While watching Steve Jobs yesterday…

Ramit Sethi

…as I was watching the awesome new iPhone presentation…

…I posted this on my Twitter account yesterday:

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Every engineer who scoffs at ppl buying $250 jeans should closely examine how he feels about the new iPhone right now. It’s about emotionMon Jun 07 18:27:28 via web

See more about judging others’ spending and how much an iPhone will really cost you.

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  1. dense

    I’m an engineer, and I scoff at people buying iPhones too. I use a ten year-old phone and I’m happy with it, so everyone else should, too!

  2. Jules

    I don’t mind so much that other people get iPhones or cool cameras or what-not that I can’t afford. What drives *me* crazy is when they get iPhones and cool gizmos and what-not that I can’t afford–and then not have the savvy to use it, or learn to use it. Money wasted (however you want to define it) is one thing. But to waste it on something that you don’t even care that much about is just…well, wrong.

  3. bkd69

    My issue isn’t with people buying $250 jeans…my issue is with people buying $250 jeans OFF THE RACK.

  4. Walt

    It’s not the same at all. Spending $250 on a single pair of jeans is crazy. Spending it on a device you’ll use for multiple hours a day every single day for two years is a pretty good deal.

    • Julie

      Not everyone who has an iphone uses it for multiple hours a day. Some people just got it because it was “the thing to get”, and actually use it only for phone calls and texting, and don’t touch their phones for most of the day. I’m thinking of the over 40 crowd who isn’t in IT.

      On the same level, I know women who spend $400+ on shoes, and they love these shoes more than I have ever loved my phone. I’ve even heard them refereed to as “baby”.

      Also, for the iphone, you spend a lot more than $199 for two years. Don’t forget that you also pay for the phone contract, so it really is a lot more than $199.

    • cc

      what if you wore those jeans every day for two years (less laundry days)? then it’d be a pretty good deal- 3 cents a day!

    • HollyS

      What, you just wear your jeans once and throw them away?

    • Erica Douglass

      My favorite shoes are a pair of Mephisto sandals. They ran $200 when I bought them about 6 years ago. At the time, it was an outrageous sum of money for me.

      I still wear them at least 50 days out of the year. They’re a bit worse for wear, but they’ve held up remarkably well. They are comfortable enough that I can walk miles in them.

      I’ve since bought two other pairs of Mephisto shoes, also in the $200 range, and I’ve been extremely happy with both of them, as well.

      This is more than I can say for any cell phone I’ve ever owned.


  5. Wes Y

    While neither the iPhone nor expensive jeans holds a special place in my heart, you make a good point about how, for all but the most stoic and spartan individuals, there is SOMETHING that they desire (and likely purchase) that has minimal “practical” value. Yes, it’s possible to justify the iPhone (increased productivity while away from my desk!) or expensive jeans (making a good impression on customers leaves them feeling positive about me and may get a sale later), but why not my fancy car stereo too? If I’m more content while driving around because my music sounds better, I’m less apt to road rage – it’s a safety improvement!

  6. Someone

    With savvy shopping, I got my Blackberry for free last fall. Anyone who feels they HAVE to spend over $200 to get a good, current smartphone is…a perfect marketing victim. Not being of the fashion-followy type, I just chuckle and pocket my over-$200.

  7. Tyler WebCPA

    Who needs to justify the stuff they buy? If you start trying to justify then that usually means you can’t afford it. If you know how much you have to spend and have a budget then justification isn’t necessary; either you can afford it or you can’t.

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  9. Peter Nguyen

    “walt: It’s not the same at all. Spending $250 on a single pair of jeans is crazy. Spending it on a device you’ll use for multiple hours a day every single day for two years is a pretty good deal.”

    @walt: If you have any interest of the time, I suggest you google “heritage denim” or take a look around a website called superfuture sometime. There are companies that are reproducing vintage americana style denim from companies like Levis. (think of it like a company reproducing an exact replica of a 1965 mustang fastback)

    The appeal of these jeans is the fact that most of them are raw, unwashed denim, and are ‘broken in’ by the consumer. To do this, you go as long as you can without washing them and wear them as much as you can, some people even wear them everyday and to bed. If you want an idea of what this looks like check out this video:

    As ramit is saying, value is personal.

