4 things you can gain by not buying that Chanel handbag
PUBLISHED ONJune 12, 2015 9:01 AMByJoanne Poh
A friend hailing from overseas once commented that she was amazed to see so many genuine Chanel handbags being toted around on the MRT in Singapore. In fact, most of my female friends have at least one bag from Chanel, costing about $5,000 to $7,000 a pop.
And no, most of them aren't the daughters of tycoons but middle income salarywomen. Now, nobody's judging, but am I the only one who thinks it's weird that to so many Singaporeans, $5,000 represents a chance to buy another Chanel bag… and not the chance to go on sabbatical for a month or two?
Here are 4 things you gain by not buying that Chanel handbag:
1. Less stress
One of my friends, whose modest handbag collection is worth at least $20,000, tries to save money by having having only two vegetable dishes with her economy rice at lunch.
While her salary is above the national median, she is constantly stressed out by the rising cost of living. Because seriously, who isn't?
But that's the whole point why you might want to not go out and spend all your money on a Chanel handbag. If my friend could trade her Chanel 2.55 for cash right this minute and put it towards her emergency fund or invest it for retirement, she might just find herself feeling a little less pessimistic about the future.
2. Early retirement
Despite the general consensus that the average Singaporean citizen is pretty much doomed to put his nose to the grindstone well beyond retirement age, it seems that many do little besides complain.
Just imagine you hadn't spent that $5,000 on a Chanel handbag. Instead, you invested the money at a rate of 5 per cent per annum. In 30 years' time, thanks to the power of compounding interest, that $5,000 would have become… $21,609.71.
If your handbag cost $7,000, your investments would have ballooned to $30,253.60.
Now, if you spend $2,000 a month, that means that one Chanel bag could be making you retire around 1 year later. Is a Chanel bag really worth an extra year of toil? You be the judge.
3. More free time
While Singapore has its fair share of billionaires (and children of billionaires), many average income earners have Chanel bags, too.
Assuming you earn an above average salary of $4,500, it means that $5,000 to $7,000 Chanel handbag is worth more than one whole month's worth of salary.
Instead of spending 1-2 months' worth of salary, you could have taken an entire month of unpaid leave to go see the world or just rest your tired body, no doubt overworked from having to toil to fund all those Chanel bags.
People often look enviously at young people who take time off in between jobs to go travel the world or pursue their hobbies.
Well, if you held off on buying that high end designer bag, you would technically have saved enough money to survive for at least a month or two without being paid.
4. Spending money for experiences
As much as it lets you channel your inner Audrey Tautou (or so you wish), that Chanel handbag isn't going to make your life more interesting.
So the next time you complain that there's nothing to do in Singapore, think about what you could have done with the money instead of buying another bag.
Here's what $5,000 can get you:
- 3 years of unlimited classes at Pure Yoga, probably the poshest yoga studio in Singapore
- A high end DSLR camera + lenses and accessories + a full suite of photography classes
- 1 year unlimited membership at Evolve MMA gym + full set of equipment and accessories
- Flight to Australia + hotel stay of 3 nights + 10 skydives (if you're really that into it)
- A years' rent in a luxurious Bangkok apartment 10 weekend trips to Bali including flights and stays at luxurious resorts
This article first appeared in MoneySmart.
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