We are all guilty of this, going with a bargain in exchange for quality. Remember the old axiom, you get what you pay for. There are actually times in which spending less or buying cheap will cost you more in the long run. Saving money can actually cost you in the following scenarios over time.
- Smaller portions of certain things
- Cheaper alternatives to certain things
- Skipping simple maintenance
- Or financing certain things
When we think of saving money, we don’t think it will cost us did you ever go to a big box store and buy a huge box of toilet paper? Or do you feel that it is a waste of money. While it does not make sense to buy large amounts of fruit, or vegetables because more times than not they will go to waste; I made the mistake of picking a bushel of apples last fall thinking that they are so delicious that I will eat them so fast that they cannot possibly go to waste, I was wrong, I ate so many in the first day that I did not even want to look at an apple and sure enough, they rotted and I had to throw them out. However, sometimes it makes sense to buy more of an item, even though you are shelling out a little more money up front. If you have a large family, then you can relate, one such item is toilet paper, you seem to never have enough!
Did you ever say, hey, I will get that suit at the discount clothes store, why spend all that money for a good quality suit when I don’t wear them very often. Well saving money here will cost you over time. A good quality suit can last years, decades even, and if it is a classic design, never go out of style. Don’t fall into the trap of getting a cheaper suit for the short term, and have it fall apart, or worse yet, fall out of style. It will cost you more down the line to buy yet again another suit.
SKIPPING SIMPLE MAINTENANCE
Routine maintenance is a real tempting area to skimp on money, or not spend altogether. Bad idea, this is where saving money will actually cost you for example; how about maintaining your furnace or air condition unit, a simple $99 visit can prevent a serious high cost replacement. The average cost of a new air and heating unit replacement according to homeadvisor.com is between $2,300 to $4,900. Same goes for cars, or other big ticket items. Next to your house, your car is your next highest investment, and unfortunately the first two things we skimp on maintaining, or skip on maintaining altogether. What you think is saving you money now is most certainly going to backfire and cost you much, much more later.
Sometimes financing is the only way to buy, unless you are one of the lucky ones who can pay cash for a house or a car, it makes complete sense to finance a car or house. And if you get a good interest rate, then the overall total cost will still remain quite low.
Student loans, what you borrow today will have to be paid back in monthly installments in the future. In some instances this is well worth it, but keep in mind the amounts you are borrowing and if you can borrow as little as possible to avoid a huge payment in the future.
One of the worst purchase to make on a finance plan are appliances or computers, the value of these products drop rapidly plus the odds that they will break or become obsolete before they are paid off is very high. Think of the computer you had last year, or the year before, or ten years ago. They sure do not last all that long, and new faster better ones come out everyday. You don’t want to be paying for something that is long gone. It is better to pay outright for these products and avoid financing. The party who truely benefits is the seller, and never the buyer.
We trick our minds into believing that if we save money we are doing good. Human nature tells us to find the conceivably best alternative to our situation, but when we trick ourselves into this thought process, we are actually be costing ourselves a lot more money in the long run, and destroying our money, savings and long term financial stability. If you follow the simple principals above you will find that you are richer and happier and that it is worth the outlay of money now, than a tremendous amount later. Always ask yourself “why am I considering the cheaper alternative” and you will remember to pay a little more now than a whole lot more later.
This is an interesting video: