When is it better to pay more? 5 times when being cheap is a bad idea

When you're young and broke, life is all about finding good deals. So it makes sense to try to spend as little as you can. After all, there's no reason to pay any more in cell phone charges and bank fees than absolutely necessary.

But there are times when shopping based on price alone is a mistake. Buying the cheapest item can wind up costing you more in the long run — hurting both your health and your wallet.

Here are five times when you shouldn't be a cheapskate.

Going grocery shopping

Buying fresh, nutritious food instead of a 99-cent box of mac and cheese is going to cost you more cash. In fact, healthier diets typically cost about $1.48 day more than poorer-quality diets, according to a British Medical Journal analysis of 27 studies published between 2000 and 2011. That's an additional $540.20 per person each year.

If your food budget is tight, it's easy to get hooked on cheap, processed foods. But food that's high in calories but low in nutrients can do serious damage to your body, including increasing your risk of diabetes and heart disease. People whose diets are higher in processed meat, fried food, refined cereals and sweet desserts are more likely to report depression, according to the Mayo Clinic. All of this can lead to high medical bills and a lower quality of life.

The good news is you don't actually have to sacrifice health, budget — or flavor. There are lots of tasty, healthy types of food you can afford that simply may require planning ahead to prepare: Read up on recipes featuring whole grains, vegetables, fruit, fish, beans, nuts, seeds and healthy fats. And here's Mic's guide to eating healthy, delicious foods for less money.

Picking a health insurance plan

If you're paying for your own insurance, you're probably going to look for a plan with the low monthly premiums. That could be a problem if you ever actually need to use your insurance since lower premiums tend to go hand in hand with higher deductibles.

While the Affordable Care Act ensures minimum coverage standards, some plans have much higher co-pays and deductibles, while others have really small networks, which strictly limit your choice of doctors. Your "cheap" plan could cost a lot more than you budgeted if your insurance doesn't kick in until you've paid a $5,000 deductible.

Skip health insurance altogether, and you'll pay a penalty of up to $2,085 a year under the current health law. If the Affordable Care Act gets replaced, you could be slapped with a 30% surcharge if you skip coverage for a while, then sign up later. Under the proposed Republican plan, providers can charge higher rates for anyone with a coverage gap of more than two months.

So be smart and get a decent health plan — and use this guide to find one.

RELATED: Easy money hacks that'll help you get rich:

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31 easy money hacks to help you get richer every single day this month
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31 easy money hacks to help you get richer every single day this month

1. List at least one item you aren't using on Craigslist or eBay.

Not only will this help you clear out clutter, but it will turn an unwanted item into cash. If you get inspired and want to sell more, check out this Lifehacker guide to turning unwanted junk into cash.

REUTERS/Kacper Pempel/File Photo 

2. Pack your lunch instead of buying it.

Time calculated how much someone in New York could save by bringing a brown bag lunch ($3) versus buying lunch ($15). At that rate of savings, if you packed lunch instead of buying it every day for a decade, you'd save $31,200. Calculate how much you would save using this Bankrate tool.

(KatarzynaBialasiewicz via Getty Images)

3. Change out at least one incandescent bulb to a CFL.

According to Consumer Reports: "By replacing a 60-watt incandescent bulb — the most common household bulb — with a spiral-type 13-watt CFL that produces an equivalent amount of light, you could save more than $57 over the life of the CFL."

(Jose Luis Pelaez)

4. Program your thermostat to turn off while you are at work or sleeping.

According to Energy.gov, "You can save as much as 10% a year on heating and cooling by simply turning your thermostat back 7°-10°F for 8 hours a day from its normal setting."

(Getty Images/iStockphoto)

5. Delete your stored credit cards from online accounts.

Have your credit card stored to make one-click purchases? If you instead have to manually enter your card each time, you make buying online more of a hassle, which will limit impulse purchases.

(Shutterstock / Vladimir Gerasimov)

6. Eat meatless.

Many people have adopted Meatless Mondays to help save money and the planet. Start this Monday and see if you can make it a habit.

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7. Buy a re-usable water bottle.

