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July 18, 2007


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I think these common "latte factor" type calculations are usually a little overblown (after all, the trick is actually saving the money that doesn't get spent and that's pretty rare) but this is pretty compelling. The benefits are huge financially, mentally, and environmentally. Pretty cool.

I think this concept is very much a legitimate concept. I don't own a TV. There are many reasons for that. One of them is simply the cost of the TV and a nice cabinet (I admit I want a nicer TV in the price range of $800 to $1000). Add then add in the basic cable costs of $35 to $40 a month.

The worst value I see in TV is all the commercials. I resent having to buy a Tivo in order to zap through them.

I like watching TV at friend's houses about once a week. I'll get a TV eventually, but it really isn't that important and it definitely does effectively "program" people to overspend.

I currently don't watch any tv at least on an actual tv. I download/rent all my movies (more of the downloading) and watch them on the computer screen which is more than large enough for me to watch from my couch along with other people. Any tv shows that I do watch, hardly watched any throughout all of my life, I can get online. I just don't see the point in paying for either a separate screen that I wouldn't use, or paying for cable to watch maybe 3 shows a week. Anytime I watched tv back in high school I was bored and didn't feel like doing anything else. I see this problem with my parents where they get home and simply sit in front of the tv and don't do anything. It can't be healthy to deactivate our brains for such a long period of time.

I have to agree with Ryan. The calculations seem overblown, but there are huge benefits to not watching television. My husband and I decided not to get a TV a year ago when we married, even though our apartment complex offers cable at no extra cost. We get so much more done because when we're bored, we have to be proactive and find something to do, rather than just plopping down in front of a TV.

I don't think we're saving much financially, but I think it's definitely an improvement in lifestyle.

I agree that it seems overblown. Cable and movies are sensible but $20 a month for pay per view? I haven't spent $20 on pay per view in the last 5 years. And $525 a month in extra spending due to commercials? That seems way overblown. And then there's the whole factor of what you'd be doing instead of watching TV. Would you be reading, on the Internet, taking a vacation? Guess what, all those things cost money too. There's money to be saved by not watching TV, but nothing close to what they seem to think.

I actually did this two years ago. Well sort of. We got rid of the cable, here in Wisconsin our "basic" cable bill was $60 a month and they sent out a letter saying costs were going up. My kids just sat in front of the cartoon network from sunup to sundown. The first day we didn't have cable I awoke to my 5 year old son watching an infomercial and he quickly told me about how we NEEDED to get this "thing". It was obvious my kids had an addiction, truth be told it's been harder on me, I grew up in front of a TV. For the first month I mopped around the house kicking around projects that I didn't really want to do.

We banked the extra money for 2 months and I used it to buy a long range roof mounted antenna. We get a solid 24 channels FREE, one of which is PBS that my kids will now watch, but first they have to do chores to earn a limited amount of TV time.

We didn't save the money, now we spend the money on martial art's classes for the whole family. I've lost 30lbs and my horrid cholesterol levels have totally reversed preventing me from being put on Lipitor, my wife has lost 20lbs, and my 2 kids are by far the healthiest in their class as both of them are in the top 10% in the presidential fitness tests.

I also finished my muscle car project that was 10 years in the works, sold it, and am using the money to build a master bedroom (by myself) in our attic that will add 500 square feet living space and equity to our home.

So I completely believe the above post. I'd like to add hidden savings as well. I'm sure the lose of weight is saving both my wife and I's knees (both parents have already undergone knee replacements in their 60's) and I've stayed off a life long drug, once on Lipitor always on Lipitor. My kids are as fit as a fiddle, play with the toys they have, and my oldest now reads and writes non-stop.

Now if I can just wean off Netflix and free air!

I'd say 3.7 million is just the tip of the iceburg!

This is bogus. I am picky about audio visual equipment and even I set up a home theater for $1800. But not when I was 25, back then I had a $150 TV. My cable cost is $11/month basic cable. I spend $5 on renting movies, but to be honest I should be spending more and not going out to the theater. I'd say spending $20 a month renting would be a huge moneysaver rather than going out. I don't play games and no pay-per-view. $525 for watching commercials, nope since I mostly buy store brands. Highly exaggerated.

I'm waiting on the day when a PF blogger writes about how to save a $1 million in a life time on the "if its yellow let it mellow, if its brown flush it down" method. I know its coming.

FMF, it's both. The concept is real, but the numbers are definately overblown in my circumstances and probably overblown for most other people.

That being said, you'd certainly be better off without. That's been covered in the comments already, though.

Ted, I don't think that you can save $1 million dollars with that policy (not that it is a bad idea...)

