Buying a device with way more memory than needed is a waste. If you need it, buy it. I stuck with the 512GB 11" iPad as I was only using about 375GB on my previous device. Room to grow.
Ah, man! Now I have to go through my want/need speech!
I disagree that it's a waste because I purchase based on want. 99% of the time my purchase also meets need, but when it comes to iPhones I always buy the max storage available.
This is one of the reasons I tend to stay on a phone for 3.5 or more years. Usually the max storage is really expensive.
If I waited until I had a need for everything I went out and got, I would never get anything I actually wanted.
Purely from a use/cost benefit analysis, yes you're right. But generally other factors come in to play for me when buying. You can't put those in the analysis because it doesn't make any sense; how do you quantify want?
If I had to justify every purchase I made based on need, I'd be screwed.

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Is the capacity of an Apple device more important to you than the generation of the device? I would have stayed with the iPhone X 256GB but when I saw that Apple released the iPhone XS 512GB, I said I would like to have that despite the similarity of the previous generations. The larger capacity many times draws me in. That said the new iPad Pro 11 inch with 1TB seems awesome, but I already have the iPad Pro 10.5 512GB and that was costly so I'm going to stick with the 10.5 inch for a while. I'm actually hoping for an OLED option eventually.
With iPhones capacity trumps model, except if I already have the max capacity of my current model and can't afford the next model (yet).
I always get the max storage offered. I don't usually need it, but as I've explained above I don't buy based on need.
When it comes to iPads though, capacity (or model) is less important to me.
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I use to think that the biggest capacity was always the right choice.
The right choice is always what you want - or what works best for you. Sometimes it's even what you need.