I could make a mathematical model of this, but I am not going too, because the theory should be good enough for those capable of understanding.
Premise: Buying the absolute cheapest is always the budget decision.
There are a few main ideas why we would want to pay more.
1. Pay more, and I get discount.
2. Pay more, and I get better quality, products that last longer.
3. There is something dangerous, bad, or incorrect about cheap products.
Yes, each of the three point above can be true.
However, the math worldwide turns out, more like 5 percent of the time, 1 in 20 times, the concepts above pay out.
However, if you live as minimalist, never buy anything expense, and try not to buy you will have better value and quality 95 percent of the time.
What is a good deal?
A good deal is when you feel content, happy, and feel you got a good value. This strategy above will allow a person with critical reasoning skills to be happy.
However, being that only maybe 1 in 50 people are of this nature, then a good deal is normally paying more, because the other 48 people near them are also paying more
Marketing people who truly understand the point above, people like Steve Jobs knew that people needed to pay more to be happy.
What it means to me is this, I can relax on all the math when trying to buy, and just buy the cheapest. Even when I buy poor quality, I have saved so much money with other purchases, it is inconsequential.
davidavid08 from has written 20 comments
I certainly agree with SOME of your ideas about value. "Value" is a relative term and will mean different things to different people. Factored into value may be longevity, functionality, comfort, style, status, and even a "cool" factor. Also, what one can afford to pay.
I know a guy who says he only stays in 3 star hotels because he thinks 5 star hotels are a rip. In your case you only stay in minus 3 star hotels because you think minus 2 star hotels are a rip. Both of you think you are getting the best value.
Because of your lifestyle, I suspect that you buy very few "things", so always buying the cheapest works for you. For those of us living more complicated life styles, more research is required to get good value. Here is what I think I know.
Cheap tools are a waste. Very poor value when the tool breaks the first time you use it. I pay more money for good tires and good shoes. The cost per mile is less than for cheap tires and shoes. I pay more money for my MacBook Pro than I did when I use PC's. For two reasons: I need something that works and I never learned how to trouble shoot the numerous problems that PC's seem to have. It has never been my ambition to be a computer expert. I only use them. Buying the cheapest car is NOT a good idea. Neither is buying the most expensive. A Honda or a Toyota is probably your best deal, but that is not a given either. Fake jewelry is better than real jewelry. It serves the same purpose (for me). Actually, no jewelry is best. Fresh food is better than processed food. Cost should not be a factor. I do cringe every time you write about eating a can of peas or beans. I buy good quality clothes at garage sales and thrift shops. The cost is the same as for poor quality clothes. The same is true for tools if you can find them.
I do pride myself in my frugality. But I don't think that always buying the cheapest is the best value.