Frequency Times Magnitude Purchase Test
Decide whether to buy something by multiplying how often you will feel the benefit against how big that benefit is, then compare the product to the price.
- Difficulty
- Starter
- Time to result
- ~days to results
- Steps
- 5
- Confidence
- 86%
Sean Puri relays a method from Taimur, founder of the Excel competitor Causal, for deciding whether a purchase is worth it. Break the benefit into two variables: frequency (how often will I get the benefit of this?) and magnitude (how big is the benefit each time?). Multiply them to get the value of the item to you, then set that against the price. The trade-off runs both ways: if the benefit is frequent, the magnitude can be small; if it is infrequent, the magnitude has to be high to justify it. Sean's worked example is a Moaz phone case with a basketball-like traction feel rather than the cheap plastic feel he disliked — tiny magnitude, but he touches his phone constantly, so it scored as a great purchase. The counter-example is his wife's $6,000 Louis Vuitton bag that sits in a closet because she does not want it messed up.
Origin
From a blog post by Taimur, who created the spreadsheet company Causal, in which he tried to work out in a nerdy way how to decide if he should buy something or not.
Core principles
- 01Value is frequency multiplied by magnitude, not price
- 02Frequent benefits can be small and still win
- 03Infrequent benefits must be large to justify themselves
- 04People chronically undercount frequency
- 05Value to you is a separate number from price to you
How to run it
- 1
Estimate frequency honestly
Ask how frequently you will actually get the benefit of this thing — per day, per week, per year. Sean's phone case scores enormously here because he is touching his phone all the time; a better pillow scores because you sleep on it every single night.
Pro tip Count real usage from the last month, not intended usage from your imagination.
- 2
Estimate the magnitude of each hit
Separately rate how big the benefit is on any single occasion. A phone case that feels a little smoother is a small magnitude. A one-off life-changing experience is a huge magnitude.
Watch out Do not let brand or price stand in for magnitude — they are not the same thing.
- 3
Multiply to get value to you
Combine the two into a single value figure. This is where the trade-off becomes explicit: frequent means the magnitude needs to be less, infrequent means the magnitude of the joy it brings needs to be high.
Pro tip Two very different purchases can land on the same value — that is the point of the method.
- 4
Set value against price
Now name the price to you and compare. Sean's framing is that you say okay, that is the value to me, and then what is the price to me, and use that to figure out where you should spend versus not.
Watch out Price to you is personal — the same sticker price is a different number depending on your reserves.
- 5
Apply the correction for undercounted frequency
Before deciding, deliberately re-check the frequency estimate upward, because that is the variable people mostly get wrong. This is the step that rescues cheap high-frequency purchases like pillows and phone cases from being dismissed as trivial.
Pro tip Audit your best purchase of the past year — it is usually something you interact with frequently or a single crazy-magnitude experience.
In the wild
Sean disliked the cheap plastic feel of phone cases and did not want a leather one either, so he found a Moaz case with an almost basketball-like traction feel. The improvement per touch is tiny, but he handles his phone constantly, so frequency carried the score. Against that he sets his wife's Louis Vuitton bag, which she literally never takes out because she does not want it messed up.
→ A cheap case rated as a great purchase while a roughly $6,000 bag sits in a closet for no reason.
Common mistakes
Undercounting frequency
This is the named default failure. People discount a better pillow or a better phone case as trivial because the per-use improvement is small, missing that the benefit compounds nightly or hourly. The frequency term usually dominates the product.
Paying for magnitude you never actually access
A high-magnitude item you are afraid to use has an effective frequency of zero, so its value collapses regardless of price. The Louis Vuitton bag that never leaves the closet is the archetype.
Never running the test at all because of money anxiety
Sean describes bank account dysmorphia — people who have money still acting like they do not, fretting over small sums while a safety reflex blocks any deliberate spending. Without ring-fencing a reserve first, the fear response overrides the arithmetic and the framework never gets used.
Is it for you?
Best for
People who have money but no calibrated way to spend it, and who default to either hoarding or status buying
Not ideal for
Anyone whose spending problem is a budget shortfall rather than a decision heuristic
From the transcript
“It was like the frequency of like how frequently am I going to get the benefit of this? And then like what's the like magnitude…”
“if it's going to be frequent, then the magnitude needs to be less. If it's going to be infrequent, then the magnitude of the joy…”
“And what people mostly get wrong in that is they undercount frequency.”
“my wife bought a Louis Vuitton bag and she literally never takes it out cuz she doesn't want to get messed up”
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