I posted this article 8 months back. When I posted it I was hesitating whether my readers would be ready to take such advice. My hand was trembling when I clicked the publish button. Fortunately it has reached well and to my amazement it has more than 200 comments already and the advice is still valid after all these months… and will hold true even after a few years. Since we have gained a ton of new readers in the past eight months, and I am bringing this article back to the top. Do leave your comments. – Deepak
March 22 2011 Before you start reading this article, please note that the ideas here are just my opinion and not advice. Feel free to contradict on my views. This article applies to students who are going to buy their first bike with the financial help of their parents and also those who receive partial financial assistance from their parents to buy their first bike.
Let us now consider that you are a student who has completed his 12th std. Even if you aren’t, just put yourself in those shoes so that you can get my point. You have completed 18 years of age and now you have your 2-wheeler driving license. You need a bike to commute daily to college. Even if you are going to stay in a hostel you need a bike to go along with your friends. At this stage you aren’t making money yourself. But a bike is a basic need. So your parents decide to buy you one.
If your parents are affluent, they may decide to buy you any bike you want. If your parents are not so affluent, and if they love you so much, they will extend their finances to buy you the dream bike you want. If they are not affluent, they will buy you a commuter bike which costs in the medium bracket.
In the above three cases, the last case does not seem to pose any problems. But the first two cases causes some problems which are not so obvious [in my opinion]. Here are the reasons why…
1. When you buy your dream bike with your own hard earned money, you can appreciate it a lot better. In fact, most of the pleasure lies in saving money for it and contemplating for it. And when you buy it with your own money, you will do a lot more research for it and choose the right bike for you. You will never get the same pleasure when you buy it with OPM (other people’s money). Though you cannot consider your parents as others, it is still not your money. Your money by definition is the money earned by you.
If you receive partial financial assistance from your parents, there is nothing wrong in it – or so it seems. But the problem that I see in it is that it dilutes your hard earned money along with it. It is always easier to spend other’s money than your own money and hence you may end up buying a bike which is above your means and get into the treadmill of a high consumption lifestyle.
2. Cars and bikes are more of a status artifact than a tool in today’s world. That’s how marketers have marketed it. I personally think that is unhealthy for several reasons.
When you buy a bike, buy it for utility and not for show off. Buy it for how it rides and not because it turns heads. Respect comes from what you do and not what you have. You express yourself through creation and not through possession. Marketers give you a perception of creation by introducing so many motorcycles, with so many colors with so many options (like disc brake, self start etc.) and this is even more common in cars.
You get a sense of uniqueness by choosing the one suited to your tastes, but do not fool yourself. That is absolutely not self expression even by a long shot. Self expression includes creation such as music, art, engineering (inventions), creating business systems, making transformations and so on. If you perceive your bike as a status artifact, as a tool to display your presence, read this point once more, else move on…
3. Having a high priced item (say a high end bike) comes with its own costs. It is a piece of a social status puzzle and it has to fit with the other pieces. And your cost of living goes up even before you know it. Say for example you have a Ninja 250R… then you have to match your clothing, watch, eating habits, mobile phone and laptop to fit with the Ninja. You cannot stick to minimalist utility products while one of your possessions is out of the line. People will look strangely at you.
When you buy a high end bike with OPM, you get pulled into a high consumption lifestyle slowly without your knowledge. I believe in being frugal and investing money. Earning money just for spending money is not my idea of a good lifestyle. Again, remember that I am not asking you to never buy high end bikes. Just saying that it shouldn’t be bought with OPM.
When you buy a high performance bike with your own money… there is a lot of benefits to it. First, you will introspect whether you really really need it – you will have maturity in deciding. Maturity automatically comes with age and it definitely takes a few years into your profession to accumulate enough savings to buy a high end bike. At this stage of maturity you will not buy it as a status artifact. And if you are buying it for performance then you will have the maturity not to match it with your other possessions.
Have you observed that some people are very rich but are so frugal? You may (even I have) thought that such people do not know how to enjoy life. But the reality is that they became rich by being frugal. People who look rich aren’t so and really wealthy people don’t look like it. The media has proposed a very false image of “millionaires”.
And here’s an excellent analogy to understand the above few sentences: If you see people in your locality jogging regularly every morning, those are the people who look like they don’t need any exercise. They look absolutely fit… but they stay fit because they jog regularly. Wealthy people remain wealthy because they do not get drawn into a high consumption lifestyle. Being frugal is like eating healthy foods everyday and exercising. It is difficult but worth it. I would like to quote my all time favorite words here…
Life is easy if you live it the hard way,
Life is hard if you live it the easy way.
What do you think?
P.S. This post has been inspired by The Millionaire Next Door
Disclaimer: I am aware that I am contradicting with my own behavior. I bought Karizma with my Dad’s money. But it was 6 years back. I have evolved to a new stage of thinking and perceptions. And will continue to do so and share my thoughts with you. FYI, I bought my second bike – R15 without any financial assistance.