Should I Buy A Rolex?

I’m an old man at heart. The oldest 28 year old I know.

Being an old man, I like old things. Old things were made stronger and better than most of the items of today—cars clothing, shoes, furniture, homes and scotch to name a few.

The word “vintage” is consistently in my vocabulary. Being an old man I appreciate craftsmanship. Hand-sewn shoes impress me much more than the latest LeBron sneakers. With my appreciation of the old and the well made, I love vintage watches.

When I open up a digital watch I see a circuit board and a battery. When I open up a mechanical watch I see craftsmanship. I have an appreciation for all of those parts carefully being put together in a Swiss factory.

The word Rolex carries much baggage. Some are reminded of elegance, artistry and history. Others are reminded of snobbery, greed and waste.

Rolex-Explorer-Matterhorn

A Rolex is the most well known watch brand and the 68th most powerful brand in the world. To me it is a reminder of success, a well-made product, an investment piece.

However a watch is never a good investment. You never buy a watch—any watch—thinking you will be able to sell it for more in the future. This probably won’t happen especially when considering compound interest.

I started researching watches near college graduation and was always fascinated with them. How could so many parts be put together in such a tiny casing? Many of my friends settled for Nixon or G-Shock monstrosities. That wasn’t for me.

Little did I know that most watches are produced by the same corporations or conglomerates including Swatch (Omega, Longines, Hamilton), Richemont (IWC, Cartier, Jaeger Le-Coultre) and LVMH (TAG Heuer, Zenith).

Since these watch groups have a diverse portfolio they will probably be around for quite some time. They are sharing knowledge and technology. Lesser watch brands may use movements from a more powerful watch company in their group.

All of the above mentioned watches are “Swiss Made” meaning at least 50 percent of the value of the movement comes from Switzerland.

I would like my watch movement to be made entirely “in house,” meaning the components are made in the same Swiss factory. My watch won’t be “Swiss Made,” it will be SWISS MADE!

To be clear, I already have a nice watch; a vintage Omega Seamaster. I paid about $300 including the cleaning for it and enjoy it very much. However, instead of satisfying me, it was simply my starter watch. My gateway drug, if you may.

My Omega Seamaster

My Omega Seamaster

Some may scoff at paying more than $50 for a watch. But at such a low price point you will be forced into buying something with a quartz movement where you will have to replace the battery regularly. A $50 watch is essentially disposable. If it doesn’t end up in a $1 pile at a yard sale it will make it’s way to the landfill.

On the other hand, my $300 watch will end up on my son’s wrist unless I decide to sell it for $250 plus down the road. Hell, even Jacob at Early Retirement Extreme has a vintage Omega Seamaster and he lives on $7,000 a year!

With this being said, I really want a vintage Rolex. A Rolex Explorer 1016, to be exact.

This model was made between 1960 and 1988. In 1990 the Explorer’s numbers were enlarged and in 2010 the watch’s width increased from 36mm to 39mm. The size increase is important because I have svelte wrists and dislike large watches in general. Other than these two changes, the Explorer has basically stayed the same.

Explorer-1

The Explorer was the first watch atop Mount Everest. It’s the original James Bond watch. A quick image search will find it accompanying the wrist of Brad Pitt, Matt Damon and Tom Hanks. Don Draper wore it on season four of “Mad Men”.

It is simple in design and durable in performance. It can be worn with a tuxedo to the opera, while washing your car or while deep sea diving. For a frugal guy like me, it is also extremely expensive at close to $6,000 for a certified model. Even more with all of the boxes and paperwork included.

So how can I justify this purchase? The truth is… it’s hard! I don’t need an expensive watch. If I took $6,000 cash and invested it in stocks, bonds, REITS, gold or even bitcoin, I would probably make a much larger profit in the long run. However, if I spent $6,000 on a newer car or diamonds, my “investment” would surely depreciate.

Rolexes over time have appreciated with regularity (zoom in on the prices in the vintage ads). The watch I want today was only a few hundred dollars new. A new Explorer model is similar in price to a vintage model. Only the models of the 1990s can be had at a significant discount.

When you buy something, you should know the price you can sell it for that day and years down the road. I’m very confident that if I buy a $6,000 Rolex I can sell it for a similar price the same day. Just showing the receipt and authenticity paperwork from a reputable dealer like HQ Milton or Bob’s Watches would net me close to what I paid on Ebay. With the way inflation will surely take off I could optimistically hope for more in the future assuming I don’t severely scratch or smash the glass.

1962-Rolex-Stein Eriksen Skiing

A Rolex is also international currency.

Kidnapped in the Congo? Trade your Rolex for your life. Out of chips playing Texas Hold’em? Raise you Rolex. Prepping for the apocalypse? A Rolex for adequate food, water and shelter.

John Cusack’s character in the movie “2012” trades his IWC Big Pilot for an airplane ride out of Los Angeles. It’s a beautiful watch but without an in-house movement it is very much a poor man’s Rolex.

Buying a watch of Rolex’s caliber ensures you will be respected by the bigwigs in the boardroom and anyone with fashion sense throughout your life.

How about the negatives to owning one?

I work in Silicon Valley. Dressing well is looked down upon. A suit and tie will intimidate your client and worry your boss (job interview today?). While I no longer wear a suit to meet clients, I rarely care what the uninformed think.

But after writing this post and some careful thinking I’ve decided I will probably buy this watch. Just not today.

Today I’m saving up to buy my freedom. Once that’s paid for I will rethink picking up this timepiece. I better save for two. The wife will probably want one as well.

Rolex 1016 in the flesh (Courtesy of Tom Vox)

Rolex 1016 in the flesh (Courtesy of Tom Vox)

This article has 10 comments

  1. Steve Reply

    Never had a thing for watches but after reading this I can see the appeal. I could totally get into it, researching countless hours on the best watch investments and how to spot fraudulent ones. Haha… must stay away. I’ll probably just end up with an iWatch or whatever HA! Arrest me now fashion police 😀

    • Steve Reply

      You know it would be fun! You can get a very respectable vintage watch for a few hundred bucks. Someone tweeted a photo of an 35 year old Seiko digital watch that was $400 new. For that price you could have bought a Rolex that would have appreciated in value. I don’t think I can justify paying this much for a watch until I’m worth at least a few hundred grand!

      I enjoy to daydreaming though! 🙂

  2. Amir Reply

    only buy something because you love it. A $15 timex given to you by your grandfather would be endlessly more meaningful than a $6000 Rolex. In this day and age quality isn’t even an issue. If it’s cheap it’s disposable and inherently easily replaceable. They’re just things. We need to care less about things.
    Nice post, thanks for sharing.

  3. I Bought a Rolex - Steveonomics Reply

    […] didn’t think I would ever be able to afford. That was the Rolex Explorer 1016 that I wrote about here. This was by far my favorite Rolex model. The only other vintage models I really enjoy are the […]

Leave a Reply