The $18,000 iPod

by Nick on January 13, 2012

What were you doing on October 23, 2001?  If you were buying the first generation iPod for $399 you probably were the coolest kid in school the next day. 

Ten years later, however, that iPod’s probably gone, you’ve hopefully graduated and you’re maybe the fourth coolest girl in the office (who am I kidding…Step Away from the Mall readers are the coolest people in the office!  OK, so you’re still the coolest.).

But what if you took that $399 and bought Apple stock, which was trading at the equivalent of about $9 per share after splits.  Well that $399 would be worth about $18,000 today!  Hope you like the iPod!  :) 

Seriously though, I bring this up to make a few “points to ponder” this weekend.  We’ll do little bits and limit this to three: 

  • There are rarely only two alternatives.  Extreme examples like this get you to focus on “what else” you could have done with your money.  You could have just as easily bought Enron stock and seen the company file for bankruptcy six weeks later. You could have done nothing with that money and still have $299.  You could have donated that $399 to a charity, given it to a friend or anything in between.  So when you’re in the freakin’ mall this weekend buying that sweater hear my voice asking whether there are more productive things to do with your money… Maybe spend half of what you were planning and throw the other one in a Roth IRA.  I realize you don’t know my voice, so just think of the manliest voice you could imagine… then think of the opposite of that…   ;)
  • If you think “save or invest first” over the long term you’re probably going to be way better off financially. “Frugal” folks’ first instinct is to save or invest first.  Automating savings and investing is a great way to make sure that you have a saving and investing mindset – even if it’s only the back of your mind. 
  • Learn from your decisions.  It’s not fair to call buying an iPod instead of Apple stock a “mistake” (especially because single stock investing is risky and stressful) but every once in a while it’s good to reflect on the decisions you’ve made.  Don’t beat yourself over it – spilled milk – but learn from it.  Maybe buy an index fund instead of the iPad3 next year … or buy a used first generation iPad or iPad2 when the third generation comes out and the prices drop and throw the difference into a Roth IRA.  The possibilities are endless.  Trust me, if you’re living without an iPad3 now, you can probably live with an iPad3 six months from now.  Right?  So learn from the past.  I’ve learned quite a bit from the dumbest thing I’ve done to date

By the way, these numbers are off because the post is old, but here’s an interesting chart of “what ifs” with virtually every Apple product you could imagine through August 2010.  If you want a rough current number, as of yesterday Apple’s stock is roughly 55% higher than it was on the date that chart was published.  So multiply those numbers by 1.55 and there’s your rough “what if” number.

Anyone buy the first generation iPod?  Anyone buy the stock instead?  Don’t kick yourself.  I’m just having some fun here. 

Until next time, put your credit card down and slowly step away from the mall!

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Image: dan /

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{ 1 comment… read it below or add one }

ihavetriedit January 13, 2012 at 3:14 pm

I spent $300 on my first iPod. I still have it! I have not been able to get it to sync with my new computer, though. Wish I would have bought stock in the company instead!


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