The Purchase Experiment
Test an aspirational purchase before making a lasting commitment
- Difficulty
- Easy
- Time to result
- ~days to results
- Steps
- 5
- Confidence
- 95%
The Purchase Experiment replaces speculation about an expensive product with a small real-world test. Begin by stating what benefit you expect the item to provide, then rent, borrow, or sample a close equivalent in the context where you would use it. Pay attention to whether the experience creates genuine value or merely admiration for the product's design, performance, or status. Compare the observed response with the original expectation and commit only when the trial confirms that the item serves your actual preferences. A negative result is valuable because it prevents a much larger mistake. The method is particularly useful for aspirational purchases that people feel they ought to enjoy because peers, advertising, or social media associate them with success.
Origin
Extracted from Masters in Business through Carl Richards's account of Morgan Housel periodically renting a Porsche to test whether he truly values owning a performance car.
Core principles
- 01Admiration is not the same as personal value.
- 02Small trials reveal preferences better than speculation.
- 03Repeated experiments can test whether tastes have changed.
- 04A purchase should reflect what is true for you.
- 05Walking away after a test is a successful result.
How to run it
- 1
State the expected payoff
Write down what you believe the purchase will add to your life, such as enjoyment, convenience, connection, or performance.
Pro tip Describe an observable benefit rather than saying the item will simply make you happy.
Watch out Watch for expectations borrowed from advertising, peers, or social media.
- 2
Design a low-commitment trial
Find a representative way to rent, borrow, sample, or temporarily use the product before buying it.
Pro tip Run the trial in conditions resembling your normal life.
Watch out A showroom encounter may overemphasize novelty and underrepresent ownership.
- 3
Observe the lived response
Notice whether using the item delivers the expected benefit and whether that value persists after the initial excitement.
Pro tip Distinguish appreciating an object's quality from wanting it in your daily life.
Watch out Do not reinterpret indifference as enthusiasm merely to defend your original desire.
- 4
Compare evidence with expectation
Assess which predicted benefits appeared, which did not, and whether the likely value warrants the full cost of ownership.
Pro tip Include maintenance, storage, financing, and opportunity costs.
Watch out Do not let the small cost of the experiment pressure you into making the larger purchase.
- 5
Commit or walk away
Buy when the evidence shows the item creates meaningful value and fits the budget; otherwise decline it confidently.
Pro tip Repeat the experiment later if you genuinely believe your preferences have changed.
Watch out A decision not to buy is useful information, not a failed experiment.
In the wild
Every few years, Morgan Housel tests his belief that he should be a car enthusiast by paying extra for a Porsche rental during a business trip. He quickly recognizes that although he admires the vehicle's beauty and engineering, driving it does not provide what he personally needs.
→ The temporary rental confirms that buying the car would not deliver sufficient personal value.
A buyer considering an expensive espresso machine borrows one for a week and records how often it is used, whether the ritual is enjoyable, and whether it replaces café visits. The test shows that setup and cleaning outweigh the convenience they expected.
→ The buyer avoids an expensive appliance that would probably have gone unused.
Common mistakes
Testing only in ideal conditions
A luxury experience on holiday or in a showroom may not reveal how the product fits ordinary routines.
Confusing admiration with utility
Recognizing that an object is beautiful or well engineered does not mean owning it will improve your life.
Treating the experiment as justification
The purpose is to gather disconfirming as well as confirming evidence, not to create permission for a predetermined purchase.
Is it for you?
Best for
It is best for expensive, identity-laden purchases that can be rented, borrowed, sampled, or otherwise tested first.
Not ideal for
It is less useful when no representative trial is possible or when a purchase is urgent and essential.
From the transcript
“Every couple of years he runs an experiment which I just thought was beautiful”
“give me the Porsche.”
“Either way, run some experiments, find out what brings you value.”
From the episode
At the Money: Smart Spending vs. Not Spending