Comparison: Buying Wine and Buying a Car

A car is your second greatest expense after mortgage/rent. Wine can be expensive, but doesn't require a loan (I hope). What the automakers call an entry-level luxury car costs $40k. More of a standard lux vehicle is in the $55k range. The wine industry says premium wine starts at $20 and it becomes a luxury good at $50 a bottle.

So how are the purchases similar?

Your budget

Some people aren't willing to pay more than $15 for a bottle of wine. Some only buy cars that arealready at least three years old. There are folks driving a 15 years old Chevy buying $100 wines and there are others with a new Mercedes that won't spend $20 on a bottle. It's not just what you can afford, but what's important to you and what you appreciate.

Many just want a car that is reliable. Many want a wine that isn't offensive and don't need more. Some appreciate the luxury and/or performance of a nice vehicle. Many appreciate the flavors and complexity of a great, and expensive, Pinot Noir.

Showing off

Yep, ego definitely plays into both purchases. How you are seen on the road matters to many. I'm not excited about being seen in a pink or purple vehicle. I would be kind of embarrassed to be seen in a Smart car or a Humvee, but that's just me. Most people buying a big azz $50k-plus SUV don't need a 20 foot, 5000 lb truck, but buy it to make them look a certain way on the road.

With wine, especially if it's opened around friends, can be seen as an ego-booster. For this you might get something rare, something expensive. Is it actually better than that $40 mass-produced wine? Who cares! Is a $100k Mercedes that much better than a $30k Honda? Who cares! It's perception.

Ah yes, conspicuous consumption, the folly of the leisure class. Buying a luxury car, luxury wine, or an expensive piece of art is rewarding yourself for your hard work. It's something behavioral economists study.

Going green

Green is in. That's electric for vehicles and organic for wines. Either way you feel better about your purchase because you're saving the planet. No chemicals in your wine, no exhaust from your car.