  10. Edward

    $199 for a new smartphone is pretty normal as far as new smartphone goes. Cell/Data plans are similar across all the providers. It would have been a good comparison if the iPhone was say $599 with contract back when it first came out.

    But I see the point.

  11. Rose M

    I agree, value is very personal. You decide what’s most important to you and you spend your on those things. For some it’s the latest high-tech toy, for others it’s clothes, cars, video game systems, etc. From my perspective if you’re funding your retirement, have money saved and have taken care of your debts, what’s the harm in buying something “just because you want to” or because “it’s new, cool and fun”? For me, smart phones aren’t that important – my phone is probably 3 or more years old. It makes and receives calls, that’s all I need right now. It can text too, but I’ve yet to use it for that. I spend my money on other things I enjoy like jewelry, collectables, travel – with cash of course.

  12. Patrick

    As a man, it’s a question of marginal utility:

    Which is most likely to help me get laid? A new $250 pair of jeans, a new $250 iPhone, or $250 spent elsewhere? All the other considerations people have brought up seem kind of silly.

    Depending on the situation, I can see arguments for all three.

  13. Jake

    @Julie: Remember, though: its an incremental cost. That is, if you have to have phone service (land or cell), how much *more* are you paying for the iPhone plan. As I have to have cell phone & e-mail an iPhone will actually not cost anymore and might cost *less* than what other people at my company use.

  14. Mary

    As long as you pay your fixed expenses (rent/mortgage, savings, investments [401K, Roth IRA, etc.], insurance, etc.), then variable (utilities, grocery, phone bill, etc.), then the money you have left over is yours to spend however you would like.

    It doesn’t matter what you spend it on because you’ve paid your expenses (bills, etc.) and yourself (savings, investments) first. So quit judging others’ spending and start getting things set up so that you don’t have to think twice about the money you’re spending.

    Of course if you have debt, theoretically, you could always be putting extra money toward that, or could save/invest more, but once you determine how much to allocate toward these critical items, the leftover dough is yours to spend as you would like.

  15. HollyS

    I feel like defending my jeans. I have an almost $250 pair of jeans that I wore every other day during the winter and at least once a week during the summer. They are the best looking jeans I have ever worn (which increases my self-esteem), they fit like a dream (which increases my comfort), they are just perfect and hold up really well (decreases cost per wear). And I’ve worn all sorts jeans of different prices from different brands (even ~designer~) so it’s not like I went from Wal-Mart to Nordstrom and was shocked when they were predictably better quality. OTOH, my phone is 3 years old. Clothes make me happy. I think a lot of the expensive shoes/purses/dresses (maybe not jeans, though) people think are frivolous are beautiful, and having beautiful things in my life is worth a premium price.

  16. DanP

    I think the point of this post is being lost. The point is that ppl “scott” aka judge other people’s purchases without looking at their own purchases. For the engineers in this situation, they make fun of ppl who buy 250 dollar jeans but think the ipod is a great way to spend money. While the person who buys the 250 jeans thinks the ipod is a waste of money.

    We’re not suppsoed to argue what’s a better purchase, you’re supposed to realize that both are great purchases……as long as u’ve saved what you’re supposed to save first.

    • Ramit Sethi

      God thank you for leaving this comment, DanP.

  17. Jason

    I am an engineer and I do scoff at people who do pay for iPhones as well as buy designer clothes. Recently there has been a great deal of discussion in my department regarding the iPad, cameras, Android phones and, of course, everyone was watching Engadget yesterday, drooling over every last page refresh to see what new shiny gadget was coming from Apple.

    I know I do work with a lot of people who make good money. I also know that I work with a lot of people who are hourly employees, making a decent hourly rate, but certainly a lot of that money is going to pay for housing and food, since I live in a pretty expensive metro area. Adding in the cost of the smartphone, be it Android, iPhone or Blackberry, plus the monthly fees can come to a pretty hefty portion of some of the incomes. We’ve also not had significant raises over the last couple of years, either, so I know the money pool hasn’t gotten bigger, either.

