It can be hard to figure out when you should save money and when you should splurge.
Here’s how I do it:
IS IT IMPORTANT TO BUY THE BEST ITEM OUT THERE?
Things like car seats, baby strollers and other safety or health-related things fall into this category. Food included, because we buy organic food when we can, and the best quality we can find for the price.
You do not want to compromise on safety or health, but in the same vein, you do not want to spend $1000 for an UppaBaby stroller when something in the $200 – $300 range will do just fine.
Another example is that if it costs $1000 for an medical injection that you need to save your life, you are darn well going to pay for it, aren’t you!?
In this case, it’s a balance between spending a lot of money (a price tag does not always equal high quality), versus compromising on things like aesthetics or ease of use.
WILL I KEEP AND NEED IT FOR THE LONG-TERM?
If I don’t plan on keeping it for the long-term (e.g. a super trendy item or something for the baby that they only need for 3 months if that), then I don’t spend a lot of money on it.
What falls into this category for me are things like coats. I have a thing for coats, blazers and jackets, because Canada tends to be on the cool rather than hot side.
Jackets and coats are what people see 99% of the time in your wardrobe, so why not buy a beautiful, warm, comfortable one that everyone will see all the time?
IS IT GOING TO BE SOMETHING THAT WILL BE USED ON A DAILY BASIS?
What falls into here for me are shoes. If shoes are not comfortable, well-made and wonderful, you will wear them for 8-10 hours a day, and CURSE YOUR CHEAPNESS.
If you come home with blisters, bunions, crooked toes, calluses, and a whole host of back and foot problems, you will wish you spent the money on a properly made boot, shoe, heel, or whatever you want to put on your feet.
It is not worth it for me to hobble around.
WHAT IS MY USAGE OF THE ITEM COMPARED TO THE PRICE?
Something I don’t plan on using a lot, I won’t be spending a lot of money on.
For instance, books. I read it once, I don’t really re-read it again unless it’s for sentimental reasons, so I tend to avoid buying books, and go online to download ebooks from the Toronto Public Library instead.
Something like a laptop however, I am willing to spend a fortune to get the best one out there (I have run the gamut of laptops and they’ve all annoyed me because I was too cheap and didn’t want to spend the right amount of money to get the right laptop).
So I shelled out $3000 for a great Macbook Pro 17″ (when they still made 17″ laptops), and I have never been more pleased with my purchase in my life.
I use it 6-8 hours a day, and it doesn’t give me nearly as many problems as my other Windows PCs used to. I still get a few errors and problems here and there, but it’s 1% versus 75% of the time.