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Cheap is Expensive

October 7, 2019

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This article is written by Ramanuj Mukherjee, CEO, LawSikho.

I grew up in a household where money was scarce. In my early childhood, I saw the crazy inflations of the early 1990s as a kid, when the government salary of my father was not enough to run the household of two adults and two kids. Almost inevitably, towards the end of the month, my parents ran out of money, and we had to ‘manage’ somehow.

Sometimes my mother would skip meals to ensure that I and my sister were fed. There were times when we could not pay the electricity bill and lived without it.

Things got better over the years, especially when my mother found a job as a teacher in a high school.

So I grew up in a household where scarcity and poverty and existential threat were not just concepts but palpable, tangible realities.

So I learned all the survival skills of a poor Indian. Things like bargaining, searching endlessly for the cheapest option, being wary of expensive things in general and skepticism about so-called opportunities.

There was a lot of skepticism and defeatism in the environment I grew up in. It’s common in all lower middle class and poor societies. I grew upright in the middle of that, where people believed that it was their destiny to remain stuck in that situation.

I did not believe that. I always dreamt of bigger things. I believed that I am meant to do something great with my life. People derided my confidence and dreams, but nothing deterred me.

Nonetheless, you cannot outrun your upbringing.

A few of the many things that I learned from that environment, stuff that got ingrained in my fundamental built, are things that I still fight every day to make progress.

For instance, lack of order and discipline. Nobody kept a calendar in my household. Nobody had a weekly productivity plan. Nobody had goals or a method to achieve those goals. My parents did not work out or learn new skills every year.

So it is hard for me until this day to be disciplined, or to work out every day at a fixed time. It took me a long time to learn to use a calendar and manage it effectively.

On the other hand, I learned other habits that served me once upon a time but does not serve me anymore. Such as bargaining with the auto driver or the vegetable vendor for 10-20 bucks! It is a drain on my time and energy, and it is totally harmful because I am spending my precious time focussing on things that are inconsequential. It is still hard for me to stop myself from doing it.

I also have a devastating tendency of buying cheap things. For a while, I would buy the cheapest protein powder, only to realize later that the cheap quality product was injurious to my health!

I bought cheap phones and laptops in the beginning, only to learn later that those cheap things were very expensive, because they broke down sooner, while my current Apple MacBook Air has lasted me already for 4 solid years and there is no sign of wear and tear. It is almost as if it is still brand new!

My current phone has lasted me for a solid 3 years, and while the battery is a bit weak these days, there is almost nothing else that is wrong with that phone. I have a habit of dropping my phone from a table or a bed now and then. This sturdy phone has not gotten a scratch even. When I bought cheap phones, they will give up within a year, or shatter even earlier if I dropped it by mistake.

Over time, these expensive gadgets have paid for themselves many times over.

There was a time when I would buy a cheap mattress or a mediocre keyboard. I would take the membership of a gym because it was cheap. Remember that by then I was earning substantially well, and I was going for the cheap thing because of my mindset, and not because of sheer budget constraints. What a crazy thing.

I sleep 7-8 hours in my bed. Is saving money, say Rs.10,000, by not buying a good mattress, really worth it? What is the price of good sleep if I work 14-15 hours a day? What is the price of my spine getting the right kind of rest it needs? What is the price of quality, deep sleep that really rejuvenates me to function at my best the next day? I count my amazing mattress as one of my greatest possessions.

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What is the price of a keyboard if it can help me to type faster and more accurately given that I type out 5000 words a day on average? Check out ergonomic mechanical keyboards with finger feedback.

What is the price of going to the wrong kind of gym, and not getting a good work out? What if I go to an expensive but life-changing gym that gets me addicted to working out? That is what happened when I went to Rs. 5000 per month CrossFit gym!

For a long time, I hesitated to invest in apps, courses, and expensive books that can elevate my performance and results in life. I was happy to buy cheap books and lots of them, but I used to balk if the price was a bit higher. I would expect that a cheaper version will be launched in India someday when I would buy it. What a stupid thought for an entrepreneur trying to build a world-class company.

That thought process is perfectly justifiable for a middle-class kid, or someone buying novels for a pleasure read. As the CEO of a fast-growing online education company, that quadrupled its revenue in the last 15 months and tripled team size, can I afford to wait to learn things?

What if I have to hire a very expensive agency, or a consultant, or a software? Can I refuse to grow my company because I hate expensive resources? What would be the cost of failure to make timely purchases?

Should I hire someone at a higher salary than what I pay myself in my own company?

Can I delay critical business decisions because I am scared to spend money?

I need to be cautious, but I need to be bold as well. I need to make the right calls about business expenses, and investments, failing which either my business will miss important opportunities, while if I go overboard we run the risk of screwing up again!

My childhood instinctive of bias for cheap things does not always help. My childhood instinct for frugality and looking for a bang on my buck, however, goes a long way. Still, I have to learn a lot to keep my instinct for the cheap thing in check and truly look at what is of value to me.

Make a list of things where you are scrimping or scrounging at the cost of your well being, without any real economic justifications.

Where are you compromising on your well-being to save money?

Where are you compromising your long term growth in order to save money?

Where are you scared to spend money irrationally, although you know it could change your life, or put your career in a different orbit?

We all have a few of those. Make your list. Tell me if you enjoy doing this exercise.

If there is a course that comes at a premium price tag but promises to give you 10 times RoI, provided you do the work given to you, will you be interested? Or will you back off because you don’t want to spend so much, and ignore the profits you would earn from the skills you are going to learn?

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If you are interested, I request you to check out the courses below. While you do so, practice this. Calculate the value you could get out of a course you want, and compare it with the price.

Can one of these courses increase your salary by 30-50% per month? Can you double your income as a lawyer? Is it possible that if you learned these skills you will be able to earn a lakh or two more in the next 12 months? How about the rest of your life?

What if you can get an out of turn promotion or land a big client? What is the value of that?

What if you can earn the respect of other lawyers, peers and potential clients? What is the value of that?

What is the value of you feeling confident and powerful about your own legal knowledge and skills?

Please check out these courses with these questions in mind:

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Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution

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Diploma in M&A, Institutional Finance and Investment Laws (PE and VC transactions)

Executive Certificate Courses

Certificate Course in Companies Act

Certificate Course in Trademark Licensing, Prosecution and Litigation

Certificate Course in Labour, Employment and Industrial Laws for HR Managers