    It’s not only the hourly people, either — a relatively high level manager recently had to refi his house to pay to replace his dead minivan that he couldn’t repair because all his credit cards were maxed. Yet the family purchased four iPhones, plus the attendant calling plans, and they did indeed take their yearly trip to Disney.

    So I don’t have a problem at all with technology or clothes, and frugalistas drive me batty, but people need to get their financial house in order and take a break from the toys. There will always be a new shiny thing coming out for you to get and have people go “ooooooh” over. Nobody’s going to get all excited over the collection agencies calling you.

    FWIW I have the iPod Touch, which is probably the best “value” gadget that Apple makes. You can get all the fun stuff that is available for the iPhone, but there’s no monthly service fee and it’s getting updated just like the iPhone, too. I carry a prepaid phone that sets me back a whopping $7 a month, and most places have wifi anyway, so I get a “data plan” of sorts through the iPod. Oh no, I have to carry two gadgets, but really, being always reachable is WAY overrated, anyway — try it out, twentysomethings. It’s a very liberating experience to have no IM’s, texts, emails, facebook or twitter to keep up with for a day. And the world will, in fact, go on.

    As for “safety” as an argument for having a smartphone, that’s really a silly justification. My $7/month prepaid phone does the same exact thing — makes phone calls and sends texts. It’s always highly likely that you are also around other people who have phones, too — so if it’s really an emergency you can just borrow someone else’s. And data plans aren’t really part of an “emergency” thing, either — does anyone need to send an “emergency” email or browse an “emergency” web page, or send an “emergency” tweet?

  18. Creative Image

    You can’t compare $250 jeans with an iPhone. They are not the same thing. First of all people spending $$$$ on jeans is not using their money. It’s either a trust fund $, daddy’s, or borrowed on plastic. iPhones takes a corporation to make with different industires working together to build an awesome product that is part of a life stye. That is justifiable to pay the money for. Jeans just get dirty and gets washed, but it sure damn looks good on a right person.

    • Ramit Sethi

      That is completely absurd. I know plenty of people, including me, who’ve spent over $100 on jeans using their own money, and it’s “part of a lifestyle.” What is justifiable to you is nuts to someone else — and vice versa.

  19. TomH

    I couldn’t disagree more with Creative Image. The point is not to compare jeans to phones. In fact, the jeans in the situation are just as arbitrary as the phone. Who are you to tell me to spend my money on a phone rather than jeans? I think the point is really if you’ve diligently put an automated finance system in place and saved money for a purchase that has value to YOU, you should go ahead and buy whatever it is that you enjoy. I don’t value a smartphone enough to spend $250 on it, but I understand that there are people who get a great deal of pleasure out of owning one. Whether you spend your money on clothes, technology, art, or entertainment, the idea is to have your finances in order first, then spend on whatever is valuable to you.

  20. DanP

    Ramit, i’ve been reading you’re site for a little while now, and I’ve definitely noticed the quality of the comments going in the wrong directions…..what’s happened?

    • Ramit Sethi

      They’re not anything unusual, it’s just the recent topics.

  21. Bash

    You are confusing people who buy devices to use them with those who buy them to show off.

    Similarly, there are people who buy clothes to use them and those who buy them to show off or “make a statement”.

    There can be any combinations of the above categories.

  22. Doug Warshauer

    The essence of Ramit’s post: “it’s about emotion” has been lost in this discussion, which has been primarily focused on trying to rationalize the value, or lack thereof, in $250 jeans and iphones. The point is that both are purchases NOT driven by a rational spending decision. They are driven by desire. That doesn’t mean that they are irrational purchases, it simply means that people aren’t doing a detailed cost/benefit analysis before deciding to make the purchase. They are buying them because they want them. That’s what good marketing – and both Apple and the jean manufacturers are among the best – does.

    • Ramit Sethi


  23. Jeffrey

    Some people are seriously crazy about their denim. Example – check out

    It’s basically a bunch of people taking pictures of their jeans going, “This is what my jeans look after 3 months… 4 months…” Interesting stuff.

