Why Cheap Things Sometimes Cost More

Why It Matters

When people think about what something costs, they almost always look at the price tag and stop there. The shoes in the box with the forty-dollar sticker feel cheaper than the shoes in the box with the sixty-dollar sticker. That feels obvious. It is also sometimes wrong.

The reason it is sometimes wrong is that things wear out. A cheaper thing usually wears out faster than a more expensive thing. Not always. But often. So when you buy the cheaper thing, you are not just paying for one pair of shoes — you are paying for the first pair, and then another pair in a few months, and then another pair a few months after that.

The honest way to think about the price of a thing is not ‘how much did it cost to buy?’ It is ‘how much did it cost for every month you actually used it?’ That is the number that tells you whether a thing was cheap or expensive in real life. Grown-ups call this ‘cost per use’ or ‘cost of ownership.’ You can just call it the real cost.

Once you see this, you start looking at price tags differently. You do not automatically buy the expensive thing — sometimes the cheap thing really is cheaper. You just learn to ask the second question: how long will this last? A cheap thing that lasts as long as the expensive thing is a win. A cheap thing that breaks in two months is almost never a win.

A Story

Two Pairs of Shoes

Theo was growing fast. He had outgrown his old sneakers in the middle of second grade, and his feet were poking at the ends. He needed new shoes, and his mom brought him to the shoe section of the big store on a Saturday morning.

There were two pairs he liked. The first pair had a picture of a rocket on the side. They were bright blue and the sticker said fifteen dollars. “Those!” Theo said immediately. “Those are the ones.”

The second pair were plain black with white laces. No rocket, no picture. The sticker said sixty dollars. Theo did not even want to look at them.

His mom pulled him gently over to a bench. “Before we decide, I want to show you something. Can I show you a little bit of math?”

Theo groaned, but he sat down. His mom took out her phone and pulled up a note where she had written down shoe information from when his older brother had been his age. She had kept track for years.

“Here is what happened with your brother. When he was your age, I bought him the rocket kind of shoes. Fifteen dollars. You know how long they lasted?”

“How long?”

“Two months. The sole came off on one side. Not his fault — they were just not made to last. So I bought another pair. Fifteen dollars again. Two months again. Same thing. Over one whole year, I bought him six pairs of rocket shoes. Six times fifteen dollars is ninety dollars. For one year of shoes.”

Theo was listening now.

“The next year I tried something different. I bought him the plain black ones like these. They cost sixty dollars, and I almost didn’t do it — it felt like too much. But those shoes lasted him a whole year. One pair. Sixty dollars for the whole year.”

She wrote the two numbers on the back of an old receipt and showed them to Theo.

Year of rocket shoes: $15 x 6 pairs = $90

Year of plain shoes: $60 x 1 pair = $60

“The plain ones are more expensive on the sticker,” she said. “But they were actually cheaper — by thirty dollars — because they lasted longer. And that’s before we even count all the extra trips to the store, and all the times the rocket shoes fell apart in the middle of the week and your brother had to wear his old too-small pair to school.”

Theo looked at the numbers. His brain worked slowly through them. Ninety was more than sixty. Ninety was definitely more than sixty. But the sticker on the rocket shoes said fifteen, and the sticker on the plain shoes said sixty, and his eyes kept wanting to believe the stickers.

“So which ones do you actually want?” his mom asked, not pushing.

Theo looked at the rocket shoes one more time. They really were cool. Then he looked at the plain black ones. They were kind of boring, honestly. But thirty dollars was a lot of money, and he had been learning about money all year, and something in his brain had finally clicked.

“The plain ones,” Theo said. “But can I draw a rocket on the side with a marker?”

His mom laughed. “Absolutely.”

Six months later, Theo’s shoes were scuffed but still in one piece. The marker rocket had faded but was still visible if you looked closely. And Theo had started asking a new question every time he picked something up in a store: “How long will this last?”

Vocabulary

Price tag

The sticker on a thing that tells you how much money you have to hand over to buy it. The price tag is only part of the real cost.

Cost per use

The total amount you paid for a thing divided by how many times (or how many months) you actually used it. The real way to figure out if something was cheap or expensive.

Quality

How well a thing is made. Higher quality usually means a thing lasts longer, works better, and costs less in the long run even if the sticker looks bigger at first.

