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4 Tips for Knowing When to Spend and When to Save

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Even the most reluctant spenders understand that there comes a time when they have to spend money. They even recognize that there are times when going with the cheapest option is not a good thing. They just have a little trouble sorting out how to recognize those times.

It is not just those obsessed with saving money that experience this problem. At some point, it happens to us all. We all have certain blind spots when it comes to spending money. We routinely overspend on things we don’t have to. And we frequently hold back when we should be investing at a higher level. Here are a few tips that will help determine when to spend and when to save:

Spend When a High Level of Skill Is Involved

We can live with airlines cutting corners on everything except the maintenance of the plains and the quality of pilots. We also agree that discount surgery is out of the question. Home construction is another one of those areas where skill is worth the premium.

Solar panels like the ones you may buy from Ion Solar require an installer with a high level of skill and experience in the same way that a high-end heat pump does. It is not as simple as slapping panels on a roof and calling it a day. An installer has to know the particular system well, along with knowledge of roofing, electricity, wiring, and more.

When you have a project that requires a large amount of a rare skill, the least expensive thing you can do is spend the money up front to ensure that the job is done right the first time. On such jobs, the less you spend up front, the more it will cost you in the long run.

When Our Needs Can Be Met with Less

Not everything has to be the highest quality, longest lasting product of its kind. At such times, save as much as you can. We have to be honest with ourselves about our motivations for buying things. We tell ourselves that we need the best. But that is often untrue.

If you are not a professional photographer, you do not need the best camera. Very few of us need the best set of headphones. We don’t have to wear the best suit. And there is no scenario where we must eat at the best restaurant by necessity.

We have to acknowledge those times when good enough is good enough. Everything above that is just emotional spending. Learn to buy products that satisfy your needs. It is likely not your needs, but your emotions that are expensive.

When It Affects Your Livelihood

When it affects your livelihood, it is time to spend a bit more. If your job depends on your ability to get things done while on the go, you need a mobile device you can count on to work when you need it. A $200 Android phone with questionable security and no updates is likely the wrong choice for a work phone.

If your business depends on crisp and clear printed documents, you might want to spend a little more on a decent laser printer as opposed to the ink jet that costs less than a replacement cartridge. It is time to spend a little more when saving money will lose you money..

When You Can’t Tell the Difference

It is time to save money when you can’t tell the difference between the output of products you are comparing. It doesn’t matter how much better 4K is than 1080P if your vision will not allow you to tell the difference. You can buy the $300 speaker instead of the $200 if you like. But most can’t hear the difference.

Some people upgrade their smartphone specifically for the camera. But in fair comparisons, most people can’t tell the difference in the pictures taken between one camera and another.

At the end of the day, the rule is to spend the money when it matters, and save it when it doesn’t. Professional services and things that affect your paycheck matter. Emotional gratification and picayune differences do not.

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