  24. Mike

    It’s all about what you value. It’s easy to judge other people on what they buy because they value different things. If you like having the latest technology, then the iPhone is for your; if your into fashion and don’t care about tech stuff then the iphone is not for you.

    Take another example, I use my vacation time to travel because I like to travel where as somebody that doesn’t like to travel would use their vacation time and sit at home. I can easily say that’s a waste of vacation time, where as they could easily say that traveling is a waste of money. It all goes back to what you value.

  25. Jeremy

    Value is inherently personally subjective. If value was objective, and everyone valued things equally, trade would be impossible. Trade is possible because the buyer values the item more than the money, and the seller values the money more than the item. Who is “wrong” in this transaction? If they are both wrong, because value is objective, then we ought to stop trading and everyone become completely self-sufficient and dirt poor.

  26. Josh Moore


    In regards to DanP’s comments, I’m guessing the site redesign and the change in topics is all a part of your experimenting. It’s funny how people get overly excited about the idea of earning $1k extra but don’t like the idea of reviewing their spending. In reality, the latter is the equivalent of earning $2k+ for every thousand dollars you save (that’s assuming taxes are paid and the money saved is used to repay debt).

    I like the way you point out the irony in some peoples lives (and definitely my own at times). However, rather than criticizing others or getting defensive, I reflect on what you say and my personal situation, then commit to taking action.

    Keep up the good work 🙂

  27. Tim Rosanelli

    Yes, I agree. Alot of purchases are a matter of perspective. Before I owned a business and I worked in the corporation world, I would pay the $250 for jeans or pants in a heartbeat. I would show up to work dress professional everyday to enhance my image to help get better raises. It worked and I went from a customer service rep to upper middle management in 3 years, over doubling my salary. Paying $250 for jeans made sense.

    Now, I am a business owner and don’t need to worry about my dress so $250 would seem ridiculous now.

    It’s all a matter of perspective.


    An iPhone may or may not be a good decision right now. It all depends on your financial situation. If you can’t afford it, don’t live beyond your means, wait a little while, the price will go down. And if you can afford it and want it, then go for it!
    *Just remember there is always debt help if you need it!*

  29. baron

    is it just me, or are a lot of recent commenters missing the point of the posts?

    it seems people are arguing over ramit’s examples instead of the points he’s trying to make.

  30. Treacle

    I’ve spent a couple hundred dollars on jeans before. I wore them until they were literally threadbare (and then some), and I felt they were worth the money. What can I say? They made my butt look good.

    Nowadays I don’t spend so much money on jeans, but I am looking at purchasing an iPhone (especially since they’re only $97 at Wal-mart now). I want the apps. I want the features. I want to be able to blog and tweet and Facebook on the go.

    Neither one is or was a waste of money. They just reflect what people find important. For some folks, that’s fashion. For some folks, that’s technology. And for some folks (like my friend who wears secondhand clothes, but’ll drop a few hundred on a good meal), it’s neither.

    So long as you can afford it, what’s the big deal?

  31. Bob

    I like what the comedian Stephen Wright said: “I bought a new camera. It’s very advanced. You don’t even need it.”

  32. Rance Rob

    It’s funny… this post shows that what is valuable to some isn’t very valuable to others. I like fashion & tech. I’m more apt to get an iPhone because I’m stylish enough to hit the sales racks and look wayyyy better than someone who went to Nordstrom’s to get an outfit.

    My feeling is that as long as someone is not buying an iPhone/Expensive whatever and skipping paying their bills and are stashing some money away then go for it.

  33. joe

    The folks in the photo are the worst, they are calling each other when they are sitting in the same room.

  34. Pramod

    Let me put it this way. iPhone lets you discover a lot more which otherwise you wouldn’t have dreamed in first place. Don’t just look iPhone as just a phone, rather your guiding friend.

    Yes, i agree that if you spend $299, make right use of it like for ex, taking pics, shooting cool vids etc. I dont have an iPhone yet, but some of my friends you have 3GS are crazy abt their phones — making me buy one.