Five expensive purchases Filipinos mistake for investments

True investing focuses on returns, risks, costs, and resale value.

A ₱300,000 designer bag, a ₱5-million SUV, or a diamond necklace might make you look wealthy. But these purchases could actually be draining your money.

Many Filipinos justify expensive purchases by calling them “investments.” The problem? Some depreciate, carry hidden costs, or become difficult to resell.

Here are five examples.

Luxury handbags

That ₱250,000 Louis Vuitton or Chanel bag isn’t automatically an investment.

Luxury resale platform Rebag’s 2025 report found that Hermès retained an average 138% of retail value, while The Row averaged 97%.

But these figures reflect selected resale markets, not guaranteed profits. Ordinary designer bags may sell below their original prices, especially after years of use.

Brand-new luxury cars

Imagine buying a ₱5-million BMW or Mercedes-Benz.

According to Motorist Philippines’ 2026 depreciation guide, cars typically lose around 20% of their value during the first year.

At that rate, your ₱5-million vehicle could lose approximately ₱1 million in value in just 12 months.

Insurance, maintenance, registration, and repairs add to the expense.

Timeshares and vacation clubs

Some resort memberships in Boracay, Palawan, or overseas destinations require substantial upfront payments.

Consider a hypothetical ₱300,000 membership with ₱15,000 in annual fees.

Over 10 years, that’s ₱450,000 before travel expenses and other charges.

Unlike conventional property ownership, many vacation memberships are difficult to resell and may impose restrictions on bookings or cancellation.

Expensive jewelry

A ₱200,000 diamond necklace from a luxury boutique doesn’t necessarily have a ₱200,000 resale value.

Retail prices include craftsmanship, branding, and store margins.

When selling to a pawnshop or gold buyer, the offer may depend largely on gold purity, weight, gemstone quality, and prevailing market prices.

Even if gold prices rise, you may not recover the original retail markup.

Whole life insurance

A Filipino paying ₱5,000 monthly for whole life insurance spends ₱60,000 annually, or ₱1.2 million over 20 years.

But that doesn’t mean the policy’s cash value will equal ₱1.2 million.

Premiums also fund insurance protection and policy expenses. Early surrender may result in substantial losses.

Whole life insurance can be useful for permanent coverage, but buyers should compare its guaranteed benefits and projected returns against term insurance and separate investments.

Looking rich isn’t building wealth

Expensive purchases aren’t necessarily bad. They can provide enjoyment, convenience, protection, or prestige.

But genuine investing requires examining potential returns, risks, fees, and resale value.

A luxury purchase may improve your lifestyle without improving your finances.

Because owning expensive things and building actual wealth are two different things.

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