As Warren Buffett has rightly said "Price is what you pay, value is what you get." This statement in my opinion accurately defines the very important difference between price and value. There can often be confusion between the price one pays for something and what that thing is worth.
Suppose you are going to buy a smartphone and the price tag looks very big, but does that mean it is the best choice for you? Usually, the more affordable version will give exactly the same that the really expensive phone does. The price explains just how much you are going to pay, while the value depicts what precisely this money is bringing home for you.
Just take a cup of coffee for example, you might pay more at a nice cafe compared to the coffee shop down the street, but if that premium cup of coffee serves up a distinctive flavor or a comfortable ambiance in which you can read the paper, then the higher price could be well worth it. In these cases, the value is less about the price and more about the experience.
This is the same with investments. If you are going to buy a share in a company, you are going to pay a certain price for that stock. The real question is if it's a good investment. It would seem very expensive, but if the company's growing and creating value, then the price would be well worth it over time. The fact that it's an expensive investment doesn't mean it's a worthy investment.
Also let's say you are hiring a professional to do some serious work for you. It's possible that they will be more expensive than most others, but if their quality is really top notch and they help you reach your goals, it might turn out that you get a better value for their higher price.
In so many areas of life, what carries the highest price usually does not represent necessarily, the best value. What you get in return really matters. Countless situations exist where that little extra spent will prove good value.
So when you're spending money or making an investment, remember that it's not just about the price, it's also about what you get out of it. Value is the bottom line.