5 Expensive Products That Will Actually Save You Money
The old saying "you have to speculate to accumulate" does not just apply to those in the investment industries. If you're spending a little more to get a return on your initial outlay, that works in all aspects of life; and the purchases you make are equally applicable. (See also: 15 Items to Pay More For)
Now, the word expensive is relative. What's costly for one person is peanuts to another. So in this article, expensive refers to the competitive products in the marketplace. Why should you shell out your hard earned money on a brand or product that has a much higher price tag than those in the same category?
One word: savings. The products featured here will cost you more up front, but over time they will save you more money than their cheaper counterparts. It's called Return on Investment, or ROI, and you can see an impressive ROI on the following items.
1. Energy-Saving Light Bulbs
They're taking up more and more shelf space in the retail stores, but so many of us still go for the traditional incandescent bulbs. And we do it for one reason — cost. The initial outlay for an energy-saving light bulb is many times the cost of an incandescent. Sometimes, as much as ten times more. It's hard to plump for the pricey option when you can't see the long-term benefit. But Energy Star bulbs last between 10 and 25 times longer than the cheap bulbs, and use 75% less energy. Over the life of the bulb, that initial expense can be returned ten-fold, saving you up to $135. Think about it next time you're pondering in the light bulb aisle. (See also: Best Energy Efficient Light Bulbs)
2. Professional Power Tools
There are varying levels of power tools in the home improvement industry. They start with entry-level tools, priced low for the inexperienced and infrequent user. Then, the price goes up until you hit the level that professionals use. But here's the thing. Those cheap tools are not simply more basic models with fewer features. Cheap tools are inferior in so many ways. Build quality is far better in professional tools, with inferior materials used in the cheaper versions. Professional tools are designed to transfer power more efficiently, and will last much, much longer. The bottom line…if you plan on buying a power drill, sander, circular saw, or anything else in that vein, never go for the cheapest option; you'll be back to the store again and again. And over the course of your lifetime, you'll spend more on tools if you buy one just professional tool that will last you forever. (See also: How to Stock Your First Toolbox)
3. Cloth Diapers
Any parent that has looked into cloth diapers, or has actually used them, knows that the up front costs are a little scary. It can cost around $500–$600 to buy the cloth diapers, the plastic covers, and the additional inserts. Compare that to $40 for a box of diapers, and many parents get sticker shock and go for disposables. But cloth diapers pay for themselves many times over, saving parents at least $1,000 over a two and a half year period. When you buy disposable diapers, you really are throwing money in the garbage. (See also: Where to Get Cheaper Diapers)
4. Hybrid Cars
The original hybrid cars were not that good to look at; let's be honest, they were boxy, clunky, and looked about as sexy as a concrete slab. But technology has improved vastly, and now hybrid vehicles are almost identical to their gas engine counterparts. However, there's usually a higher price associated with the hybrid model. Is it worth it? Well, that depends on the make and model of car, but in many cases, yes it's a money saver. For instance MSN Autos recently listed the top money-saving hybrid cars, and the Lexus CT 200h came out on top; its five-years savings over conventional models — $6,379!
What about electric cars, you ask? The numbers aren't quite as favorable. In a state like California, with generous rebates for EV buyers, a Nissan Leaf buyer would have to wait six years before realizing any savings over a comparable gas powered vehicle.
5. Solar Power
Just like hybrid cars, solar power is becoming increasingly popular. But the big question many people have is, will I ever recoup the high initial cost of installing solar panels on my home? The answer, increasingly, is a big yes. A $20,000 system will instantly get you back around $6,000 in tax credits. You could also get an additional $1,000 state grant, bringing the initial outlay to about $13,000. A system like this will save you over $1,000 in electricity, and you'll get extra $900 a year from Solar Renewable Energy Certificates (SRECs). After seven years, the system has paid for itself. From then on, you're just pocketing the savings, with the average lifetime ROI coming in at almost 400%! (See also: Cut Your Electric Bill With Solar Panels)
And if you're using your panels to charge up your electric car, you can push it to break even sooner, too.
Any other expensive purchases that result in savings over the long term? Please share in comments!