Consumer Reports calculates that bottled water costs $346 a year, while tap water costs just $0.48. If you are using bottled water, stop now and start refilling a water bottle instead.

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9. Download at least one money-saving app.

Check out Mic's guide to apps that will save you money. And U.S. News also has a list of nine apps to save you on everything from parking to cheap beer.

10. Cancel any memberships you aren't using.

Planet Money report found that half of all members of one popular gym never go — and the Washington Post reports the gym industry actually relies on members paying for, but never using, the service. Don't let money be auto-debited monthly for anything you don't actively use. Call now to cancel, and read Mic's guide to getting fit for free.

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11. Make sure you are using the right bank.

Check out what unnecessary fees you pay for ATM use and for maintaining a monthly account. If you're paying anything, it may be time to switch to a different bank: Check out Mic'guide to some of the best banks to use in 2016 to 2017 and see how your bank compares. If your bank falls short, make the switch.

12. Open an IRA, if you don't already have one. If you do, check on your investment mix.

An IRA is one of the best ways to save for retirement because you can potentially get tax breaks for investing in it. Check out this 5-minute guide to retirement savings to find out more and follow this simple step-by-step primer on opening one. If you already have an IRA, use an asset allocation calculator to see if you have the right mix of investments. 

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13. Create (or review) your budget. 

Read up on the basics of how to budget so you can determine the steps you need to take to get a handle on where your money is going. You can also use recommended budgeting apps to make the process easier. 

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14. Make sure you are using the right credit card.

Figuring out the best credit card for you is a matter of looking at your usage and needs. If you carry a balance, it's time to shop for a low APR card with a 0% balance transfer. But if you are a responsible card user, aim for a card with big cash-back perks or rewards.

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15.  Clean out the air filters in your car.

Pro Car Mechanics explains: "The benefits of a clean air filter are almost immediate. Airflow goes back to the proper level to mix with the gasoline. It has been estimated that replacing the dirty air filter will increase MPG on the car up to 10% and also generate a fuel savings of close $.15 per gallon at the fuel pump." Cars Direct explains how you can clean out your car's air filter. 

16. Review your debts and make sure your repayment approach is optimized.

If you owe money on credit cards or loans, review the interest rates, terms and repayment strategy. If you have high interest debt, refinancing could make sense.Think through your debt repayment strategy and evaluate whether you can or should make extra payments.

(BernardaSv via Getty Images)

17. Call your cell phone and cable companies.

Go over your monthly plans to find out if you are paying for services you don't need. Ask for any discounts that could potentially help you to spend less. Check out these tips for saving money on cable TV.

(diego_cervo via Getty Images)

18.  Sign up for a library card.

Many libraries now offer streaming video and electronic versions of books so you don't even have to visit the library to take advantage of their media. This website will help you find your closest local library.

(Taqwa Gad / EyeEm via Getty Images)

19.  Learn a skill that will help you save.

Learn to let out pants, tailor your own skirts, change the oil in your car or fix a stopped up sink. Wisebread has a list of 10 life skills to learn to save money.

(AndreyPopov via Getty Images)

20. Call your insurance agent.

If you have car insurance, homeowner's insurance or renter's insurance, you may be able to lower your deductible, bundle your policies or get rid of coverage you no longer need. Investopedia lists 6 ways to save on insurance.

(mediaphotos via Getty Images)

21. Print, cut, or buy coupons.

Using coupons can help you save on groceries, dining out and other items you buy. Browse sites like RetailMeNot for printable coupons or use TheCouponClippers to purchase cut coupons from the newspaper. Focus on items you are going to buy anyway. You might also visit websites like DealSeekingMom to find out how to get items like toothpaste and toilet paper for free — or close to free.

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22. Unsubscribe from daily deal sites or online websites.

If you are subscribed to a bunch of sites that alert you to sales and bargains, you are more likely to spend on items you don't need. Buy stuff when you decide you need it, not when an online newsletter tells you the item is on sale.

(PeopleImages via Getty Images)

23. Go for a walk instead of watching TV.

You won't waste the electricity on running the TV — and you won't see ads shilling for products. Plus, walking is a healthy and free way to get exercise.