False economy

When something feels like a good deal because it is cheap right now, but turns out to cost more in the end because it doesn’t last. The ‘cheap’ that isn’t actually cheap.

Guided Teaching

This lesson is built around a single piece of math. If you get this math into your head at age seven, you will save yourself a large amount of money over your whole life. So let’s walk through it very slowly.

Imagine two pairs of shoes. The first pair costs fifteen dollars. The second pair costs sixty dollars. Which pair is cheaper? On the sticker, the fifteen-dollar pair is cheaper by forty-five dollars. That is just true. It is not a trick.

Now let’s add the second piece of information. The fifteen-dollar pair breaks after two months. The sixty-dollar pair lasts a whole year — twelve months. How much did each pair cost for every month you actually got to wear them?

Ask your child to do this math out loud with you. Fifteen dollars divided by two months. Sixty dollars divided by twelve months. What do you get?

The fifteen-dollar pair is seven dollars and fifty cents per month. The sixty-dollar pair is five dollars per month. The ‘expensive’ pair is actually cheaper per month of wearing them. And that is before you count all the trips back to the store to buy another pair every two months.

Now run the whole-year version, which is the easiest to remember. In a year, you would need six pairs of the rocket shoes, because each pair only lasts two months. Six pairs at fifteen dollars each is ninety dollars. The plain pair is one pair at sixty dollars for the whole year. Ninety is bigger than sixty by thirty dollars.

This is the whole lesson in one sentence: the cheap shoes cost ninety dollars a year and the expensive shoes cost sixty dollars a year. The expensive ones are cheaper. Say it out loud until it stops sounding weird.

Here is the part that is hard. Your eyes and your brain want to believe the sticker. When you are standing in the store, the fifteen-dollar tag feels smaller than the sixty-dollar tag. Your stomach agrees. Your parents’ wallets agree. The smaller number feels safer. This feeling is almost always wrong for things that wear out, and you have to learn to push past it.

The question that cuts through the feeling is this: how long will this last? Always ask it before you fall in love with a price tag. Sometimes the cheap thing really is the best deal — if it lasts just as long as the expensive thing. But sometimes the cheap thing is a trap. The only way to know is to ask the question.

One more thing. Not every expensive thing is worth it. Sometimes a sixty-dollar pair of shoes is just a sixty-dollar pair of shoes that looks fancy. The lesson is not ‘always buy the expensive version.’ The lesson is ‘always calculate cost per use before deciding.’ A grown-up who understands this is hard to fool in either direction.

For Discussion

1. 1.In the story, which pair of shoes had the smaller price tag? Which pair was actually cheaper by the end of the year? Explain the difference in your own words.
2. 2.Why do you think our eyes and our feelings believe the sticker price so much, even when the math says something different?
3. 3.Can you think of something you’ve owned that broke way faster than you expected? How did that feel?
4. 4.Is buying an expensive version of something always the right choice? When might the cheap version be the smart pick?
5. 5.What is ‘cost per use’ and why is it a better way to think about price than the sticker?
6. 6.Theo drew a rocket on his plain shoes. Why does that part of the story matter for the lesson?
7. 7.Imagine you were picking between a five-dollar umbrella that would break in one storm and a twenty-dollar umbrella that would last for five years. How would you decide?

Practice

The Two-Number Comparison

1. 1.Pick a category of thing that you or your family buys regularly and that wears out — shoes, socks, backpacks, notebooks, markers, headphones, anything.
2. 2.With a parent, look at two real options for that category: a cheaper one and a more expensive one. Write down the price of each.
3. 3.Now ask a parent (or look up online, or use your own memory if you’ve owned both kinds) how long each one tends to last. A month? Six months? Two years? Be honest, not hopeful.
4. 4.Do the math on paper. Cheap price times how many you’d need in a year. Expensive price times how many you’d need in a year. Which yearly total is smaller?
5. 5.Show your numbers to your parent and tell them which one is actually cheaper and why. If the answer surprised you, that is a sign the exercise worked.

Memory Questions

1. 1.What are the two questions you should ask about a price, not just one?
2. 2.In the story, how much did a year of rocket shoes cost? How much did a year of plain shoes cost?
3. 3.What is ‘cost per use,’ in your own words?
4. 4.Why do our eyes and feelings usually trust the sticker price even when it’s wrong?
5. 5.Is buying the more expensive version always the smart choice? Why or why not?
6. 6.What is a ‘false economy’?