When It Makes Sense to Splurge on Quality Instead of Saving Money

Today’s post dives deep into the different between saving through frugality and knowing when to spend on quality. It is also a guest post from Stefan. Follow his blog at TheMillennialBudget.com and check him out on Twitter.

As for his background, Stefan is a young millennial who is finishing up his MBA. He will be sharing his journey as he embarks from college into the real world as he pursues financial independence.

Frugal is a word that we often interpret as saving money. While this is partially correct, frugal actually means spending your money wisely. So what’s the difference? Buying cheap items may save you money in the short-term but it may actually cost you more in the long run. Let’s take a look at the difference between being cheap and frugal.

Warren Buffet once said, “Price is what you pay… Value is what you get.” Here is a perfect example of what he means by this.

A fellow teammate of mine had to buy a car for his senior year in college to commute to his clinical placements. This was supposed to just get him through senior year and then he would sell the car for a better one once he began working. Prior to his car search process he set a budget that would allow him to purchase a decent used car. He told me that he will pick me up from the airport to show me the new car as a surprise.

Upon arriving back into the US he picked me up from the airport with his new car. When I saw the car I was pleased with his purchase from the outside. It looked like a sturdy car that was well taken care of. However, what got me slightly concerned was how old the car was, the fact the engine light was on as soon as I got in and the price he paid for it.

The car cost 25% less than his budget, so I thought wow what a great deal you got! There was just one downside though; the car was a 2004 model, so roughly 11 years old at the time. I am no car expert but that, in my opinion, had problems written all over it.

To cut the story short here is what transpired from this purchase. The car worked great, for roughly 3 months. After that there were numerous problems and many break downs which cost approximately 60% of the car’s purchase price to fix. Currently the car is sitting in our school’s parking lot accruing dust because understandably, he does not want to put out any more money to fix the car. If anybody wants to purchase this lovely automobile please feel free to contact me…just kidding I would not do this to my worst enemy.

To sum up this purchase here is a quote from our good friend Benjamin Franklin, “The bitterness of poor quality remains long after the sweetness of low price is forgotten.”

To be fair to my friend he thought he got a great deal and so did I. The purchase was meant to be temporary so price was definitely high up on the selection criteria. What Benjamin Franklin says however is that we are often blinded by the price that we forget all of the other factors we need to account for. He saw what he perceived was a great deal from a price perspective so he purchased the item with perhaps little consideration for the future. Unfortunately for my friend, buying cheap led to spending more money after the purchase for maintenance, repairs and upkeep. If you really want to save money then you should invest in quality. There are times when it makes more sense to spend more money now so you do not run into these problems down the road.

Here are some items where it makes sense to splurge on quality instead of saving money:

Vehicles and Other Modes of Transportation

When you purchase a big ticket item quality will usually trump price. Price is only one factor but what about the total cost of ownership? Think about maintenance, repairs, fuel, insurance and other cost factors that play into the budget. Do not however believe high-end or luxury will ensure a better purchase. Think about fuel economy and the safety of the car rather than the brand.


Purchasing a house should never be done on the cheap side. Before you know it you will be ripping down walls to fix unexpected costs. Like vehicles, think about the total cost of ownership. What is the upkeep cost, the square footage, location, and neighborhood like? Do you plan on growing your family? Think about the future and not the present.

Appliances and Energy-Efficient Products

Ever see those energy efficient tags on appliances? Usually the more expensive the appliance the more energy efficient it is which means more savings down the road for you. These purchases may involve some math to figure out the future benefit along with some assumptions. Costs to factor into your budget should include how long will you own these appliances and what is the cost of using them? If you plan on using the item for a long period of time it will likely make more sense to purchase the more expensive item if it saves you money later on. Some items that come to mind are solar panels, energy efficient light bulbs, rechargeable batteries, and kitchen appliances.


Like many of the other categories a major factor to consider is the length of time you plan on owning the furniture. Purchasing cheap furniture will likely fall apart and cost you more money to repair should you have bought better quality. Another factor you need to consider with furniture is how often do you plan on moving? Some people frequently move so it may make more sense to purchase lower quality furniture as they are always on the move. However, if you take the furniture with you it may be cheaper in the long run if you purchase a sturdier, long-lasting piece.

