Are You Addicted to Purchasing Expensive Brands?

There are many people around us who are addicted to buying expensive brands. You can find many of them in Indian middle & upper class families. These people spend money on expensive brands to project a situation that is better than their real situation to impress people (friends/relatives/neighbours) with their material possessions. They think low-priced products are not of their range/status. They are very attached to products that are heavily priced, assuming they are only the good products available in market.

It is easy to get carried away with the thought – “I am making good money, why should I not make expensive purchases”. But such thinking reflects a bad attitude towards personal finance. Wrong attitude towards spending will make you regret later, as you would not make enough savings for future financial needs.

Who are expensive brand addicts?

  • People who cannot see or don’t want to see the brands that are cheaper or inexpensive yet functional and have good quality.
  • They purchase clothes from a specific brand or brands that are very costly. They don’t even attempt to see what other inexpensive options are available.
  • They spend high amount of money in order to get social recognition.
  • They assume only highly priced clothes have good fittings or high priced mobiles only will have all features. They can’t even think of spending less than Rs 2,000 for a shirt or Rs 20,000 for a mobile (While good shirts at Rs 600 to Rs 700 and good functional mobiles below Rs 5,000 are also available).

Why people buy expensive brands?

  • Ignorance: They don’t know that there are many other brands (inexpensive) that offer great value. They overpay heavily to buy brands that are almost of same quality as other options. You can see same cloth, same fitting, only the brand will be different and price will be significantly less.
  • Lack of perspective and judgment: They cannot assess quality on their own. They assume spending more is the only way to get a good product.
  • Attachment with high-priced brand: Some people are very attached to same high priced items that they can’t even adjust with regular ones. They say – “ I will not use or wear even if you give it for free”.
  • To show off status: These people are not buying for quality. Their primary motivation is to show-off. Even if a product is available at lesser price and it is more convenient – physically, emotionally, logically, they still go for the expensive one.
  • Insecurity: People without inner self confidence tend to buy branded products in an attempt to carry their insecurity.

How to get out of this misconception?

  • Actively work to get clarity on the products/brands available. See, research, discover the functional products at lesser price.
  • You need to evaluate from functional point of view. You need to look for durability, reliability, convenience and quality of the product.
  • You need to look for alternative brands that are inexpensive with the same features.
  • A cost-benefit analysis of features/quality with pricing need to be done before a purchase. Identify the opportunity cost.
  • There are others who have a false belief that all expensive brands provide suitable value for the high price. This is always not correct.
  • Not to have a closed outlook to lesser known brands. This is important to avoid missing good brands that are lesser known and also helps evaluate from a functional point of view.

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