May 2008 (perspective of a Ph.D. student)
Here are some thoughts about how to extract the most value out of your material possessions.
Think of an item's price as being spread out over its lifetime
Things are meant to be used. Therefore, you should only buy something if you're going to use it. More specifically, you should only buy something if the amount of use you plan to get out of it exceeds the cost you are willing to pay for each use.
Within reason, don't automatically shy away from purchasing more expensive items when they are made of higher-quality (longer-lasting) materials and when you are more enthusiastic about using them than their cheaper counterparts. It might be worthwhile to invest a bit more money up-front so that you can reap more benefits over a longer period of time.
For example, my Sonicare electric toothbrush is around $100, but I consider it to be a great purchase because I've used it twice a day for over a year, and it's done a great job of cleaning my teeth and gums. That's only 100 / (365 * 2) = 14 cents per use! Hopefully I'll be able to get at least another few years of use out of that toothbrush, which will lower its amortized cost to less than 5 cents per brushing. Viewed in this light, $100 isn't actually so bad.
Another example of a great purchase I've made in the past was my Bose QuietComfort 2 noise cancelling headphones, which was $300. WHAT??? Three hundred dollars for a pair of headphones??? Am I nuts? Well, I've used those headphones probably at least three times a week for the past four years and they still work to this day! As a conservative estimate, that's only 300 / (52 * 4 * 3) = 48 cents per use. And the more I use it, the lower my price-per-use gets!
Buying a crappy $30 electric toothbrush that will likely break and be uncomfortable to use or buying bad-sounding $20 headphones might seem like ways to save money, but if I don't feel enthusiastic about actually using them, then my price-per-use is way higher than that of buying the more expensive but higher-quality products.
Of course, in real life, we can't really predict how often we will use a particular purchased item. I've certainly bought gadgets that have sat in my closet and collected dust from lack of use. Even if those items were super-cheap, they are still not worthwhile purchases because I've gotten almost no use out of them.
When you purchase a new toy, electronic gadget, or personal item, make sure to use it as often as you can
This is another bit of advice that sounds like it came straight from the mouth of Captain Obvious, but it took me many years to really accept it. When I was younger, I would always be overprotective of my toys, never wanting to get them dirty or risk breaking them. Whenever other kids touched my action figures or video games, I would instantly grow defensive and make sure that they weren't going to break anything. But now I realize that material things are meant to be used to provide humans with utility and happiness, so it was silly of me to be so overprotective of my toys and risk alienating my childhood friends.
A new gizmo or gadget is no good if you just leave it in a shiny display case all day and don't take it anywhere with you to use it. You need to accept the fact that your items are going to eventually malfunction or break, probably due to overuse, but trying to delay their inevitable death by being extra careful around them and not using them to their fullest capacity defeats the whole point of buying them in the first place, which is to make yourself and people around you happy. Don't be afraid if your pristine iPod shell gets scratched up—it still works! Don't be afraid if your laptop gets a bit banged up from you carrying it around everywhere with you—its job is to serve you, so if you just leave it at home all protected, then it doesn't get a chance to fulfill its role!
In the context of the previous tip, the more frequently you use something, the lower its price-per-use becomes, and the 'cheaper' that item's actual price to you becomes. The most worthless kind of item is one that sits in your room unused and collecting dust.
Of course, I'm not telling you to abuse your possessions and purposely treat them roughly. That's just silly. But don't err in the other direction of being overprotective of your possessions like I did when I was a kid. The best way to show love to a material possession is to use it for all it's got until it no longer serves its duty. Only then should you say your tearful goodbyes as you throw it away; you will be comforted in knowing that it's lived a fulfilling life.