I’m sure you know people who buy the best of everything. They can’t get the $2 juice. They have to get the $10 juice because it’s “better.”
The thing is, sometimes it’s actually better to cheap out.
We had to paint our house this year. We called six or seven painters to get estimates, but only two called us back. The economy is hot here in Myrtle Beach, and people can’t take the work.
The first estimate was $11,000. The second was $25,000. Now, you might think this was an easy decision. But the guys that charged more had a great reputation, and the other guys did not. They were schmucks.
Still, we decided not to pay an extra $14,000 for paint. We went with the cheap guys, paid $11,000, and they were terrible. They dragged it out for six weeks and never showed up on time. Ultimately, they painted the house, and it looks fine. But they were annoying.
Even so, is it worth $14,000 to hire painters who aren’t annoying? I don’t think so.
Now we have a problem with our water heater. It broke recently, and we have to buy a new one. The cheap option is $2,200. The expensive option is $3,800. But we’re not building a temple to hot water, folks. It’s just hot water. So we’re going with the cheaper option.
I may regret these decisions at some point. Maybe the paint will chip off or the new water heater will go caput. Maybe we should have spent more money on this stuff, but I doubt it. It’s literally just paint and hot water.
Right after college, I would buy all generic stuff at the grocery store. I’d go to Safeway and buy Safeway brand everything. The Safeway coffee was awesome. So why spend an extra four or five bucks on something else?
I buy more name-brand stuff today, but a lot of it’s still generic. If you’re buying a bag of sugar, what’s the difference? It’s a commodity—one bag of sugar is the same as the next.
I was in the store about a month ago, and Clorox bleach cost about $4 more than the store brand. Both bottles were filled with the exact same chemical. So why spend $4 more? I don’t know, but people do it. And they’re wasting a lot of money.
As I’ve said, I cheap out on food. I like steak, though. So once every few weeks, I go to Whole Foods and buy a prime ribeye. That’s my splurge. And I might eat at a super expensive restaurant once every six months or so. Everyone needs to treat themselves occasionally.
Otherwise, there are two things you should spend as much as you want on: a mattress and air conditioning. The quality of those things makes a real impact on your life.
Also, if you have a hobby, go ahead and spend a lot on that, too.
Spend where there’s a real difference in quality and that difference actually matters to you. Otherwise, it’s better to cheap out.