Anyone want to disagree with the $525/month for watching commercials? Who has recently bought a new car in the last year, or two? The latest skincare product, a swiffer, or any of those "No payments until 2008/2009" for a new set of furniture?

The point is that commercials teach us to be not satisfied with what we have (and have already bought) and keep us wanting the latest/greatest/newer/more advanced version.

I currently spend $0 on cable (don't ask), switched my Tivo service ($13/mo) to my Windows Media Center PC ($0). No more Netflix. My projector was a present and I spent $120 on the screen.

However, my electricity bill was $230 this month. No knowing how much of that was my TV watching though.

It can be the cheapest entertainment you can get, or very costly, depending on how you use it, what you spend on it, and what you do otherwise. Initial costs are negligible, monthly costs can be exorbitant. (Mine run $13 and I don't spend a fortune elsewhere.) You should always ask yourself whether this is the best value for your buck or whether something else would be better, but if you are satisfied with the decision, don't regret it.

The real cost is your time watching it. That is easily another 50% of your income, though many employers would not tolerate it.

It is absolutely the way to go! Only, on my blog, I wrote about earning $10 million or more by not building model trains! Of course, I never have built them, but if I start with the same $2,000 and invest the sum of money mentioned in the article, I will get there!

OK, my article was a sensationalized response to the same article you wrote about. I believe the principle is sound, but the numbers are way off for most people. TJ restructured his life, and kudos to him and his family. Most people would find something else just as or even more expensive. Just like everything else, moderation is the key.

Here is the methodology on the $525/month, from the Yahoo article:

"Commercials: A huge hidden cost of TV that people never consider are all the commercials they watch. The commercials are there to get you to buy products -- and they are effective. Economist Juliet Schor estimated that for every hour of TV a person watches each week, he or she will increase his or her annual spending by about $200, according to a 1999 article in the Spokane, Wash., Spokesman-Review. In 2005, Nielsen Media Research reported that the average person watched approximately 4.5 hours of TV a day, or 31.5 hours a week. At $200 in extra spending for each hour watched, that means that the average person spends an extra $6,300 a year due to TV commercials that they wouldn't have spent if they didn't watch TV."

I can't imagine you can extrapolate the $200/hour to any number of hours of TV watching in a linear fashion. I mean, I've had days where I have the TV on for a few hours, and the same commercials come on again and again. Maybe, subconsciously, seeing an ad for a cell phone or a taco causes me to go out and buy a cell phone or taco (I don't think it does, though). Certainly, watching 4 ads for cell phones or tacos doesn't cause me to buy 4 cell phones or 4 tacos.

Anyway, if the $200/year for each hour/week of TV watching is true, it means getting TiVo is an incredibly good investment.

Tv is just one form of entertainment if you didn't spend your money on it I could bet you would spend your money on something else. There are families out there who don't own tv sets, usually one of the reasons is to spend more time together. That more together comes at a $$$ price. A simple trip out for the day/afternoon costs money in transport, food, admittance fees, parking, soft drinks etc. So one way or another the money would get used up it's human nature.

The only real problem I have with their calculations is the fact that they calculate opportunity cost. If you were to take the time you used to watch tv and do something productive then the argument is sound but if you turn around and waste the time another way then I think their argument breaks down.

While opportunity cost was discussed, the article explicitly stated that opportunity costs were not part of any of the overall money-saving calculations. Clearly for some people, the calculations would be way off because they do not spend as much as the article suggests, or they might simply spend it on other things if they didn't have a TV. However, I would have to say that I know a lot of people that do spend the amounts listed in the article.

Personally, I have not owned a TV for 17 years. Have I saved zillions of dollars by not having it? Probably not, although I think it's been sizable thus far. I really think that what the article illustrates most is that any small savings here or there can snowball to an enormous amount if the amount saved is actually invested and allowed to compound for a very long time period.

Blaine Moore (First Time Home Owner) - Oh I don't either, but someone is going to do the math and say it'll be worth $1 million, or some other obscene amount.

Guess I'm the only person here who watches TV, plays a Wii, and has expensive cable. Oh well. I like it and I enjoy it. Do I watch TV every night? Usually. Truth is DH and I are so tired after dinner, if he's not at night school, we turn the tv on and fall asleep with our dogs on the couch. Sure it's not great use of electricity but it's peaceful. I set the tv to auto-time and zonk. Then we get up, walk the dogs, etc. Now instead of sleeping maybe we should get second jobs? I don't think so, we spend enough time apart it wouldn't be worth it. And I'm already crazy enough doing everything around the house while DH works full-time and goes to school part-time. I may not watch a lot of tv, but I love law and order, DH loves survivor still.

