Podcast: Spend money to save money

In Latest, The Fat Wallet by Kristia van Heerden

You can find the Satrix webinar we mention at the top of the show here.

Isn’t it odd how few money conversations centre around mundane financial choices? Surely our net worth is a reflection of the small financial decisions we make every day. A rather typical experience with a contractor has me questioning my decision-making this week. Do I need to think differently about the intersection between price and quality? I asked your help and got some really excellent ideas. Simon and I think through many of them in this week’s episode of The Fat Wallet Show

I loved all the feedback we got. Unfortunately my favourite new way of thinking came in after we recorded the show, but here it is:

The bleeped show is below:

Your feedback:

Oscar: If the price difference is marginal, I’d go for convenience, or for good service, or both. If the price difference is sizable, there is bound to be third party published material where this difference is explained [in detail].

Tamara: Depends on the thing. Some things are worth paying more for because they yield a better experience or last longer than cheap alternatives (e.g. decent tools, leather boots). Other things, I take the best price I can get (e.g. refill on my gas bottle, cat scratching block)…

There’s also an element of risk that gets factored in to value equations on some stuff. I’m not going to go hunting for cut-rate medical specialists or the cheapest backyard mechanic. I’ll willingly pay more if I believe it translates to better care.

Duke of Prunes: Generally the cheapest thing with the most favourable reviews possible.

Manus: My problem is to figure out if I really do need the thing, if I do need the thing I have to figure out how important the quality is. If quality is important I will overpay if need be.

Overpaying because it is pretty isn’t reason enough to overpay.

Daniel: How much I will be using it will also determine how much Im willing to spend. The more I will use something the more Im willing to pay for better quality versions.

Rudi: If it separates you from the ground, go for quality (shoes, bed, tyres)


Sheila: Depends .. may buy cheapest item, find it is inefficient, and revert to an expensive product. For instance – dishwashing tablets.

Wilhelm: Some brands offer amazing quality products but also at a increased price. If I know the product will last a lifetime, I don’t mind paying extra (Stanley Flasks, LED lenser headlamps).

Greg: I generally go for quality, my big exception is cell phones, in my mind they do the same job, so I just buy the cheaper Chinese brands for cash; I just can’t justify shelling out 15k plus for a cellphone.

Wynand: Here I actually differ. I feel I interact with this device for HOURS everyday so I soend money to make that experience a pleasant one.

Shane: in the kitchen i can tell the difference between a R1000 pan and R90 pan. the latter is so wobbly it barely touches the stove. no more skimping on kitchenware for me , no matter what the cost ???? i skimp on phones (R200 nokia), cars (none)

Andrew: Cost per Use is my go to metric to guide those decisions

When I was poor was the king of cheap for a long time and it didn’t work.

But then I started looking at the Cost per use.

Now I am well off- by no means ready to retire. But comfortable- now I try to look for high quality stuff but usually second hand – like GPS watches, Baby stuff – prams, cots etc.

Sometimes on certain products I buy new. 

Down jackets for winter – super expensive when I got them (I have two). But I wear them just about everyday in winter for the last 6 years and they are going to last at least another 6 years or so. My wife will be sick of them – but much better investments than the R300 fleeces and jackets I was buying before almost every year or so.

So a R900 down jacket (price 7 or 8 years ago) over 10 years works out to about R1 a use (90 days a year). If I had bought my regular jackets I would have spent R4000 over the same time period (with inflation) and not been as warm.

Same goes with a good cast iron pan. Knives, I buy good quality and I sharpen them regularly and have a magnetic knife rack.

My grandkids will probably use my knives and cast iron pan.

Max: Certain important items I spend on especially if I know it will last based on experience ie. shoes, tyres, laptop. Other things I’ll buy the cheapest I can get. I hate buying the same thing twice ????

Win of the week: Jaco and Hester

Been bingeing the Fat Wallet Show for over a year, and it’s been a major force in how I think about my money. 

I’ve even started doing a tiny bit of financial education myself – just around my own sphere of influence 🙂 Something which struck me hard when starting to take control of my money is exactly this concept: nobody is coming to save me. 

For example, I used to play the lotto and dream fantastical dreams of what I will do with the money. But your podcast and Sam’s book (where she makes you add up all your future paychecks) made me realize I’m in this by myself. 

What I can’t achieve on my salary alone can not be achieved. And it’s made a massive difference to how I spend (or don’t spend) my money. I did a small money workshop with my friends last year, and I had to confront them with this concept early on, and see how something shattered behind their eyes – something they didn’t even know was there: the deeply rooted belief that “one day I’m gonna be rich – by some magic”. I also saw what you’ve been espousing for a while: when someone is not ready to hear it, nothing I say matters.

Anyway, thanks for a great show, and a great job you guys are doing. You’ve got a Fattie in me!

The Fat Wallet Show with Kristia van HeerdenThe Fat Wallet Show is a no-nonsense personal finance and investment podcast hosted by Kristia van Heerden and Simon Brown. Every week we answer questions by a growing audience of finance enthusiasts. Submit your pressing money and investment questions to ask@justonelap.com.

Subscribe on iTunes

Upcoming webinars

Click here to meet the Just One Lap team at one of our live, free events.

Subscribe to Just One Lap