While this may not be a comprehensive list it is one that entails common items we all purchase. Every list will be different depending on one’s lifestyle. For example I will not compromise the quality of my computer for price. My computer is far above the average price but it is something I use every day and an item I deem worth the cost as I do not intend on replacing it for many years. Finding the sweet spot between cost and quality (or longevity) may save you hundreds or even thousands in the future that can be invested into your goals and savings.

What items does quality triumph over price for you? Have you ever found an instance where price outplayed quality for big ticket items?

23 comments… add one
  • The Green Swan May 18, 2016, 6:30 am

    Great post Stefan. It can be really hard sometimes deciding whether it is worth spending a bit more for quality. My wife and I try to make the best judgement we can at the time, but even still we sometimes change our mind later (for example wishing we had gone with quality).

    • Stefan @Mllnnlbudget May 19, 2016, 11:54 am

      Thanks GS, judgement can be hard at times because we factor in price most of the time. It is psychologically harder to purchase a more expensive item!

  • Distilled Dollar May 18, 2016, 6:39 am

    Great post! I loved the quotes!

    When it comes to frugality, it can be easy to dip into austerity before we realize we’re better off spending some money.

    The furniture example is great. When my girlfriend moved, we picked up a free piece of furniture from Craigslist. The woman had authentic cleaning bills and it looked great at first. By the time she moved in with me a year later, the couch had basically fallen apart, between the wooden beams having bent/broken and the fabric being torn.

    Fast forward to our latest move in and we ended up splurging on a new couch. We kept our eye out for a sale and jumped at it. We might have saved a few bucks if we spent more time shopping on craigslist for a slightly used couch, but we ended up being happy and not spending that much time at all.

    • Stefan @Mllnnlbudget May 19, 2016, 11:55 am

      I knew you would love those quotes haha. They really did drive home the point though. Buying a good couch is something I have always wanted to do as I expect I will be moving a lot and hey need somewhere good to watch some EPL!

  • Money Under the Cushions May 18, 2016, 7:31 am

    With furniture it depends I think. If you are a DYIer you can pick up some great, sturdy, last the rest of your life furniture (i.e. coffee tables, dining room tables, dining room chairs) at low prices and fix spruce them up if they are out of date or refinish if there are some cosmetic dings.

    • Stefan @Mllnnlbudget May 19, 2016, 11:56 am

      Couldn’t agree more and that is why this list will vary from person to person. Anybody who can construct items will always be better off. My dad for example built most of the furniture in our house and I know it is better quality that will last longer.

  • FinanceSuperhero May 18, 2016, 8:15 am

    Your story is an excellent illustration of the importance of making quality purchases, Stefan. Your friend took a big gamble, and while he may have looked brilliant had it paid off, it is sad to see he got burned in this case.

    Mrs. Superhero and I followed your advice when purchasing our first home. After looking at countless fixer-uppers, foreclosures, and short sales, we stretched our budget a bit higher (but nowhere near our pre-approval amount) to buy a home that was only 5 years old at the time. In this case, the biggest added value for us was that we will be able to grow into this home when we have kids; in fact, unless we end up having 4+ children, we will never have to move due to lack of space. Purchasing with the future in mind can be tough, to be sure, but it is a calculated decision that often pays off.

    • Stefan @Mllnnlbudget May 19, 2016, 11:58 am

      Yeah he got burnt pretty bad on this one I suspect he is going to lose quite a lot on this purchase. I think you made the right decision with the home and it is a debate I have with my gf all the time. Personally I like newer homes as they have less problems and you can grow into them, depending on your situation of course.

  • Apathy Ends May 18, 2016, 9:06 am

    I used to do this all the time trying to save money, cheap electronics, tools and kitchen items that just don’t last – nice post and great reminder to look for value not cost.

  • Amanda @ centsiblyrich May 18, 2016, 10:01 am

    Great post! I think we’ve all probably learned some hard lessons just focusing on the price tag things. Shoes are something that I don’t skimp on. If they fall apart in a month or two, when a slightly more expensive pair will last a year or more, it’s seems a waste of money.

    • Stefan @Mllnnlbudget May 19, 2016, 12:00 pm

      Thanks Amanda. I wish you can talk to my girlfriend about that haha she is very price conscious!

