What’s the difference? Well, let me share this little anecdote of my recent purchase to explore the two concepts.

I’m a strict penny-pincher and I’ve been often criticized by friends and family of my extreme frugality which actually treads the realm of miserliness. I feel bad spending a reasonable amount of money. Perhaps it’s because I was brought up to believe that spare money belongs to my bank account or in investments rather than be spent on things. Probably one of the things that keeps me from heeding my own advices once in a while (like the one on rewarding oneself.

Yesterday, I “bought” a laptop. It’s supposedly an investment since I’ll be using it as my mobile workhorse to give me flexibility to work remotely and blog whenever I can. It’s a mean little monster, perhaps 6-months dated from being a “new release” but will more than suffice for my blogging needs. With the specs, I can easily do other multimedia related tasks too. It was on sale at USD1,300 including the RAM upgrade from the model’s standard 1GB RAM to 2GBs. Current market prices peg it at USD1400 without the RAM upgrade. It’s a good reasonable deal.

That USD1,300 may not be the largest of amounts but it’s still a reasonable amount of cash. I weighed my options and decided to purchase it via credit card and avail of a 12-month installment plan at 0% interest.

The sales person at the store assured me that they take my credit card and the laptop had a the 0% installment plan. I was all set to go when, at the counter, they informed me that my credit card isn’t part of their installment plans and I had to pay for it straight up if I were to use that card. That was when I was somehow bound to the purchase as I’ve already activated the Windows (I hate Bill Gates). I could have raised hell and opted not to get the laptop or I could have just argued to pay for the OS but the sale proved to be too tempting even for a miserly bastard like me. The sale ended today. Besides, I need it by today since I’ll be out of the house away from my desktops. I’m happily blogging with my new baby.

Good thing I had my sister with me who had a credit card that they allow installments. The unfortunate thing was she already had used it for other purchases and only had about USD700 free. Since banks were closed on a weekend, I had no choice but to max out daily allowable withdrawals from my ATM account pay for half of it upfront in cold hard cash.

Spending cash up-front wasn’t my intention at all. I figured that I could exploit the 0% interest. I even felt bad of the, not that I’d really even earn that USD100 of savings from the sale as interest if the money’s in my account.

While in the long-run it looks attractive as I only need to shell out around USD60 a month, perhaps I just hate the fact that I spent USD650 in one go. The laptop was certainly a good deal but it had me thinking whether it’s a good buy or not. Good buys, for me, do not include spending cash in one go especially since it was a large sum that’s not sitting happily in the bank. Good buys for me are something that leaves me feeling good about a purchase and still with a hefty bank account. And since I didn’t really feel 100% great about my purchase, I found myself not even consider it as one.

But a day after the purchase and in the start of this new love affair with my new rig, the bad feeling began to subside. Besides, it’s a real investment. I bought this laptop to be a workhorse and a money-making machine and I intend to make it just that. The USD650, I will definitely earn in a month’s time and until then, I just have to contend with the fact that one of my accounts has that missing chunk. Perhaps, it will pay-off and turn out to be a good buy after all.

So what’s a good buy for you?