Should I go into debt for a Rolex?
What Expensive Watches Signal About Status
There I was, the only guy at the party without at least a years worth of mortgage payments on their wrist. As they spoke about their collections, and coveted next purchases, I couldn’t help but wonder, how they could possibly afford this?
We were around the same age, making similar incomes yet out of the group, I was the only one who didn’t believe spending tens of thousands of dollars on an accessory that told time was a good investment. Seeing as I was the odd man out, I stopped to wonder if perhaps I was missing something?
Only a few days earlier, a tweet started circulating around the internet of a wise man named Steven suggesting to young men in their 20’s to buy a Rolex, even if it meant going into debt. Seeing as Steven’s X profile is verified and he works as a Principal at a Family Office, he must know what he’s talking about.
Although I was jetlagged from a transatlantic flight and carrying more credit card than usual because of the holiday season, I made my way to the nearest store that sold Rolexes. Suddenly I was affronted with an uncomfortable feeling that liquidating investments or going into debt to buy a Rolex was not the best decision.
Evidently Steven and many others believe these watches give them a type of status superpower. But does it?
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A very short history of luxury watches
Watches as we know them began evolving in Switzerland and Germany during the 16th century, starting with mechanical clocks that were carried rather than worn. The first wrist worn timepieces were bulky, and primarily only reflected wealth and status rather than actually being useful for telling the time.
By the 17th century, watches became more portable and sophisticated due to innovations like the balance spring, which improved accuracy, making watches more functional. The modern luxury watch industry really began in the 19th century, spearheaded by Swiss manufacturers with renowned brands like Patek Philippe (founded in 1839) and Audemars Piguet (1875).
Luxury watches gained popularity due to their association with royalty and aristocracy. Queen Victoria owned a Patek Philippe pocket watch, cementing the brand’s elite status. During this period, brands like Rolex (1905) revolutionized watches by focusing on mass appeal. Rolex's waterproof Oyster case and automatic movement made them useful tools for professionals and adventurers.
In the mid-20th century, watches shifted from practical tools to luxury accessories symbolizing status and style. The quartz revolution of the 1970s, led by Japanese brands like Seiko, threatened the traditional Swiss industry with inexpensive, highly accurate quartz watches.
Today, the luxury watch market is a multibillion-dollar industry, valued at ~$45 billion USD with Switzerland still producing over 50% of the world's luxury watches (by value). Watches from brands such as Rolex, Audemars Piguet and Patek Philippe can cost in the hundreds of thousands, if not millions of dollars.
Why buy a luxury watch in 2025?
These days a watch from one of these brands no longer serves any functional value; we have the time on our phones and until Apple acquires one of these companies, they don’t display messages or biometrics.
The reason you own a luxury watch is because you:
Like the aesthetic
Appreciate the history or craftmanship of the piece
Are looking to buy & sell as an investment
Are trying to signal status to somebody
Aesthetic, History & Craftsmanship
We all like to believe that we have original taste but we don’t. I’m sure reading Rick Rubin’s Creative Act inspired you and whatever (we know most of you didn’t get past page 50) but if we are being honest, very few people have unique taste of their own. People will lazily buy whatever they see their idols wear or what the luxury brands tell them is the new hot thing.
You aren’t paying $500 for a Moncler polo because it looks or feels that much nicer than others, you do it because of the brand equity. There’s safety in purchasing something from Moncler or Loro Piana because their designers have “validated good taste”. Buying from a luxury brand is the equivalent of “Nobody ever got fired for buying IBM”. This is why they can charge such a large premium. Watches are no different.
I doubt your average buyer of luxury watches knows or cares much about the history of craftmanship of the piece. Perhaps some will pretend to recall a few things the salesperson told them that helped them rationalize their purchase. You might not like this but most history buffs I know are wearing Casio watches.
As an Investment
On the other wrist1, re-selling is a legitimate reason to buy a luxury watch. The secondary (pre-owned) luxury watch market does about 50% of the primary market, with some collections or pieces selling well above their original primary price. As an asset class, watches have less correlation to the stock market, therefore in theory you would get to benefit from diversification. The most comparable assets to a luxury watch would be high end purses, art or wine.
There are some fairly obvious downsides to investing in watches. For one thing, they are illiquid investments, meaning it can be difficult and time consuming for you to sell it for its intrinsic value or fair market value. It could sometimes take months or years to find an appropriate buyer for watches, rare wines or paintings.
Beyond the illiquidity, you don’t generate cashflow while you own a watch. If you took that same money and put it into a stock, bond or real estate, you could receive dividends, interest or rental payments. You can even buy passive vehicles for these other types of assets such as ETFs, REITs or Bond funds, that do the work for you. For now, you can’t passively earn money through watch index funds.
So while it’s possible to make money buying and selling watches, it can be quite time consuming, carries many risks and few people would consistently outperform a broad stock market index.
Status Signal
The real reason people spend $45 billon dollars per year on well crafted pieces of metal is to signal they have money, taste and they are somebody. For somebody coveting status, the worst thing they can be considered is an NPC2. For those unfamiliar with video games, when an NPC dies, they drop common loot. You usually get rare items only for beating bosses or completing difficult missions.
If somebody is carrying a rare item, by definition they can’t be an NPC; they must be a main character or boss. This is the logic that powers people who try to buy status. Instead of becoming a high status person through accomplishments or levelling up their character, they are trying to buy and equip an item that boosts their status.
