any less satisfied. That was an epiphany for me, one I’ll never forget: At that moment, I realized that if I’m not satisfied with what I currently have, I won’t be satisfied with what I have later.
Through that experience, I learned that satisfaction comes more from my mindset than it does from a single possession or a new purchase. Over the prior five years, I had unknowingly grown satisfied with working hard at school, starting a new career and learning to be frugal with my finances. The financial habits I had to develop to afford the new car had, ironically, also forced me to find satisfaction outside of material possessions.
Realizing that my car wouldn’t satisfy me has actually freed me up to enjoy it more. After six years and nearly 100,000 miles, I still enjoy driving the car. But that satisfaction now comes from seeing how long I can keep the car, rather than from pondering how soon I’ll be able to buy a new one.
There’s one story that’ll always stick with me from my first year of owning the car. I was at a gas station filling up when a man came up to me, excited to see the car I was driving. He gushed over how cool he thought the car was and asked how I could afford it.
Embarrassed by the attention and eager to shift the focus to something else, I truthfully explained that I had eaten peanut butter and jelly sandwiches every day for an entire year to pay for the car. Upon hearing that, his smile waned and I could tell that he doubted the sacrifice was worth it. I love telling others that story—because it captures a timeless truth: The disciplined savings needed to afford a major purchase is often more satisfying than the item we think we want.
Austin Dorenkamp wears many hats including software engineer, program manager, landlord, husband and therapy dog handler. He’s even been called an ice cream sommelier. If he’s not giving those around him unsolicited financial advice, Austin’s likely cracking a joke or driving in a time-efficient manner.
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To add a counter-argument, at 29 I bought a (1yr old) Porsche 911sc (money from the sale of a software program). The sensible course would have been to invest the money, and I would likely be richer now if I had, but I don’t regret those years in my 30s of being single in LA with a Porsche. 12 years later I sold it for $12K less than I paid, so a pretty good investment from my perspective. My take-away is if you’re going to recklessly splurge, buy quality and spend enough to make a difference.
That’s a great point! At the end of the day, we shouldn’t be saving money just to save. Rather, we should be saving to enable experiences and opportunities that truly bring us joy. It sure sounds like that Porsche brought you joy for 12 years, which seems like a reasonable ROI to me!
Out of college I bought a Mazda and drove it for more than a decade. I was going to replace it with a Toyota and ended up at one of those old-fashioned high-pressure dealers which really turned me off (they did stuff like taking your drivers license because they “needed a copy” and then holding it hostage so I could not leave).
My brother said why not buy a luxury car, a BMW. The staff there were the opposite of Toyota. Essentially “here’s our cars, let us know if you’d like one, give us a call”. So I bought one.
It was the most expensive car I’ve purchased, probably 2x the price of my previous car. After paying so much I expected everything to work perfectly but was wrong about that, it had a few relatively minor things that the dealer couldn’t fix. But you know, I felt better about myself when I drove that car.
Great article especially the part about the satisfaction that you get from seeing how long the car can run. A car, in my opinion, only needs to be reliable, safe and comfortable. There are many that fit that description that won’t cost a small fortune.
Austin, thanks for an interesting article. It’s fun, even for us cheapskates, to sometimes indulge in a luxury or two. I’m lucky in that I don’t feel the need to live in a grand house, drive an expensive car, or go on extravagant vacations. On the other hand, I think nothing of laying out $100+ on a pocketknife, as my hobby is collecting them. I rationalize that it’s a relatively “cheap luxury”.
One thing I’ve learned from highly successful people, and success can be measured in a multitude of ways, not just material possessions. You want to “buy” assets and “rent” liabilities. That’s why any car I buy in the future will be a lease. I’ve never done that before, but cars are just that, liabilities. Some may or may not feel the same way. I currently own a 2007 car I bought while in the MLB. I just don’t have a passion to purchase things I know will depreciate in value over a longer period of time.
That’s just my two cents, which if you add in inflation, isn’t really worth a whole lot.
To add, I grow excited with growing my bank account. The satisfaction I receive in saving and seeing the numbers move higher never wanes.
Thanks for the additional perspective, Kevin! I agree that learning to find joy in a growing bank account can be a great habit (as long as you keep things in a healthy balance). I’ve actually got an article coming out next week related to tracking net worth that touches on this very point.
Regarding trying to buy assets and rent liabilities, have you considered that it may be cheaper to buy an older car rather than lease a newer one? As I understand it, leases are only offered on relatively new cars. So, if you were trying to minimize the amount of money that depreciates, buying an older car that’s already depreciated significantly may help with that. After all, the monthly cost you pay to lease a car already factors in the cost of deprecation (so you’re not really avoiding the depreciation any more than if you bought it outright).
I have to agree with Austin on this one. We always buy cars that are a few years old with fairly high mileage. We let others take the initial (big) depreciation hit.
Fresh out of law school and laden with student loan debt I decided that I deserved a brand-new Mustang. Having no money I 100% financed it. When the first payment came due I discovered how much I hated making that car loan payment. I kept the car and paid it off fast, but I learned a similar lesson. All that glitters ain’t gold.
That’s one rocket of a car! It is so true that things don’t bring happiness. But if you keep your perspective they can make life incrementally better. I drive a similar vehicle, my third one of the same model. But I buy them used and keep them to at least 200k miles. It’s just nice to be able to pass someone when you need to pass! Great post.
I completely agree about the ability to pass people. My wife and I often travel on two-lane roads when traveling around the midwest to visit extended family, and being able to minimize the time you spend in the opposing lane when passing is actually a really important “safety” feature… at least for those of us who like to pass!
So, as a car guy, I’ve got to know what the car was.
It’s a ’16 Ford Focus RS. I debated mentioning it in the article but didn’t want to distract from the main focus of it, especially for people who don’t care about cars! It was the first grey RS in MN when I got it, which led to many fun conversations with fellow car enthusiasts. But after a few months peoples’ attention always shifts to the next new thing. It’d be an expensive hobby to try and always have the latest and greatest!
So let me get this straight . . . you ate a peanut butter and jelly sandwich for every day for a year to buy a Ford Focus?!
I do have to comment on the RS. I was at an event at the Ford test facility in Dearborn, MI where we got to ride hot laps with professional drivers. The driver and car I rode in was a RS. I remarked that my wife owned a Focus, and the driver remarked, “Not like this one!” And he demonstrated what he meant! Quite an impressive vehicle!
Thanks for sharing your story Austin. Happiness can be an elusive prey. I’m still learning that I can sometimes find myself on the wrong track.
As Peggy Lee sang to us:
“Is that all there is, is that all there is?
If that’s all there is my friends, then let’s keep dancing
Let’s break out the booze and have a ball
If that’s all there is.”
There will many more “is that all there is experiences” in your life. Enjoy the moments pleasure.
Peggy Lee was a bit before my time, so I appreciate you bringing up this reference. Truly a fitting chorus and a great reminder!