A recent thread, found here, over at EDCF got me thinking about just how much is too much to spend on a given item. For me there are two rules that I consult when making a decision about purchasing just about anything--a TV, a new router (because you can never have too many routers), or a new folding knife. One comes from the head engineer and designer from NAD, a higher-end electronics company. The other comes from one my favorite internet celebrities--Mark Spagnuolo, aka the Wood Whisperer.
The 10%/100% Rule
According to the first rule, you have the reached the rational limits of spending, when a 10% increase in performance costs 100% more. To state it another way, you have reached the rational limit when a little bit better costs twice as much. This rule, it seems to me, sets the upper limit. There are plenty of times when the "rational spending limit" occurs well before the 10%/100% rule kicks in. I think, however, that it is safe to say that there are NO rational expenditures BEYOND the 10%/100% rule.
One comparison we could look at would be the infamous San Re Mu to Sebenza comparison. Here is a thread on that. The SRM 710 is a direct rip off of the Sebenza, and while it has its fans, it just doesn't seem like something I could rely on. There is virtually no manufacturer information on the knife. Its parts and materials are somewhat mysterious. So for me, it is not even on the list of comparables. Instead, let's compare the Sage II, the Small Sebenza 21, and the Scott Cook Lochsa.
None are bargain knives, like the SRM710, but all of them are something I could easily see someone carrying as their primary EDC. They have similar materials and designs: S30V or S35VN steel, titanium handles, and a frame lock. The Spyderco has all of the Spyderco trademark design touches--the finger choil, the leaf shaped blade, the thumb hole, and a wire clip. The Sebenza, well, I covered that here. The Lochsa, while subject to very limited availability, has a Sebenza-like look to it (it should, Scott Cook is a former CRK employee). The handle has more curves in it and the entire thing is chamfered around the edges. Finally, in an amazing display of craftsmanship, the Lochsa handle is carved from a single billet of titanium--there is no backspacer, or pillar construction. And now for the prices:
Sage II: $149
Lochsa: $675 (S90V steel)
For me, the 10%/100% rule puts the limit of rationality on the Sebenza level. Here is why: the Sage II is a great knife, nice materials and design, but it is WIDE in the pocket. All Spydercos are, by their very nature. The thumb hole makes them fatso pocket friends. The Sebenza, on the other hand just disappears. It carries like a vastly smaller knife, and this is one of the reasons I think it is just about perfect. And this is certainly a 10% increase in performance. Thus, at this level, we meet the 10%/100%. The knife is a bit more than twice the cost, but it does perform 10% better in my opinion. So for me, it is a rational purchase.
But then we compare the Sebenza to the Lochsa. Suppose you could just buy one off the shelf, the Lochsa is about twice as much. And now with the upgraded CRK steel (S35VN), there is not as much of a difference in performance. It comes down to the single piece handle design. While I definitely think that is an amazing feat, I am not sure it makes the knife all that much of a better cutting instrument. It does not increase the performance 10% over the Sebenza. As such, the 10%/100% rule says that is an irrational upgrade.
Three quick points about the 10%/100% rule. First, the 10% increase in performance is based on your own personal assessment of performance. If pocket carry means nothing to you then the rule may draw the line of rational purchasing at the Sage II. Second, the rule was designed in the high end audiophile industry and thus is HEAVILY favored towards spending more. It should not be used as a lower limit, but instead the very upper limit of what is reasonable to spend. Third, the rule cannot be used when collectibility is a concern. A 1952 Topps Mickey Mantle does not PERFORM better than a 1983 Topps Willie Hernandez, but one is VASTLY more collectible and hence more expensive than the other.
Pushing the Limits Rule
If you are a woodworker and have not checked out the Wood Whisperer's site, you are missing most of the newer innovations in the hobby. Marc hosts a podcast and a lot of the podcast deals with tools and woodworking challenges. They take questions from people and one of them had to do with when should one upgrade from "box store" block planes to high end block planes. Even without knowledge of what a block plane is, Marc provided a very good rule of thumb as to when one should upgrade. Essentially he said that tools should be upgraded when, during your regular use, you reach the limit of the given tool AND you know enough about what the limiting factor is that you can meaningfully purchase an upgrade.
The rule has two parts:
1) you've reached the limit of your current gear; and
2) you know why you have reached that limit, enough to know what you should look for in your upgrade.
Maybe it is the lawyer in me, looking for tests, but this one seems to work well when determining when it is time to start the upgrade hunt. It is, in a sense, the opposite of the 10%/100% rule. It is the lower threshold principle. Flashlights make a great example.
Every night we try to go for a walk with my infant son. We go for a stroll down to a local high school football field. During the summer all sorts of people use the field, some of them somewhat unsavory (or potentially unsavory) and so I like to be able to see them coming a ways away and avoid them. My Muyshondt Aeon, great as it is, can't light up things across a football field. But my Surefire G2X Pro certainly can. And so my regular use both showed me the limits of my current tool and what I needed in an upgrade.
I think these two rules work very well together and help you from going CRAZY doing research and spending money. Sometimes it is inevitable. Sometimes you just WANT that new light. But following these rules can help you avoid purchasing mistakes. One last thing, buy EXACTLY what you want. Buying a close approximation of what you want, will only leave you wanting. Save up, and get EXACTLY what you want. There is a premium in getting the "perfect for you" item.