Even if the average person does not know anything about watches, they know Rolexes are expensive. Rolex works hard to ensure that their brand is highly associated with wealth and class. It’s not a coincidence they sponsor Golf, Tennis, Equestrianism, Yachting and Formula One but not Football or Basketball. This is why wearing a Rolex is great to impress people at a similar or lower social classes than you are.
If you are trying to impress somebody that you perceive as higher status, wearing expensive clothes or accessories can signal you belong. You need to wear the appropriate uniform, or else they will assume you are an imposter. In the film Tenet, The Protagonist goes to meet with Sir Michael (Michael Caine), a high status individual. At the end of their conversation, Michael tells The Protagonist that if he wants to pose as somebody in that world, Brooks Brothers wasn’t going to cut it.
(You can skip to 2:20)
Sir Michael isn’t high status because of the clothes he wears, but he can immediately spot somebody that doesn’t know how to dress. If somebody doesn’t know the uniform, they can’t be in the same status. Passing the uniform test is not enough to convince somebody you have status, but if you can’t even get past this initial hurdle, you won’t even have the opportunity with people who care about this sort of thing.
Unfortunately, people seem overly focused on clearing this first hurdle without thinking what comes next. Wearing the right uniform gives you a chance to avoid immediate detection, but a uniform on its own won’t take you far. If you have not earned status through accomplishments, a real person of status can tell. This is because status is not determined by wealth or possessions. Your status is determined by the way you carry yourself, your confidence, your general demeanor and vibe.
Having money does not automatically translate into status, but it helps. If your wealth comes from a history of past achievements, you will likely feel confident, which will help with your aura. If somebody gave you money without you doing anything to earn it, you probably won’t give off the same energy as another equally wealthy person who did a lot of cool things. This isn’t always the case though, highly accomplished people can sometimes feel insecure, while others with fewer achievements can exude confidence. This is part of why status is strange. Other people determine if you have it, but it’s internally generated.
Clothes, watches, haircuts, or plastic surgery can help you feel confident in the moment, but they won’t sustain that confidence on their own. People that are actually high status would still be confident and secure without any of these things. If you are not confident and secure, buying a luxury watch won’t give you these things. Only high status people understand this.
This is exemplified in the debut episode of Succession. Tom Wamsgans gifts Logan Roy a Patek Phillipe watch for his birthday. For Tom, who is nouveau rich and status obsessed, he considers the watch to be a very good gift. Meanwhile Logan Roy, the wealthiest and highest status individual in Succession, barely acknowledges it. Adding an expensive watch does not give him anything he doesn’t already have. For somebody like Tom, he believes it holds power. Despite having newfound wealth, Tom is uncomfortable around Logan and most high status people around Waystar Royco. Logan is not impressed by people with money. Logan is only impressed by people with strength. This is why, buying an expensive watch to impress somebody like Logan Roy, would never work. To impress Logan, you would probably need to buy the Patek Phillipe brand to shut it down, just to piss off a business rival.
Although Logan is a fictional character, all the same, buying a luxury watch to impress a high status individual probably wouldn’t work. It’s a person’s character that determines their status, and putting an expensive band on their wrist won’t change that.
Conclusion
Should you go into debt to buy a Rolex? The answer ultimately depends on your motivations and priorities. If you’re chasing status, hoping a luxury watch will elevate your standing, remember this: true status is earned, not bought. It emanates from accomplishments, confidence, and the way you carry yourself, not from the logo on your wrist. A Rolex might turn heads at first glance, but lasting respect comes from character and substance, not accessories.
If you are buying it for its investment potential, there is the possibility of getting a good return, however, when you factor in the risks and time commitment required, you’re better off with more traditional investments.
If you love watches for their craftsmanship, history, or aesthetic, then by all means, go for it but don’t go into debt. As appealing as the status symbol may be, it’s worth considering whether the real power lies not in the watch you wear, but in the self-assuredness of knowing you don’t need it to prove your worth.
Sometimes, the strongest flex is not needing to care about somebody else’s definition of success.
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If you would like to prove me wrong, and insist on buying me a Patek Phillippe watch, I will be willing to wear it around to see if my status increases. If instead, you want to send me the equivalent cost of a PP watch, that’s fine as well. Otherwise feel free to send me a smaller amount of money so I can buy my morning coffee.
I am so sorry.
A non-playable character (NPC) is a term that originates from video games. It is an insulting way of calling somebody that is conformist, passive, or not noteworthy
Per usual, Morgan Housel nails it: “There is a paradox here: people tend to want wealth to signal to others that they should be liked or admired. But in reality those other people often bypass admiring you, not because they don't think wealth is admirable, but because they use your wealth as a benchmark for their own desire to be liked and admired.
The letter I wrote to my son after he was born said, ‘You might think you want an expensive car, a fancy watch, and a huge house. But I'm telling you, you don't. What you want is respect and admiration from other people, and you think having expensive stuff will bring it. It almost never does--especially from the people you want to respect and admire you.’
It's a subtle recognition that people generally aspire to be respected and admired by others, and using money to buy fancy things may bring less of it than you imagine. If respect and admiration are your goals, be careful how you seek it. Humility, kindness, and empathy will bring you more respect than horsepower ever will.”
A rolex is a gorgeous watch, and if you do it right, they don’t cost a fortune. Grab a vintage one.