just_hatched
Recycles dryer sheets
- Joined
- Sep 12, 2005
- Messages
- 97
I've read the mental accounting paper and I have also been intrigued about the perceived value of monetary amounts.
The other day I was wondering if the perceived value could sometimes be correlated with one's net worth.
For example, what about an amount of .01% of net worth? Sounds very small. So for someone with $1 million, then this would be $100.
How much would a millionaire "care" if he or she lost $100 even if his or her portfolio fluctuated up or down by $1000 that day.
What does the perceived value of $100 mean to someone who has $1000 in the bank versus someone who has $1 million or $10 million?
For me personally, as my net worth has grown year to year, the occasional $200 car repair seems less and less impacting each year.
The other day I was wondering if the perceived value could sometimes be correlated with one's net worth.
For example, what about an amount of .01% of net worth? Sounds very small. So for someone with $1 million, then this would be $100.
How much would a millionaire "care" if he or she lost $100 even if his or her portfolio fluctuated up or down by $1000 that day.
What does the perceived value of $100 mean to someone who has $1000 in the bank versus someone who has $1 million or $10 million?
For me personally, as my net worth has grown year to year, the occasional $200 car repair seems less and less impacting each year.