I should point out that I don't normally use the word "amortize" unless I'm trying to prove that something I can't really afford is not just a bargain but practically free. This usually involves dividing the cost of the item I can't afford by the number of years I'm planning to use it, or, if that doesn't work, by the number of days or hours or minutes, until I get a number that is less than the cost of a cappucino.
-- Nora Ephron, The New Yorker June 5, 2006
When I was growing up, G.I. Joe figures were like three dollars a piece, and that was my metric for money. Comics were sixty cents in those days, so a G.I. Joe was worth five comics, and a Transformer (depending on the type) was anywhere from one and a half to thirteen (one and a half being the Autobot mini cars or Decepticon two-pack tapes, while thirteen would be the $40 re-branded Macross Super Valkyrie Autobot Jetfire).
My uncle, when he was visiting from Taiwan bought me thirteen G.I. Joes once, and I have to say, as expensive as Jetfire was, he was worth it in the amount of playtime. The thirteen G.I. Joes didn't even come close to Jetfire, which was one of the few toys that despite the brokeness (he lost his stickers, some of his armor was lost or broken, and his left arm would fall off) that I still kept around. It's because of Jetfire and other toys like him that I take several factors into consideration of purchases -- the evaluation of the whole rather than the sum of its parts.
Now that I'm an adult, I find that I can't really count in G.I. Joes anymore. They've gotten more expensive (9.99 for two) and their play quality has dropped substantially. Add to those factors that I'm just not as interested in toys as I used to be at twelve, and the system of purchasing metrics just breaks down. As an adult, new metrics need to be set -- while I was in college, meals were evaluated into Fat Slice equivalents (3.00 for a cheese slice, 3.50 for the special), and entertainment was counted in CDs (at a rough $15 per) or movies.
Just like the purchase of Jetfire, I needed to figure out some way of justifying purchases which used large sums of money. The answer was simple -- amortize the sum of money into smaller sums over a long period of time. For example, I bought my home theater system in college consiting of 27 inch Sony TV, VCR and Dolby speakers for $600, and it came with a 3 year warranty. At the very worst, if it broke down on year 3 plus one day, I'll have paid $200 a year, or 55 cents a day for the privelege of owning a Sony Trinitron 27 inch TV. 55 cents a day was mere pocket change, the amount that is tossed mindlessly into the change jar -- as far as I was concerned I was practically stealing it from the store for that amount. Surely I could afford 55 cents a day. I'd get cheese instead of toppings on my pizza, or skip the coke machine at work. I'd walk to the next BART station in SF instead of getting on the closest one. I'd cook instead of eating out or I'd buy one less comic book at Comics Relief. 55 cents a day would be no problem at all. 12 years later, those things are all still working -- at least as far as I know. My sister took the TV for her apartment last year, the VCR is gathering dust in my garage, and the huge speakers I sold on eBay. The TV exceeded my expectations fourfold, costing me 14 cents a day instead of 55 cents, which leaves me with an extra 41 cents over 12 years, which amounts to a good $1795 -- almost enough for a new HD Plasma TV, and you know what? It's practically free.