So that's us. Could save more? Yes, but honestly we'd save more by not having bought a Wii. Whatever though. We don't have any other hobbies other than biking and our dogs. We don't shop, we do home repair, we garden for cheap, we work on our cars on the weekend, bbq, etc.

Quite interesting reading all your comments on my article. Always good to get a variety of points of view. The main point was that TV is probably costing you more than you realise. Of course, the numbers will vary greatly from person to person and I'm assuming anyone visiting a pf site probably is not typical on how they spend their money, but I think most people would be a bit surprised if you actually tracked the amount of TV you watch.

This is so stupid. Most people who don't have a tv are either too poor or use the money for cable on their bi-polar disorder, if you don't own a tv in this day and age you and your family are wack jobs! My wife and I have 5 tv's, full direct tv service, full cable (it's cheaper to get cable/phone/internet as one package, then it is to get just phone/internet) The difference for us is , she watches fit tv, and cooking show to make us healthier meals. I'm bed ridden from a car accident, have two tv's going at the same time 20 hours a day. One is on bloomberg tv constantly, the other cnbc, c-span, or once in a blue moon the science channel or diy network. You can learn so much from tv, it's an awesome window to the world. The travel channel gives people to see other parts of the world for the cost of cable. We never watch idiot tv which we consider the abc,nbc,cbs along with a host of others brain dead channels. Dam hippies go buy a tv, and stop crying about the price of gas, instead invest in exxon, i've made enough money in that one stock this year to more than fill our suv full of gas free for over a year! It is what you make of it, sit your lazy ass down shoving shit down your throat while watching shit and that is what you will become. Don't Blame The TV!!!

I found this when you linked it from a newer article. I think it is very flawed.

"So what does this all add up to? Say you're 25 years old and you initially spend $2,000 for your TV, DVD player, entertainment cabinet and gaming system after getting your first job. Add in monthly costs of $100 for cable, $10 for electricity use, $20 for renting movies, $25 for buying games and $20 for an occasional pay-per-view event, and you're looking at $175 a month. Add in another $525 a month extra you spend due to the influence of commercials if you are the average person, and you are costing yourself $700 a month watching TV."

If you spent $2,000 on your TV, DVD player, and cabinet, you have a very very nice setup. Our 37" LCD cost about $1000 a year ago, our stand was about $200, and our DVD/VCR combo was a good bit less than $100.

I don't know what sort of cable package they use in the example is, but, for us, digital high-definition cable with DVR is only about $50 a month with taxes. I pay about $92.50 a month, but that includes the high-speed internet costs.

$20 for renting movies is more than I use, but I know plenty of people do this, so I think it is reasonable. As for game buying, one game is $50, so I guess this estimates 6 games a year. That too is probably reasonable for a game player.

I have to say though, $20 is much more than an occasional pay-per-view movie. From local costs, that comes out to 4-5 movies a month which is a bit excessive considering the DVD rental habit the person also supposedly has. The only way this would be acceptable is if the person has some sort of niche football, boxing, or wrestling special event love which can be about $20 a pop.

I sincerely hope the average person does not spend $525 a month on TV related advertising. I'd like to see where that number comes from. I think it may be skewed by the fact that those who do not watch TV are more likely to be the same people who do not consume other big-ticket items in general. That said, I still cannot imagine I spend more than $100 a month in spending that is influenced by commercials, and I think that is even a stretch.

I disagree with the numbers, but partially agree with the conclusion for one entirely different reason. I believe watching the SHOWS has many many people poor. How did that happen? Many of the popular shows depict elaborate lifestyles and unchecked spending which skews our perceptions of reality. How many people live "The Real World" lifestyle with about a dozen college age kids living in a mansion on the beach and having to work only a few hours a week? How many children want something because their favorite TV character has it? Most importantly, do we need the large fancy homes and flashy cars portrayed on many TV shows. You might not spend an extra $100 per month at McDonalds, but if you buy a house 30% more expensive than you normally would because of watching HGTV, it can add up pretty fast.

Wow, I think that I can do it.

It'd be interesting to see how the "money spent because of commercials" figure is built.

Additionally - you mention 'lost opportunity costs' ... for many people, that would be 'opportunity' to spend more money. A 1 dollar DVD for 4 people offers quite a bit of enjoyment on a per dollar basis. If you weren't watching that movie, you might be out doing something more expensive (or cheaper - has anyone actually looked at what TV-less people do with their time?)

Hey!, Wow, I think that I can do it.

Wow thats a big deal ! I want to particpate!!

Well this would work if all we spent our money on would be TV..but it's not...I mean if we cut the TV expenses we would find some other ways to spend that money..ok some of us would try it..and might even make it..but ask yourself is money all that matters...what does it matter if you even have a billion $$ if you're 70...I mean enjoy it while you're least that is my opinion...

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