DIFFERENT WAYS OF MEASURING

I often hear bitter people moaning about how the rich "waste" their money.

"How can you waste a hundred (or a thousand, or ten thousand or whatever) dollars on such a silly thing? It's sooooo not worth that much." They'll say. For example, let's picture a very very rich kid who enjoys Magic the Gathering. In order to win just a little more often, the kid buys a super powerful card for 1000$ from Ebay. What an idiot! How dare he throw away such a large sum on something so trivial? Doesn't he realize how hard it is to earn a thousand dollars?

The answer to that question is "You're counting the wrong way". As in, you're not picturing money in a way that would allow you to answer your own question.

Let's say a kid from Bangladesh comes up to you and asks "How can you be so stupid as to waste a whole dollar on a can of soda? That's a day's work!" What would you tell him? Probably something along the lines of "One dollar is really not much to me". Well, the difference between you and that kid is about the same as the difference between you and the rich kid. So associating a specific amount to a specific good is meaningless. What you need to ask is "How much TIME would I be willing to dedicate to acquiring this good?", because that's really what you are doing when you're buying anything: you're exchanging a given amount of paid work that you have done in the past for something that you need or want now.

So let's say you earn 10$ an hour, and you want that 1000$ card. What you are spending is 100 hours of revenue. But if you earned 1000$ an hour, you would really only be spending one hour of revenue. If you earned 100000$ an hour (as quite a few people actually do), that card would be worth 36 seconds of your work, and so on.

Would you spend 36 seconds of your time acquiring something that you think you will enjoy quite a lot? I bet you would. Let's say you had a bank card with an arbitrarily large sum of money associated with it. The concrete result of having such a card would be that you could swipe it anywhere to acquire anything, and the amount still available would not change in any significant way. That's exactly what rich people are doing : spending a negligible fraction of a day's work on something they want. Whereas that negligible fraction will get you a can of soda, their negligible fraction will net them a brand-new car for their collection. But deep down, you're both doing the same thing.

That's why if you want to fantasize about your "perfect rich life", ie what you would do if you were a billionaire, you don't ask yourself "What would I do if I had a billion dollars?" but rather "What would I do if everything was free?"