My friend Jim from WalletHacks asked me a question last week. It was along the lines of, “What is your best personal finance tip?”

I’ve been asked this about a dozen times. There’s the obvious money golden rule of “Spend Less Than You Earn”. That’s too easy though. Every personal finance writer would likely say the same thing.

Rather than give that answer, I’ve always responded with “the more a purchase costs, the more you should research it.”

Then I realized that I never wrote an article about it. I’ve been giving this information to everyone else except my readers. What an epic fail! (Is describing something as an epic fail in 2015, an epic fail itself?)

I think the concept is fairly self explanatory, but let’s dig into anyway.

There are some things that are going to matter greatly in your personal finance life. They are usually big purchases such as houses, cars, weddings, even having kids. (Yes, I know kids aren’t a purchase, but that decision spawns a lot of other purchases.) Then there are things that aren’t going to matter so much, such as adding some gum at the grocery checkout line.

If it’s a big purchase that’s going to be part of your life for some time, it’s worth putting a lot of thought into it. I had a friend who thought about a purchase of a car for a couple of years. That’s an extreme example. If we were discussing a $700 coffee table book, I’d probably have to think about it for 4-6 months. Okay, I’d simply reject it on the grounds that it is a $700 coffee table book, but if it were something a little more practical I’d put some time into it.

When I take this time, I usually find that I don’t need it at all. Sometimes I realize that I don’t even want it. I’m not immune to impulse buying, but having this policy in place substantially curbs it.

I realize there’s a difference between researching and thinking about a large purchase. However, I’m going to lump them together. I often tell myself that I’m “researching the best option”, when I’m really debating whether or not I need something new. For example, I’ve been researching the best television for a few years now, because (and don’t tell my wife I wrote this), our current generic 55″ television does the job. (For those wondering, this is the best television.)

The biggest exception to this rule is subscriptions. They can be large purchases, you just pay for them over time. I bet some people pay more for their cable bill than other people pay for their cars (on a monthly basis). It’s definitely worth spending some time to think about those as well. I put daily coffee and lunches are in the same category of subscriptions, they are a lot of the same small purchases that add up. If you can change your habit to do other things that may be more frugal, you’ll save a lot of money there too.

If you did nothing else but follow these two bits of advice, you’d have solved about 80% of money’s golden rule of spending less than you save.

P.S.

I couldn’t think of a good image for such an abstract concept… but I enjoyed this image of a pile of money from Breaking Bad.