Most people are not rich, yet most of us still want a home and cars. The question is what motivates people to acquire items, usually beyond their means? Expensive doesn’t necessarily mean luxurious: After all, cars are necessary for travel and homes are needed if we want somewhere to live. Indeed, for most of us, we’re not talking about Ferraris or big mansions. Yet, even the least expensive will set us back somewhat.
What then drives us to get them?
Necessity and indulgence
Too often when discussing issues of why people buy expensive items, we assume that the items are not important. But as we noted, homes and cars are often necessities. This doesn’t negate that cars and homes can be luxuries, as any unbelievably large mansion or someone’s third or fourth car demonstrates. No one needs houses so large they take up nearly a whole field. And we can’t drive more than one car at a time.
Yet, rich people will and do indulge in such excess because they can. And, unfortunately, wealth is often tied to a sense of fulfillment according to researchers. This is so potent it leads even those who can’t afford luxury items to acquire them through credit. Writing in the Journal of Consumer Research, Marsha L. Richins concluded:
“Materialists are more likely to overspend and have credit problems, possibly because they believe that acquisitions will increase their happiness and change their lives in meaningful ways.”
This mindset doesn’t come from nowhere. Other researchers have shown the mere desire for items can be sufficient fulfilment. But again, this only shows us luxury goods not necessary ones.
What is necessary?
How then do we judge necessity when there is a heavy price tag? A good way is to consider a common, but fairly expensive item: cars. According to recent data, used BMW 1 Series from 2012 was the fastest selling car in the UK, in August. The car has proved reliable, safe and fairly recent. However, it’s not so recent that it’s priced at an exorbitant amount but not so old the technology is out of date.
Consumers are not looking for cars with parts that are difficult to acquire. Considering how quickly car technology advances, people also want safety as priority and fewer cars are safer than BMWs. The point is, cars are a necessity and consumers can make smart decisions to acquire the best one – without it being seen as an indulgence. Indeed, though it is a BMW, no one’s first thought when hearing about a used 2012 car is that it is a luxury vehicle.
The contrast here is that we are putting necessity above material desire, but still able to compromise for both. This is possible on all manner of purchasing choices. Everyone – whether seller or buyer – must keep this in mind as we enter an increasingly difficult financial future.