On the contrary. It's immensely practical. You're assuming your time is worth less than an extra GB of RAM. Assuming that ignoring all the optimisations saves you 4 hours of time in development, and about 50% (another 2 hours) in debugging, and 1GB of RAM is worth $120, you need to be paid $20/hour or less in order to justify wasting time on such an optimisation.
In actuality, most programs will take much longer than that to write optimised - even from the ground up - especially in areas where you're unsure of the optimisation required. And RAM, CPU speed, and disk speed are all getting cheaper, not more expensive.
As I've said before, it's not performance that matters, but responsiveness. If you get it responsive without wasting time on unneeded optimisations, why spend time/money on it to get it "faster"? You're right that time is money - you gotta take into account the programmer's time/money, too. I don't know about you, but I haven't made under $20/hour since I left university. It's cheaper to buy the stick of RAM and move on to the next business problem to be solved.
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