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If you have a large variety of development work, than a vps may be worth it. If you need something custom done, it can take you all of a couple minutes, as opposed to sending in a ticket to your hosting company just to see IF it can be done. Major software versions do not update all that often, and if you get something like cPanel on your vps, the minor versions can be upgraded automatically. Or you just have to type something like "yum update".. not really a big deal.
On the other hand, if you need some custom modules compiled in with php or ruby, or libgd ..etc, you have the flexibility to do that.
I pay $35/mo for a basic vps, and then $5/mo on godaddy for one of the "200GB" type deals, which I use basically just for ftp, larger files, and backups
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