Hedonic adaptation, Lamborghinis, and whether spending money on experiences vs things always makes sense.

I've seen lots of headlines in the last few years that talk about how spending money on experiences versus "things" can make more sense. And while I'm personally a big believer in that, I also know there is the tendency to overspend on experiences.

Hedonic adaptation - the diminishing of pleasure through repeated exposure to something - applies to experiences as well. Further, it's said that we compete on what we can see and therefore "things" drive the competition to spend more because they are more visible. But keep in mind that in the era of social media, experiences as just as visible as things these days.

Spending on experiences may be better than on things in many cases. But not spending money you don't have trumps all strategies.