When watch lovers discuss their latest acquisition or perhaps their pride and joy with friends and family, the reaction that they receive sometimes can be one of disbelief – how could they waste such an enormous amount of money on a ‘watch’.
In response to the quite understandable reaction for someone for whom a watch is something that you use to tell the time, I thought I would share with you my take on this.
First of all let’s be clear – what I’m not talking about here is the question of why a luxury watch costs as much as it does – that question has been asked and answered elsewhere many times and I’m sure that before long I will feel the need to answer it here in my own way…
Secondly, what this is about is relative cost and not priority. I’m not making any judgements on priorities or life choices here, I’m merely making financial comparisons – feel free to spend your hard earned’s on whatever you like and do so with my blessing.
Now that we’ve got that over with, let’s look at some facts.
The most popular watch that we sell is undoubtedly the 1990’s – 2000’s Rolex 14060 Submariner and so we will be using that for this comparison. The lifestyle choices that we’re using are wine, cars and holidays – no judgement here, no question of giving up one to fund another…heaven forbid because I love all of them.
Wine is one that many people don’t think about – if you’re reading this page and you like a glass of wine then you’re probably spending at least£8 – £10 or so for a bottle of your favourite tipple. We are told that a healthy amount of wine to drink is one glass day, and I’m sure that we drink a bit more at the weekends – so let’s say that an average wine lover drinks two bottles a week at £8. That’s £832 a year or a little under £2500 in three years…
I love a glass of Rioja if anyone’s buying…
Cars are an easy one because the figures are readily available – if we keep our sums modest and say that you spend £20,000 on car, then after one year it’s worth around £14,000 and after three it’s worth around £10,000.
The cost of depreciation alone for your car is £10,000 over three years.
So, holidays – if you’re family people with 2.2 children and a taste for foreign travel, a comfortable but unexceptional two week summer holiday won’t give you any change from £5000.
Do that once a year for three years and your total bill is £15,000.
You come back rested, relaxed and you have some great memories.
Now let’s look at your watch.
The initial cost of your Rolex will be £3500 and that will buy you a world class example of a 2002 No-Date Submariner.
If you keep your watch for a year and decide to trade it back in, it’s worth around £3000 and so it has cost you £500. Now here’s the thing – if you keep it three years, it’s still worth £3000 and it’s still only cost you £500. Actually, it may well have cost less because the value of excellent quality watches often increases – I can’t guarantee that it will, but it often does.
In summary, over three years your holidays are costing £15,000, your car is costing £10,000 and you’re spending £2,500 on the odd glass of wine.
All of a sudden, £500 or so on a great watch doesn’t sound too bad does it?