Buy Cheap or Buy Reliable?

I use headphones for multiple hours per day. Whenever I’m listening to audio, I’m usually doing it with some type of over-the-ear headphones or earbuds unless I’m intentionally sharing the audio with others. Yep, this is even true when I’m home alone.

My hearing isn’t great so I honestly can’t tell the difference in audio quality above perhaps the bottom 10%, so what I’m really looking for above all else is reliability versus cost, provided it executes the core functions I want from it well, with a small dollop of convenience on the side. That’s the main factor in determining which headphones I buy. Are they built to last for a while? Or are they flimsy? How long will they last under my own brand of normal use, meaning I’m not super-careful with them and I don’t treat them as incredibly fragile?

There are actually a lot of concepts tied up in that thought process, and it ends up informing a lot of the buying decisions I make. Let’s dig into that balance between cheap and reliable a little bit.

The factor I’m really looking at is total cost of ownership.

If I want to boil down my questions about which product to buy to a single question, it would look something like this:

Assuming that an item does the minimum of what I expect from it, what’s the version that will give me the lowest total cost of ownership over, say, the next twenty years?

For example, if I buy really cheap earbuds that last for three months under my regular use for $10 versus a pair of earbuds that will last for three years under my normal use for $100, what’s the better deal? The $100 ones are, because I’ll have to buy twelve pairs of the cheap ones to last that long.

If I buy a car that will run for 100,000 more miles for $10,000 or a car that will run for 250,000 more miles for $20,000, the $20,000 car is the better deal, because I’d have to buy two and a half $10,000 cars (totaling $25,000) to get the same miles as one $20,000 car.

Sometimes, the balance is on the cheap side, though. If I buy a smartphone that will last three years for $200 or a smartphone that will last six years for $800, the $200 phone is better, even though I have to buy two of them at $200 a pop. That’s still only a total cost of $400 over those six years.

You should also remind yourself that a product with just a few core features is likely to last longer than something with a lot of bells and whistles. The more features and internal components something has, the more points of failure it has. You’re almost always better off identifying the core features you actually need and ignoring the rest.

There’s another factor to consider.

“Cost” doesn’t mean just dollars and cents, either.

If the price is close at all, I almost always go for the more reliable option. Why? I have to spend time and effort — and likely some driving time, which has a cost — every time I have to replace something.

Even if I just go to Amazon and buy a replacement, I’m still dealing with the frustration of the item breaking, dealing with getting rid of the broken item, and going through the ordering process. If I have to go shopping somewhere locally to replace the item, I’ve compounded the problem.

Furthermore, there’s the issue of the “slow decline.” Sometimes items, as they’re failing, can still be used to a certain extent and we muddle through, using the item in a frustrating and mediocre way until it finally completely fails.

My last smartphone, an iPhone 5, had this problem. I accidentally damaged the charging port on it so that it would only charge under the most perfect of conditions and when I tried to get it repaired, the repairperson informed me that I just needed to get a new phone. Sure enough, I kept trying to use it for a while, doing various postures and incantations every time I tried to charge it. That was lost time and a lot of frustration, too.

It’s very difficult to perfectly estimate reliability.

It is really hard to perfectly predict reliability in consumer goods. The length of a warranty can be a clue, but it’s still impossible to tell how long the item in the box will last.

I tend to rely on a few factors for determining reliability.

First of all, is the item something I can easily take to have repaired? Where would I take this item to have it repaired? Would it even be worth having it repaired? For example, a pair of well-made shoes can be repaired in many places, but a pair of cheap shoes often can’t be repaired or isn’t cost-effective to do so, so a defect in cheap shoes means you just toss them whereas a defect in nice shoes can be inexpensively fixed. The same is true with electronics – you can get an iPhone repaired but a cheap phone can’t be.

Another factor I use is brand reputation. Brands that have a longstanding reputation for reliable products are ones that I’m likely to turn to when buying items. For example, clothing from LL Bean and Darn Tough, cars from Toyota, water bottles from Nalgene, and so on. I tend to accumulate this kind of information over time as a result of reading lots of reviews and having lots of experiences with the product, both personally and via word of mouth from friends I trust.

Speaking of reviews, I trust comparative reviews from Consumer Reports for reliability scoring. They tend to provide good insight as to which models are going to be reliable, both through direct product testing and surveys. I tend to trust their product reviews and comparisons.

Since I usually can’t find this kind of detailed information about low end cheap products, I usually do Google searches like “how long do cheap earbuds last” or “how long will cheap socks last” to get an idea for comparison’s sake. The result usually points me towards a forum where I can get some idea as to how long the cheap version will last.

These factors give me a good idea of how reliable a product is going to be, but it’s still not perfectly quantifiable. I use these as a rough estimate.

This adds up to a sensible buying strategy.

My usual strategy for buying non-consumable items is to buy them as cheap as possible the first time, see whether or not I use the item enough to warrant replacement, and then, if I do, weigh the value of an expensive version.

My oldest son’s experience with earbuds is a great example of this. He listens to music in his earbuds when walking to and from school and also sometimes in the evenings. A typical pair of $10 earbuds would last him for three months or so, then he’d have to do without for a while until he could get another pair and spend another $10. He was getting tired of this routine and started looking at more reliable models.

He decided that he wanted AirPods, which cost about $150 new. They come with a yearlong warranty and seem to have a very long lifespan, as he has friends that have used them daily for more than two years. One friend had the batteries replaced fairly recently for a small charge. They seem to have a pretty long lifespan under normal wear and tear. However, the cost of a pair is equal to almost four years of cheap earbuds.

He decided to save up his own money and buy them, using birthday gift money and saved allowance money. The reason? He wanted something he could rely on every day, since they were everyday use items for him, and he didn’t like the frustration and downtime of other earbuds when they were dying. (While I’m not sure I would have settled on the same product choice he did, I am proud of him for actually following the principles I described here, doing a lot of homework on the purchase, thinking about the value of reliability versus price, and making a thoughtful decision).

That’s really the key. If the item is a daily use item for you and you are highly frustrated by failure of that item, it’s well worth paying more for a reliable item because you’re paying not to be frustrated. On the other hand, if the item isn’t something you use very often and it’s not a big deal if it fails, go cheap with it.

It’s really a total cost of ownership thing. Something used infrequently is going to last for a long time even if you buy the cheap version, so buying the expensive version is a bad expenditure of money. On the other hand, if you use an item all the time and failure comes with a cost (in terms of frustration and of replacement), then reliability has an extra premium value for you. In that case, unless your research shows that you’re not gaining much reliability by spending more, you should lean toward the reliable item.

Good luck.

Trent Hamm

Founder of The Simple Dollar

Trent Hamm founded The Simple Dollar in 2006 after developing innovative financial strategies to get out of debt. Since then, he’s written three books (published by Simon & Schuster and Financial Times Press), contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.