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iPad 2 Review & Your Financial Conscience

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For the most part I know that Financially Digital is not a breaker of news. Odds are when you come here you won’t be reading about the late breaking announcements from any industry. That being said I do want to cover the announcement of the iPad 2 and how it may or may not be a good purchase for you. With technology like this or any purchase really, I think we have to start by placing a product like this in either the “need” or “want” buckets. For me personally, I love and abuse my first generation iPad. (Now improved: Cheaper!) I take it everywhere with me and it has become an invaluable tool for me in my day to day business needs. Whether or not this next iteration is a “need” or a “want” is still out but I’m guessing at this point it’s circling the rim of the “want” bucket. I don’t want to get into the heuristics of spending or budgeting too much but know that you should approach purchases like this with objectivity: if it’s a toy your buying call it a toy, if it’s a tool then call it that. Leaks happen in our budgets when we move away from objectivity and start to rationalize! Straight from the Apple Site

A quick run down of some of the specs right from the Apple website for you:
  • A5 Processor - upgrade to the A4 in the iPad and running 1GHz dual-core
  • 33% thinner profile than then first iPad
  • Storage is in the same increments: 16GB, 32GB, and 64GB
  • Available in Wi-Fi and 3G from both AT&T and Verizon
  • iOS4 also becoming available to first generation iPad on the 11th
  • No sacrifice of battery - still up to 10hrs
  • Back camera: Video recording, HD (720p) up to 30 frames per second with audio; still camera with 5x digital zoom
  • Front camera: Video recording, VGA up to 30 frames per second with audio; VGA-quality still camera
  • HDMI video mirroring and video out capabilities - which will be huge for presentations let’s say or for teachers
  • It will be up to 9x faster for graphics performance and gameplay - hopefully that means a better UX as well
  • What I really thought was cool was the magnetic blackberry-esque cover that shuts the device down and starts it up when you apply and remove it. It also folds and doubles as a stand.

Ok enough with the geeking out over the specs. I think those are really the big things that would’ve come out of any announcement. Out of box you’ll still get what you would in the first generation iPad: documents, cables, and device. The price points are starting at $499 for the 16GB Wi-Fi and then it climbs from there. There is a reprieve to those customers that purchased the first generation within 2 weeks of the release of the iPad 2. Those customers will be able to send out for a $100 rebate matching the new price points on the first generation iPad. Everyone else like me who bought it outside of the 2 weeks but way less than a year ago are...stuck.

On to the purchasing of the device! $499 is not a small amount regardless of you level of income. One of the biggest issues that you have to consider is opportunity cost. If you’ve ever sat in on any of my Economics courses then you’d know how much I stress opportunity cost and doing your personal cost/benefit analysis. Opportunity costs are the costs of what you could be doing with the money that you would spend on the iPad 2. At the very least that money could be earning interest. Now, is that interest worth more than the possible utility you would get out of owning the device? Is that interest worth more than the additional income that would be generated if you are using your iPad 2 in a working environment. If it’s not earned interest your worried about then it might be a bill’s payment or just the purchase of something else.

Next is your budgeting. First of all, are you budgeting because you should be! If nothing else, some kind of formal way to keep track of cash inflows and outflows. If you need help with that check out what I think of Mint or of DIY’ing it. If you are budgeting then odds are you might have some categories in there for work expenses or for fun stuff. I would encourage you to try to categorize a purchase like this properly. I mean you don’t want to take away from other stuff you might be working towards like vacations or even your emergency savings! There’s no shame in not being one of the first consumers of the device, creating another bucket to save in for the iPad 2 is a great way to work for it productively - and without harming your financial situation.

Utility and priority. Personally, I’m kind of a tech junkie. I run a few monitors and hardrives at a time. I was one of the first adopters of the netbook. I love my smartphones and most recently my iPad. For the most part I justify these purchases and upgrades around my consulting practice and I’m usually pretty good at honoring it. Especially with the iPad these days. I would be lying though if I told you that it was the utility I get from using this stuff for work was the only utility. Priority goes hand in hand with this. Where do your sense of urgency's reside? Making sure that whatever you spend your money on goes hand in hand with your missions statements and plans is so important. Remember it’s more than just budgets and identifying your spending behavior - these are your hard earned dollars.

My verdict. Well I think I’ve convinced myself that I want the iPad 2. Do I need it right now, not so much. Will I be budgeting for it - absolutely! I know that I’ll get to see the iOS4 when the update comes out this Friday so I should be able to hold out on purchasing the device right off the bat. Could I rationalize it right now - definitely. But I know that just indulging my geekyness won’t directly relate to more dollars in my pocket because the marginal gain in utility won’t make me that much more productive. What’s the case for you?

Are you planning on being one of the first inline for the iPad 2? How are you budgeting it in? What are some of the opportunity costs that you are dealing with? Let’s start this conversation in the comments below!

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Reader Comments (1)

There's nothing to discontinue you from moving the iTunes, App Store, iPod and Game Center icons off the first screen. It just takes a second for the screen to vary when you hold the icon near the edge. This is really very nice and the cost is also not so expensive. Payday loans with bad credit

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