Question:
I read on your site an article that suggested buying the best Chanukah menorah one can afford. I have a menorah, it is gold-plated, made in Jerusalem, and cost about $50. To buy anything better, anything more expensive, would have seemed self-indulgent; who would benefit but my own family and the shopkeeper? Surely it is better to give charity to those in trouble than to buy an expensive menorah for one's own family's enjoyment? Should our hearts not be for the poor?
Answer:
You are correct that giving charity is an extremely important mitzvah—in fact in many ways it is incomparable to any other mitzvah (see Why is charity considered the greatest mitzvah?). That is why the Torah obligates us to give maaser, at least 10% of our earnings to charity or charitable institutions. Someone who is even more charitable is recommended to give up to 20% of his earnings.
But this leaves 80% of our earnings for ourselves, and let's face it, most of our purchases are indulging our wants and desires (besides for our basic needs). From this money, Torah says, don't only spend on what thrills you, show that you love G‑d too, and love the precepts that He gives to you. The way we do that is by glorifying the beauty of the things that He has commanded us. Showing how precious the mitzvot are to us, by being willing to buy the best that you can afford, demonstrates that not only do you follow G‑d's will, but you appreciate it and are thankful that He chose you to whom to give the mitzvot.
Chana Weisberg for Chabad.org

Re: Anonymous from Ramstein, Germany Absolutely that counts as tzedakah! You are a credit to the Jewish people and all humankind. In fact, the Torah considers you to have saved human lives, and not just for the ones who were sick. I learned from Rashi that one who loses his possessions is considered dead, and from the negative, we can infer the positive. In other words, one who restores possessions to another, or brings him back to a previous state of wealth has effectively given life to him. Finding lost family is also considered equal to saving lives, because when we see someone after more than 12 months without contact, we say the blessing "...Who enlivens the dead." In addition, the Talmud teaches that giving to needy Gentiles has an additional benefit of increasing peace between Israel and world. May G-d Almighty bless you, and increase your ability to give with both material and spiritual blessing!