Everyone has experienced that sinking feeling after making a large purchase and later realizing it was a mistake. Sometimes it takes months or even years to recognize how much of a waste the purchase was.
Mistakes like this can result in:
- Frustration and shaking your head.
- Wishing you’d spent the money on something more valuable.
- Regret over the purchase.
- Anger at yourself for wasting money.
- Falling into debt.
But you don’t have to repeat those mistakes. Before completing your next sizable purchase, ask yourself a handful of questions to ensure the purchase is truly worthwhile.
Note: A “large purchase” is subjective. For some people it might be $50; for others, $1,000 or more.
Whatever the amount, pausing to consider a few key questions can save you money over time and help you avoid future regret. Here are important questions to ask yourself before making your next large purchase.
1. Can I afford it?
Affordability should be the first and most important question. If you can’t afford the item, don’t buy it. Plain and simple.
Avoid putting yourself into unexpected high-interest debt or stretching your budget just to make a purchase happen.
2. How long did it take to earn the money for it?
Think about how many hours of work the purchase represents. If the item costs $100 and you earn $20 per hour, that purchase equals five hours of work. If those five hours don’t feel worth the item, you may regret the purchase later.
3. What else will the item cost over time?
Buying something often isn’t a one-time expense. Consider the ongoing costs associated with it:
- Interest: If you finance the purchase, how much will you pay in interest over time?
- Maintenance: Cars, homes, appliances and other items often require upkeep that adds cost.
- Related purchases: Some items require accessories, supplies, or future spending (for example, adopting a pet comes with food, vet visits, and other costs).
Add up the total long-term cost before deciding.
4. What else could I spend this money on?
Consider alternative uses for the money. Reflecting on other priorities or goals can help you determine whether this purchase is the best use of your resources.
5. What mistakes have I made on big purchases before?
Look back at similar choices you’ve made. Did they make you happy or lead to regret? Learning from past mistakes can help you avoid repeating them.
6. Can this wait 24 hours?
If the purchase can be delayed for a day, wait. Giving yourself at least 24 hours helps reduce impulse buying, lets excitement fade, and gives you time to make a more rational choice. Often, delaying will reveal that you don’t need the item at all.
7. Where can I find the best value?
Shop around. Compare prices online and in stores to find the best value. Prices can vary widely, so a little research can save you money.
8. Can I borrow or rent it instead?
If the item isn’t something you’ll need permanently, consider borrowing from a friend or renting. That can save money and prevent clutter. If you borrow, remember to return the favor when you can.
9. Where will I store it?
Consider whether you have space for the item. Living in a small space—like an RV—makes this question essential, but even in a larger home, you should know where the item will go. If you don’t have a place for it, you might not actually need it.
10. Is there a return policy?
For larger purchases, a clear return policy is important. Check whether returns are accepted, whether you’ll get a refund or store credit, the return window, and any warranty details. This gives you an option if the item turns out not to meet expectations.
11. Do I really need it?
Finally, ask whether the item is a true need or just a want. Many people skip this basic question, yet it’s one of the most important. If you’re living paycheck to paycheck, carrying high-interest debt, or otherwise financially constrained, prioritize necessities and postpone big splurges.
What questions do you ask yourself before making a large purchase? How have those questions helped you save money?