In today’s economy, no one has money to spare, which is why we’re all on the lookout for anywhere we can slash costs. Unfortunately, trying to cut short-term costs, can actually cost you more in the long-term.
There’s a reason “cheap” is a term with negative connotations, and it’s because often inexpensive items break easily or become obsolete and then must be replaced. The items that may cost you more in the long-term if you choose them for their low short-term cost can vary from electronics to children's toys to lawn equipment but are all susceptible to some combination of the following characteristics.
The way that many companies are able to offer inexpensive options to consumers is by making their products out of the cheapest materials available. This often means the end product will be brittle and won’t be able to hold up to repeated use. Better to invest in a single high quality at the beginning then two poor quality ones.
Something you have to watch out for when buying something is obsolescence, that they’ll become useless over time. While something like a cup or chair hasn’t fundamentally changed shape in the last hundred years, electronics from only a few years ago are already obsolete. For example, as ubiquitous as smartphones are today, it’s only been around eleven years since the iPhone first launched: and no one today would think to carry that first model in their pocket today for everyday use.
To stay with the example of electronics for a minute, often cheaper options are more limited in their use. So far example, often lower-end laptops won’t be able to run complicated programs. Or for another example, a cheaper vacuum may not have detachable hoses or fixtures, meaning you simply won’t be able to do as much with it. In both cases, you’ll eventually have to either upgrade to a more expensive product or buy a secondary dedicated product, both of which will cost you more than you originally would’ve spent on a quality product in the first place.
As the saying goes, time is money, but often we tend to devalue how much our time is worth. This can cost you more in the long-term if you buy something that’s cheaper but requires more effort on your part. For example, a low-end lawn mower will cost you less initially, but it means you’ll end up spending longer on the lawn each month.
This is most noticeable with food, where the quality of ingredients can have a massive impact on your health. Sure, that burger costs less right now, but the processed ingredients and overload of oil and salt means that in twenty to forty years you may suffer from diabetes and heart disease, both of which are expensive conditions to treat that can cost you hundreds of thousands in medical costs.
Let’s paint a picture. Say your car breaks down, but you don’t have money. It happens. So, you pay the minimum to get your car fixed. But the same problem reoccurs, and this time it will cost even more to fix, and you’ve already sunk in the initial price of repair.
The last way being cheap can cost you more money in the long-term is by missing an opportunity because of frugality or a lack of funds. Luckily, this is easy to fix with an installment loan, which can give you the financial options you need when you need them.