After tightening their wallets in recent years, many Americans are giving in to the urge to splurge, judging by recent retail sales data.
With the caveat that it's never a good idea to spend money you don't have -- or go into debt for that "retail therapy" -- Jack Otter, executive editor of CBS Moneywatch breaks down what's worth spending the extra money for in his new book, Worth It...Not Worth It?
In the accompanying video, Otter and I discuss several choices millions of Americans encounter in their everyday lives, such as:
Is It Worth Paying More for Organic? Setting aside other issues such as sustainable farming and the 'locovore' movement, Otter says there's a handy rule of thumb when it comes to organic produce: If it has a peel, it's not worth the additional price.
Conversely, the USDA has identified 12 fruits and vegetables that have the most pesticide residue: peaches apples, bell peppers, celery, nectarines, strawberries, cherries, pears, imported grapes, spinach lettuce and potatoes.
When it comes to these "dirty dozen" items, Otter says paying more for organic is well worth the cost.
Pay a Personal Trainer or Work Out Solo? Because most people do what they're comfortable with -- and best at -- Otter says paying a personal trainer is usually well worth the cost.
Personal trainers will help tailor a workout that focuses on the things you really need to work on -- and are probably avoiding -- and can almost always help improve the workouts you're already doing.
In addition, most people who use personal trainers go to the gym more frequently and make better use of their time, Otter says.
On a related note, Otter says you're better off joining a YMCA and paying extra for a personal trainer vs. paying more for a high-end gym with the latest equipment and luxurious locker rooms.
Get a New Car or Take Annual Vacation? It may seem counter intuitive but Otter says going on vacation is a better investment than buying a new car because of something economists call "hedonic adaption.
Just as our eyes adjust quickly to bright sunlight, we quickly get used to the new car, realizes a few things about it that aren't ideal and start fantasizing about another, better vehicle, Otter says. "Whatever you drive home for the dealer will pale in comparison to Jay-Z's Bugatti."
(On a related note, Otter advises buying a used car vs. new -- and buying vs. leasing in most cases.)
Meanwhile, the memories from a (good) vacation typically improve over time and give us psychological benefits that can last for years, he says.
As a result, Otter says an annual vacation holds its value better than a new car -- and not just because of the depreciation when you drive the car off the lot.