TOO much!! : knowing when and how much to invest. Pt 1

It seems like Tuesdays are always the day when things can become too much very quickly... For instance, if someone has been texting you consistently since monday and you haven't answered them, then by Tuesday you're probably saying it's starting to be too much...yea, too damn much. So to pay tribute to Tuesday and its ability to capture the essence of too-much-ness, I want to talk about knowing when you're putting too much money into an investment and when your putting too much money in to investing... We'll refer to this as over-investing. When we take a look at the assets that are partly investment goods and partly consumption goods we must understand why they are just that. These goods include cars, homes, boats, etc. The assets are considered investment goods because they are able to be re-sold in the future. They are considered consumption goods because the owner is able to use the asset while he or she owns it. Since the number of people that own cars is greater than the number of homeowners we'll explore how one could over-invest in a car and how one could avoid that as well. When people decide to invest in an asset like a car they often confuse its consumption value with its investment value simply because of the benefits they get from owning that car. This causes them to arrive at a justification in their mind as to why they're prepared to spend more on the car, than what it's truly worth on the open market. For instance, buying a car with a poor 36 month resell value history wouldn't be the ideal investment into a car but the fact that the car comes with navigation and automatic leather seats may move the investor in a direction to overlook the poor data. If an individual buys a 12 year old car for $2,000 and invests $2,000 into that car, they can rely on the fact that the car will never resell for more than $3,000 and it is fair to say that they over-invested $1,000 into that car. To avoid over-investing in this manner you have to consider the size of the good you're consuming. Is it a larger investment than you would normally make on a car? If it is than you will benefit from justifying that larger investment/consumption with an investment value that has no consumption value priced in. Judge the price of the car you have chosen, based on other cars similar to your chosen vehicle. This will give you a clear perspective on the value of that asset(car) and thus the value of investing in it. Once the true investment value is clear to you it should be easier to create a realistic consumption value by comparing what benefits you will gain from that car while owning it and other you could purchase.  This method of weighing investment value and consumption value separately makes it much easier to compare investment opportunities. Of course these aren't the only ways of over-investing, in-fact, there are different ways specific to every asset. This is just a small look at what the core problem really is...Weigh personal interest and financial interests separately because combined they cause confusion and promote bad decision making. Remember to keep in mind that no matter when you're spending, spending based on necessity will outweigh the pleasure of consumption forever. That means,
"buy what you don't need and before long you will have to sell what you do need."         -Benjamin Franklin-
Hope that wasn't too much, lol. =) ...Keep your mind happy, and keep your money for needs.