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extra RAM all day long. External HD are quite inexpensive, though it all depends on what your day to day needs are. For me my biggest files are generally pictures and music, which I can store on an external drive.
 
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To compound this with a variation I'm torn between m1 MBA 8gb/1TB or 16gb/512gb... Any new thoughts? Thanks.
 
To compound this with a variation I'm torn between m1 MBA 8gb/1TB or 16gb/512gb... Any new thoughts? Thanks.
I'd go with 16/512 for the reasons others have stated but, honestly, it depends on how much RAM and storage you need for your usage. Nobody can really tell you that unless you go into detail about what you do (even "Photoshop" or "Safari tabs" can depend on what exactly you're doing with them).

What RAM and storage do you have on your current machine? Is it struggling (storage should be obvious, for RAM you need to look at Memory Pressure in Activity Monitor, not Memory Used)? ...because switching to M1 isn't necessarily going to significantly change those requirements. Yes, the M1 may deal with a RAM shortage & swapping to SSD more efficiently than Intel, but it will still be running slower than it could with more RAM).

Likewise, storage - 512GB will be perfectly liveable for most people and - as has been said - it's easier to augment the internal storage with an external drive or cloud/NAS storage than it is to deal with a RAM shortage... but if you have half a TB of data or media that you need at your fingertips "on the road" it is far more convenient to have it internally - and you might not need more than 8GB RAM to view/browse it.

It may be that you only need 8GB/512GB (especially if you've figured out how to use bookmarks in Safari rather than leaving a dozen ad-laden tabs open) and can save a few hundred bucks.
 
I now have a M1 Air 16/512. I always have 4 browsers with 70-80 tabs open, plus some programs. Zwift also runs more often. MacOS fills the ram until it is full. In my opinion 16 GB is the minimum for such a powerful Macbook with which you can do pretty much anything.
 
I bought the 8 GB/512GB MacBook Air yesterday. I always wanted more storage than anything. I still have my 16 GB 1 TB MacBook Pro 16 inch but it truly was overkill for my uses. I only bought the 16 inch 1 TB model for the 1 TB storage. I have opened three browsers on my MacBook air with 15 tabs open on each one and it's handling it just beautifully just as the 16" did. That's probably the most extreme thing that I will do on this MacBook Air.
 
RAM has always been the thing that improves the computing experience, and I can't imagine that's any different with the M1. As for storage - realistically, how much do your really need on your MacBook as a 'daily driver'? Do you routinely load your computer up with absolutely every app that catches your fancy and every digital file you've ever accumulated or created since you first started computing?
Heck, I've got 256GB and I have files (including 1300 tunes, 30 vids/movies, over 1600 photos and 8000 docs /PDFs) on here - some of which I haven't touched this year - and still I have 135GB free. Stuff I use even less often (and a manual backup) I have on a very compact portable external drive.

And let's not forget Apple's own efforts to get us to do our computing storage via iCloud.

That said, whatever you do, bear in mind your computer will be 'so last year', well, next year - and its the internal guts of the thing (the thing we can't easily upgrade) that will dictate how useful it will be to you and how long Apple will support it. There is no 'future-proofing' in that regard...
 
I've had both the 8GB and 16GB models, and wound up giving the 8GB to my SO so I could buy the 16GB. Go for the additional RAM; it does make a difference.
 
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