Justifying a Big Purchase

[hcv123]

Originally Posted by x2drich2000

I would guess you're naturally a saver when it comes to finances. There's nothing wrong with that. Your hesitation is really just your body's reaction to saying this doesn't feel right. So I would start by asking yourself why am I hesitant about this? Would spending the money make you feel less secure? Does it feel wasteful? Greedy? Would you be resentful of the card? There is a lot of introspective stuff that only you can answer. Having a good friend/spouse that you can bounce your feelings off of without being judged or telling you what to do/not do is a great thing in these situations.

For me, it really depends on what is going on at the time. I always pay cash so if I don't have enough, I don't get it. That includes making sure I have enough set aside that if something else I want more comes up I can still get that as well. Other things I consider is how easily I could recoup my money if I end up not wanting it down the road and what are the chances I'll see the card for sale again. I can also say that the more I've spent on a card the easier it has been to spend that same amount again, but I always have that same hesitation when I spend more than I have before.

Originally Posted by raulus

I would use a slightly different analysis.

Let's assume that you can't ever sell it. Either because no one wants to buy it, or because no one wants to pay more than $1 for it. And if you're planning to keep it for the rest of your life, then this seems like it's really going to happen anyway, since only your heirs will care about whether it's worth anything.

Based on that assumption, would you get sufficient enjoyment just by having it in your collection for the next few decades (or longer) that it makes your purchase worth it? If so, then it seems like you have your answer.

Typically when I'm paying a gigantic pile of cash for a piece of cardboard, it's because I've been questing for it for a long, long time, and there's a big hole in my collection where it belongs. And another one might not come along again for decades. So I take a deep breath, remind myself how important the piece is to my collection, and pull the trigger.

Great personal example is my recent pickup of a 1959 Bazooka Mays Complete Box. Thread here: https://www.net54baseball.com/showthread.php?t=332462

For me, part of the current calculus is that I've been keeping my powder dry for pieces that are truly that rare. I curtailed my purchases for pretty much all of last year, and focused on paying off the house. Now that I've invested heavily in other areas, I have a lot more flexibility to spend on my collection.

A key element for me is whether the piece is really that rare and difficult to find. Stuff that comes onto the market every few weeks or months? I can buy that stuff next year or next decade when the market has calmed down to what I feel is the right price. If I blow all of my cash today on pieces that I can get any time, then I won't be ready for the stuff that I really want. Stuff that's impossible to find? That's why I've been saving my pennies, so that I'm ready to pounce when those items come onto the market.

In terms of the financial future, I've posted my darkest fears here enough that I don't need to repeat them in great detail again. But an assumption that you can re-sell any time you want and only experience a small loss seems to be overlooking the very real possibility that the current market could tank hard. Particularly given the run up in prices over the last 2 years, with prices in just about every category rising 500% to 1000%, it seems folly to suggest that the market couldn't drop by 30-50% or more. But I seem to be in the minority in holding that opinion. Bottom line for me is I wouldn't base my decision around the expectation that you'll be able to resell it without taking a painful financial hit.

I think both of the above offer incredible thought-provoking responses to your question. The only thing I would add is in the financial side of the equation - If the card is of a "blue chip" player like Ruth or Cobb, I would consider the card highly liquid, resistant to downside risk and easily sold if need be. If the card is so expensive because it is a really obscure "common player" I would share concern as to possible price volatility.