24.  Plan a weekend of free events.

Make a commitment to not spend any money this weekend. Look for free community events to attend — or invite your friends over for a potluck or clothing swap party.

25. Plan your meals for the week.

Meal planning allows you to avoid wasting food since you can make a grocery list and buy only what you need. Lifehacker has a simple guide to meal planning and you can check out Mic's tips for healthy eating on a budget.

26. Cook and store food strategically.

Following your meal plan, make up a few meals you'll eat over the course of the week. You can even make some extra to freeze for when you're in a rush and don't have time to cook or pack a lunch a few days later: Just portion out food in little freezer bags so it'll be easy to thaw individual meals.

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27. Have a no-spend day today.

Make a commitment not to spend even $1 on anything for one whole day. Prep your coffee at home, bring your lunch, bike to work, and eat one of your pre-planned, home-cooked meals for dinner.

28. Automate all of your bill paying ... and saving.

If you are still manually paying your bills each month, set up automation for any accounts you can. This helps you avoid late fees if you get busy or forget. If you have a savings account, set up an automated transfer of at least a few dollars per month so you can make sure you are saving something.

(Rawpixel via Getty Images)

29. Find a cheaper way to commute today.

If you normally Uber, try taking public transportation. If you normally take public transportation, walk or bike to work. If you drive, see if you can arrange a carpool or switch to the bus. Your commute can cost you thousands over your working life.

30. Call HR and ask about workplace benefits.

You should definitely be investing in a 401(k) if your employer offers one. However, you may be eligible for other benefits like corporate discounts on cell phone service or hotel rooms. Find out what benefits are available that you can use to save — you might be surprised (see: "cash in lieu").

(DNY59 via Getty Images)

31. Carry around healthy snacks bought in bulk.

It's not just meals that are a money suck, and hitting the vending machine can add up. Buy some dried fruit, granola bars or trail mix in bulk — and then bag it up into snack-sized portions to help your wallet and your waistline.

(bajker via Getty Images)

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Choosing a mattress

Buying the wrong mattress, or sleeping on the same one for too long, can hurt your health and your productivity. A saggy mattress can cause back and neck problems, including chronic pain. This could lead to costly pain medications, chiropractic visits and even physical therapy or surgery.

If your mattress is so uncomfortable that you can't get a good night's sleep, that can lead to all sorts of other issues, from car accidents to heart attacks, WebMD notes. It can also hurt your ability to concentrate and remember things at work. And that, in turn, can hurt your career.

Don't be put off by sky-high list prices on mattresses. You can often find discounts buy shopping online and checking out sales on Memorial Day, Fourth of July and Labor Day. Check out Mic's guide to buying a mattressso you don't end up with a dud in the bedroom.

Hitting the clothes racks

If you're buying PJs for lazing around the house, going cheap is fine. But when shopping for work clothes or perhaps most importantly shoes, you don't want to just get the absolute cheapest apparel you can find.

Cheap clothes wear out more quickly, so you end up spending more to replace them. This is especially true for shoes, which can also damage your feet if they don't give you the proper support. Runners should pay extra attention to their footwear, as all that pounding on the pavement puts extra force on your feet.

At work, "a few quality outfits can make you look like a go-getter that takes pride in your appearance," LifeHacker notes. That doesn't mean you should waste money on designer brands, just that your clothes shouldn't look shabby.

Check out Mic's guide to buying quality clothes on a budget, then learn how to make them last forever.

Hiring professional help

Whether you're hiring a house cleaner or a financial planner, focusing solely on price is a sure way to get low-quality service. The person you hire might seem like a bargain when they tell you their rate, but they can end up costing you more because they don't do the job right or they tack on surprise fees.

If you're hiring a handy person or cleaner online, always check their reviews and try to independently verify their identity to make sure they are legit. When it comes to licensed professionals like financial planners, be sure to check their credentials and whether there have been any public complaints about them.

Lastly, always check references, because if other people are happy with their work, you probably will be too — even if their fees aren't the cheapest in town.

Sign up for The Payoff — your weekly crash course on how to live your best financial life. Additionally, for all your burning money questions, check out Mic's credit, savings, career, investing and health care hubs for more information — that pays off.

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