Don't be afraid to spend a couple bucks on good quality tools if you need it. Especially hand tools. Stick with name brands whenever possible made in U.S.A. Thank You. Visit http://www.stillmadeinusa.com/tools.html for a list of products and tool manufacturers American based.

Also, buy tools at the right time, ie. when they are on sale.

Sometimes you need a tool urgently, so you just have to bite the bullet and pay whatever the best price is that you can find. But if it is not an emergency, then shop around, you can save so much money when you are getting a good price. Not only that but with the money you save you will be able to then get a better quality tool. Because as LarryG said, by spending a couple of extra bucks on a good quality tool you will get a more durable and useful tool.

Also keep an eye out for online sales. There is so much competition in the tool industry, so the companies are out to make more sales, and they often cut a heap off the standard price. Some companies, like power tools Sydney have a sale page on their site, and I get a lot of tools of them. So have a look around in your local area and see if any of the tool stores there offer online specials.