Why Bigger Isn’t Always Better

As the years go by, it seems we have all been buying more and more into the cliché “bigger is better”. I have to admit, I wouldn’t refuse a bigger paycheck each week, or a bigger piece of mom’s apple pie after dinner, but there are lots of other instances where bigger can create other issues that may lead you to real trouble.

Why Bigger Isn't Always Better

Being just a little practical and more conservative financially can give you mounds of money that can be used for real life priorities, like retirement, long-term healthcare, and life insurance as well as investing in your future. I’m not a scientist, but I’ve come up with a scientific formula that I wish I had developed years ago:

WS + E = R / HD
Wasteful Spending + Ego = Regret over Huge Debt

It probably could have saved me hundreds of thousands of dollars over my lifetime if I had used better judgment and considered my true priorities. Instead, I usually looked at life (as the majority of us do) admiring the glitzy shine and glamor of the “big” picture and missing the small details of fiscal responsibility. Being more thoughtful and conservative will increase your net worth just as being impractical and impulsive will reduce it.

Here are some things you should really consider before you get swept away to the “bigger is better” club as a lifetime member.

Bigger Cars

As I drive around and I see so many larger vehicles, I wonder if I missed something in the headlines. It seems to me that everyone is thinking they must drive some kind of SUV, van, pick-up truck, off-road vehicle, or military-style transport (can you say Hummer?). Don’t be fooled by the recent drop in the cost of gasoline. Long term, it’s like everything else we use, the costs will go up and make some of these vehicles really expensive to drive at something akin to 10 miles per gallon. In addition to gasoline, auto insurance costs more, and often maintenance and repairs.

There’s the obvious initial cost of the purchase (or lease) which may scream out “look at what I can afford to drive”. But really, can you think of anything else you buy that will be worth thousands less the minute you take possession of it?

Now, I realize that for some people, they have larger families that require a large vehicle, or they go off-road for real, or they use their pick-up truck for work. And of course, a few people have a lot of money and are able to responsibly buy such a vehicle because that’s a priority for them. But the vast majority neither need, nor can truly afford, these bigger vehicles and are buying/leasing them at the price of a sound financial future.

I think of an auto as transportation. I look for efficiency, safety, and reliability. Sure I’d like it to be stylish but I also know by being practical, it will save me the R/HD factor. Multiplied by a lifetime of car purchases, you can easily see savings of many thousands of dollars.

Bigger Televisions

We now live in a world where owning a 19-inch color television just doesn’t cut it anymore (bonus points if you can remember black-and-white TVs without a remote, and double bonus points if you remember when TV network service itself stopped at a certain hour each night). Having an ultra high definition, flat screen, giant television has become a requirement for all. And when I say giant, I’m talking about 40, 50, 60, 70 inch and even larger home entertainment systems that can cost you several thousands of dollars to purchase. Really?

I know I get better picture quality (thank you, HD) and that the TV is more than ever a part of your home décor, but spending $1,000-$5,000 on a TV set? With the constantly changing technology, this year’s set will be obsolete soon enough. Do I really need to see why HD isn’t kind to an aging star and see it in detail a foot high on their faces? If I needed to see the game like I’m right there, I’d go to the game and save some money in the process.

I haven’t even mentioned so far the additional cost of cable options like the movie packages, DVR leasing, and all the pay-per-view stuff that gets added in the bragging rights. Think about what all of that means to your budget priorities.

Bigger Homes

This subject really baffles me. I have owned 2 houses in my life as well as 2 condominiums (when I retired and downsized after my family was grown and gone). Today, I see young people, even without kids, buying 4,000-5,000 square foot homes and mortgaging themselves up the you-know-what. When I was a financial advisor (about a decade ago, but it is more true now than ever), I once delivered home equity loan documents to a young couple with no kids. They had a huge home, but many of the rooms were empty, so I asked when they moved in. I was embarrassed to find out they had lived there for 7 years, and the loan wasn’t for furniture but to pay off their credit card debt! I saw so many young high-earners living in what I like to call the Ponderosa (forgive my reference to 60’s TV legends the Cartwrights) and not being able to afford a stick of furniture around the house. The rationale that it was a “good investment” to own a bigger home fell through the floor after the housing bubble burst and many of those who bought in hit bottom with the big “R” of regret. Essentially, they bought something they liked, wanted, didn’t need, and couldn’t afford. They thought that would be their ticket as an investment. They never considered that owning a huge home would lead to higher utility costs, landscaping, real estate taxes, and other costs.

Even more amazing to me are the Baby Boomers (my age) who are now retiring, selling their homes of 20-30 years, and buying “senior living” properties that cost more than the homes they just sold! Why? Well, it has lots of glitz, glamour, and stuff they think they need like extra bedrooms, a complex with full gyms, basketball courts, indoor and outdoor pools, a clubhouse, and other tempting delights. While some may benefit from these amenities, the majority won’t use many of these extras and it just doesn’t make any sense to spend more when reitiring for your dwelling than when you had an active family and continued earned income. Downsizing is just that. Cutting costs and managing your expenses after retiring.


There’s more. I think about how much is spent on parties like weddings and bar mitzvahs these days, proms and prom proposals, even kid’s birthday parties. The celebrations seem to be competitive and not so much focused on ceremony and traditions but on lavishness and glitz. Or is it just me?

When you’re young and starting out in life, do you need a huge expensive wedding (especially if the couple is paying for it themselves), large diamond rings and extravagant honeymoons? Can’t all those things be just as meaningful, beautiful, and memorable without spending a small fortune?

I was taught some years back that sometimes “less is more”. It is a wise lesson to learn. Getting personal satisfaction from your life, for you and your family and friends isn’t for a specific time period of your life, it’s life-long. Using up your enthusiasm, energy, and resources to get ahead of everyone else and show off can come back big time to hurt you. Having a real plan includes today, tomorrow, and even the day after tomorrow.

Do you have any good reason to think that “bigger is always better”? What purchases have lead you to R/HD (regret over huge debt)?

One comment

  1. Jayson @ Monster Piggy Bank

    I do agree with you that good is not always in those big packages. It really depends on our needs and most of the time on our judgment, Gary. I think people just have to accept “smaller is not poorer”.

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