Penny Wise, Pound Wise: How to Know When to Splurge and When to Scrimp

Penny wise and pound foolish is an old English way of saying that you can waste a lot of money when you scrimp when you should have splurged. We can all think of times when being cheap can cost you big. But there are also times when going the cheaper route is the wiser move, even if you can afford to spend more.

Some things are really obvious. You spring for the best medical care you can afford. No one happily accepts discount heart surgery. Crazy Eddy’s bargain basement liver transplants would be a really bad idea. Sticking with the medical theme, there is no reason to pay for branded Advil when a giant bottle of Ibuprofen will do just fine.

But there are a lot of things that fall into the grey area. How much should you pay for a smartphone, tablet, or computer? Will the cheap one serve you just as well as the expensive one? What about the generic cereal with the funny name and anthropomorphic animal on the box? Is it really as good as the expensive stuff? Here are a few rules that will help you decide between splurging and scrimping:

When Your Family’s Health and Safety Depend on It

It is wrong to take shortcuts through your family’s health and safety to save a few bucks. When in Vegas, it may be okay to gamble on the dice. But it is never okay to gamble on something as important as home pest control. Las Vegas pest control is not a game of chance, but a crucial health and safety matter. Bites can be fatal to those with spider and bee allergies. The terror caused by fear of rodents is no laughing matter either.

To do the job right, you need to know the difference between the various kinds of pests that are likely to be in or near your home. You will have to know what chemicals to use to get rid of them without harming your family and pets. You will also need to know where to find those chemicals and how to use them. In short, you need a professional. When it comes to such services, saving your family is always more important than saving a few pennies.

When There Is No Negative Effect

It’s time to go cheap is when there is no negative effect. Saving money on your kids’ sporting activities is a good example. Of course, you want them to have the best helmets and pads. But the $75 cleats will work just as well as the $150 pair. This is especially true since your kids will grow out of them before the season is over.

Second-hand bats and other gear are indistinguishable from new after just one usage. And carpooling with other kids on the way to the same game can really help save on the gas.

When Your Job Depends on It

Carpenters pay more for hammers than weekend warriors. That is because their job depends on it. How much you spend on your next computer should depend on how much that computer contributes to your livelihood. For many people, downtime costs money. If you need a tool to be reliable under pressure, you need to spend as if your job depends on it, because it very likely does.

When No One Can Tell the Difference

If the logo on the back of your jeans is covered up by your coat or shirttail, no one is going to know if you paid $20 or $100 for those pants. Do yourself a favor and go with the cheaper pair. You can even bleach them and rip holes in them yourself. There is no benefit in paying someone else to do that for you.

If your friends can’t tell the difference between the expensive blood diamond and the synthetic, there is nothing wrong with saving the money, and possibly a few lives. If the cilantro chicken at Applebees tastes just as good to you as the dish at that 4-star restaurant, eat good in the neighborhood for less.

Spend more when your family’s health and safety depends on it, and when your income can be affected by it. Spend less when there is no downside, and when no one can tell the difference.