Should you buy the cheaper alternative? A simple test

Verdict: the cheaper alternative is right when you will use it little or when the missing feature is one you would not touch. It is wrong when you use it every day or when a failure would cost more than the saving.

If you are asking whether to buy the cheaper alternative, you are really asking what you lose. This page gives a three step test with round example numbers.

The three step test

1. Name what the cheaper one lacks. Look for the real difference: smaller size, less power, shorter warranty, fewer settings.
2. Ask how often you would notice. Daily, weekly, or almost never.
3. Ask what failure costs. Does it break and ruin something? Or do you just replace it?

Ruling: if the answers are "almost never" and "just replace it," buy the cheaper one.

Use per year, not price on the tag

A simple way to compare price: divide by uses.

Say a $ product lasts two years and you use it 100 times a year. That is 200 uses. A $$ product lasts six years at the same rate: 600 uses. The $$ one can be cheaper per use even if it costs more upfront. These numbers are examples, not real prices.

Now flip it. If you only use it 10 times a year, the $ one covers 20 uses and the $$ one covers 60, but you may sell, move or lose interest first. The cheap one then wins.

What usually differs

In general, the cheaper version differs in these ways:

• Thinner materials or lighter parts.
• A shorter warranty.
• Fewer extras and settings.
• A less quiet motor or a smaller battery.

Some of these are fine. A shorter warranty on a thing you replace every year is fine. A thinner base on a pan you use daily is not.

Ruling: ask which of these differences you would feel with your hands or ears every time.

When cheaper is the better buy

• You need it for a short period, such as a rental flat or a single season.
• You are trying out a habit, such as cooking at home more, and do not know if it will stick.
• The expensive version adds features you never use.
• The product is easy to replace, and failure only costs the item itself.

When cheaper costs more

• The product is used every day and wears out.
• It touches safety, such as a bike helmet, a smoke alarm or a child car seat. Follow the official standards and the maker's guidance, not the price.
• It needs spare parts you cannot find later.
• It holds something valuable, such as a laptop bag or a lock.

A quick example

Two phone chargers. One is $ and one is $$. If you only charge at your desk, the $ one is fine. If it lives in your bag and gets bent every day, the stronger cable may last longer. See also why "best for the price" means nothing for how to avoid being sold on a vague value label.

For a method that works on any two products, use the five questions before any vs purchase.

Common mistakes

• Buying cheap for something used daily.
• Buying the pricier one for features you will never use.
• Judging by the tag, not by cost per use.
• Ignoring the warranty gap.