When to use varchar(max) in sql server?

When length is greater than 4000 character then it is recommended to use varchar(max) because from storage prespective there is no difference between varchar(max) and fixed lenght varchar(n) when n > 4000.In both the cases when length exceeds more than 4000 data row is replaced with a pointer to a seprate page. So it is recommended to store data as varchar(max) for larger values.