When to invest in quality items and when to buy cheap
Saving Pennies or Dollars is a new semi-regular series on The Simple Dollar, inspired by a great discussion on The Simple Dollar鈥檚 Facebook page concerning frugal tactics that might not really save that much money. I鈥檓 going to take some of the scenarios described by the readers there and try to break down the numbers to see if the savings is really worth the time invested.
Marie writes in: My grandfather was not a wealthy man, but he always told me to buy the best quality I could afford, it will last longer. When I was in my early 20鈥瞫 I purchased a professional hair dryer for about $250.00. This was in the mid 90鈥瞫. So that鈥檚 about $20 a year so far. I feel like I am already ahead considering a $20 hairdryer never worked for a year. What products are worth spending money on鈥nd I find when possible buying industrial or professional grade products last longer.
Marie makes a great point, albeit one that鈥檚 hard to quantify exactly. I鈥檒l try to dig into it with a few examples, but suffice it to say, it鈥檚 really only worth paying significantly more for reliability if you use the item all the time. Of course, if you鈥檙e rarely using the item, why buy it to begin with?
Take my kitchen knives, for example. Sarah and I received a good (but not great) kitchen knife set as a wedding gift in 2003. The primary knife I used from that set was the chef鈥檚 knife. After about two years of steady use (steady meaning roughly every other day), the chef鈥檚 knife was nearly unusable. I could get it moderately sharp immediately after a sharpening, but the blade would lose what little edge it had by the time I was finished chopping a single carrot. The end result was that I was burning significant time sharpening and honing this poor knife, not to mention the extra time spent actually chopping the food plus the mangled food that resulted from this.
I then invested in a single high-end chef鈥檚 knife, an $80 Global knife. I still use it every other day, but now I hone it perhaps once a month and haven鈥檛 sharpened it in three years. I鈥檇 estimate this knife saves me five minutes over the other knife every single day.
Here鈥檚 the thing: most people would simply shrug their shoulders at five minutes compared to the $80 cost of a knife. However, over the course of three years, five minutes every other day adds up to 2,738 minutes. That鈥檚 about forty five and a half hours I saved not having to deal with the knife. That means my cost per hour saved by that knife is about $1.75.
Now, let鈥檚 say I only used a chef鈥檚 knife once a month, but I still saved five minutes each use from a better knife. Over three years, that鈥檚 36 uses, which at five minutes each adds up to three hours. My cost per hour in this case is about $27.
Clearly, in the first case, the knife was worth it, but in the second case鈥� not so much. The difference between the two is one thing and one thing alone: frequency of use.
So, take Marie鈥檚 case. Let鈥檚 say she uses her hair dryer daily. She finds that after 350 daily uses, her $20 cheap hair dryers fail. On the other hand, her industrial dryer has withstood 7,000 daily uses (roughly) and is still going. For her, the industrial dryer is worth it.
Now, let鈥檚 look at me. I dry my hair maybe once a month. My hair is short and most of the time, a vigorous towel drying and a comb gets me where I want to be.
For me to burn out a $20 hair dryer, I would have to use it 350 times, as per Marie鈥檚 estimation. If I use it once a month, that means I would have to use the dryer for 28 years before it would reach that 350 use level.
For me to reach Marie鈥檚 use level on an industrial hair dryer, I would have to use that hair dryer, at my current pace, for 583 years.
Simply put, it鈥檚 not cost efficient for me to buy an industrial hair dryer. It probably is for Marie, but it鈥檚 not for me. What鈥檚 the difference? Frequency of use.
It is absolutely worth your while to own a quality, reliable version of an item you use every day (or close to that). You鈥檒l save a lot of dollars (and/or a lot of time) over the long run in such cases. However, when you start looking at less frequent usage, the math is going to start working against you.