  • Preston @TheDrunkMillionaire May 18, 2016, 11:30 am

    Great post Stefan! I’m always evaluating cost vs. quality vs. long-term durability. Last year I bought a cheap lawnmower from Craigslist that worked well the first time I mowed the lawn and had troubles the next three times until it died. This year, I bought a decent quality, slightly used model that has worked great and should last. I guess lawnmowers are similar to vehicles. 😉

    • [email protected] May 19, 2016, 7:28 am

      Funny you mention lawnmowers! I bought a really cheap mower ($99) and it ran (and did a great job on the lawn no less!) for over 10 years – with almost no maintenance. I had planned on letting a tenant use it at one of our rentals, but I decided to keep it because it was light to push and easy to start. I know that is definitely a rare “score” – but once and awhile, low price wins!

      • Stefan @Mllnnlbudget May 19, 2016, 12:02 pm

        Never thought I would get lawnmower stories out of this but seems you got lucky Vicki and Preston got the deal my friend got haha. Nothing is wrong with cheaper items but they will more likely than not be more costly!

  • Mike May 18, 2016, 1:38 pm

    Quality does trump cost for certain things…my Ikea chair lasted 2 years but the chair that I had prior to it is still good after 12 years…
    you could also cookware to this list too…my Le Creuset & Calphalon cookware is significantly better than what I had before…

    • Stefan @Mllnnlbudget May 19, 2016, 12:02 pm

      I have found myself replacing my cheaper cookware quite often! Something I need to look into when I move into my new place.

  • Ms Susty Themes May 18, 2016, 4:35 pm

    Sometimes it’s wise to “buy the best and only cry once” 🙂

  • Matt Spillar May 18, 2016, 6:01 pm

    Great post, I really like that Benjamin Franklin quote, it’s so true! It feels great to get a good price on something, but the overall value is what really matters. One of the main factors to consider is how often will the item be used? If it’s something you’re going to use everyday, such as your computer or a car to commute to work, it makes much more sense to spend more on quality.


    • Stefan @Mllnnlbudget May 19, 2016, 12:05 pm

      Time is a major factor which is why i made sure to emphasize it. If you are only buying it for a couple months then heck you better be purchasing on the cheap side! I will never go cheap on a car after his experience as it definitely was not a value purchase.

  • Matthew May 18, 2016, 6:24 pm

    More and more I’ve found myself taking the ERE approach towards buying things – if it seems like something that will hold most of it’s value if I decided to sell it back, I’m willing to spend more up front. Nearly everything else can be found used, with deprecation having already made it’s mark.

    The used car vs. new car debate tends to (I think wrongly) drift to the “new” side. A $5000 used car that requires $5000 of maintenance and repairs over say 3 or 5 years (typical warranty periods for new cars), compared to a brand new $10000 car, would seem like the wrong choice. Both seem to cost the same, but with the used car there’s the risk of breakdowns, time without a car ($5000 is a lot of work!), hassle, etc. And your time is valuable, you’d rather be at home with your family than sitting around waiting for your car to get done. The difference comes from the combination of the total cost of ownership of the new car (higher insurance if you’re buying with a loan, higher property taxes, deprecation, interest, opportunity cost of funds needed to buy new vs. used, etc.) and the misperception of the value of one’s time.

    Most people have an “hourly rate” in their mind and might make spending decisions based on how many hours of work it takes to afford something. By failing to take in to account things like commute time, grooming, cost of work related transportation, food, medicine, etc, they are overestimating what their time is worth – their “real rate” could be half of what they think they actually make. The extra say $2000 spent to get the newer car might be worth 100 hours of their time at $20 an hour. Cut that in half in you’re around 150-200 hours. If the used car buyer spends a few hours one Saturday a month learning some DIY maintenance, reducing the cost of some of those repairs, they come out even further ahead.

    The fluffy example above leads me to this: I believe that in order to buy something in the most efficient way you must first understand the value of your time and your money. Because time, money, and quality are all emotional concepts, it is important to understand how they relate to each other, rather than just how you personally relate to them. Then you will be well-equipped to stand behind your decisions.

    • Stefan @Mllnnlbudget May 19, 2016, 12:08 pm

      Matthew this is very valuable input. Valuing time is something that I believe people undervalue due to lack of effectiveness or even awareness that time is really money. Think you should write a post about how the three concepts are intertwined I would love to read it!

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