Sushi Money

Here’s my list for how we save money at home. It’s an ever-changing process, and I continue to look for ways to maximize value, and minimize expense. Perhaps it’s a lifestyle choice as well. But if we save $10 a week, or $40 a month, or close to $500 a year by making good choices? That $500 invested (one time) and earning a meager 7% over 20 years adds up to over $2000… saving $40 a month for 20 years is $21,240!  At 10% interest, that one-time $500 grows to more than $3600, and saving $40 per month grows to over $32,000!  Imagine making wise choices that save you $100 per month or $1200 per year. Over 20 years, saving $1200 per year, at 7% that money compounds to over $52,000. And with a 10% return, an initial one-time $1200 investment will return almost $9000 for retirement needs, or $76,000 if saving $1200 each year! It’s amazing how money can add up… and that’s why everybody wants your pennies. I once read an article where the author debated whether picking up pennies when you saw them was worth the effort, with the conclusion that it really wasn’t. I disagree… not so much because the pennies add up to any tangible savings, but more importantly for the mindset. I believe it’s the little things that count… a mindset of abundance, and of respecting and valuing how money can serve a purpose that will foster effective choices throughout our lives. Money is a tool… and I hope to have enough tools in the bag during my life to take care of needs as well as allowing more choices over time.

1. Shopping for groceries: Shop when you are not hungry! It really works… if you’re not hungry, many foods and grocery items will simply not be as appealing at the moment. You are more likely to buy only what you need. Don’t stock up on groceries “just because” but have a good reason to do so. I like nothing better than a full pantry, but how often do we go rumaging around for something while we wonder why so many cans and jars go unused? They may eventually be used, but that’s just money sitting in there… kind of like stuffing money in the mattress while earning no interest. I think a balance can be found between essentials and necessary items, and other more common food items. Now I will also say that if I lived on the southern coastal areas during hurricane season, I might stock up on more essential items… especially water and canned goods. For some people, the security of having food in the house ready to use outweighs any misgivings about buying too much at one time. We clip coupons… sometimes. We try to buy only what we need, and use the coupons that serve the same purpose.

2. Costco and Wal-Mart: I love to shop at the big-box stores as a primary money-saving method, but I also like to see the diversity of products they have each week. Costco especially can provide some excellent deals on groceries and bulk foods. They don’t have everything, but what they do have is usually at a pretty decent price. The problem with Costco and the Super Wal-Mart centers, Sam’s Club, etc, is that you can get in the habit of buying too much, and buying things on impulse because it looks like such a great buy. Often it is just that- great prices, but you may not need it. If you are going to shop at these stores, it is best to do so carefully. Make a list of what you need and want, and stick to it. How many times have we bought things on impulse and later wondered why we did so? But Costco is a favorite of mine- where else can you get an extra-large roasted chicken for $4.99? The Costco chickens tend to be larger than the typical roasted chickens at the grocery stores. If you find things you use frequently like condiments, bathroom supplies and shampoo, vitamins, paper towels, various vegetables, and pet food, Costco can offer excellent prices. I don’t shop at Sam’s Club, but I imagine they have similar deals and price levels. If you shop wisely, you can save a lot of money over time.

3. Auto fuel and service: When do you fill up your car? Almost on empty? At a quarter tank? A half tank? Again, if I lived in an area prone to storms or fuel shortages, I might fill up more frequently. But I try to use the fuel in the car, at least towards a quarter tank, for two reasons. The first is that if I’m always “topping off” then there is some degree of older fuel that is always in the car, slowly aging with the blend of the new fuel. With today’s ethanol blends, I think it’s important to use more of the fuel rather than let it age, and potentially develop water in the tank, etc. The second reason is that storing fuel in the tank repeatedly is like keeping money in the mattress again… it never gets spent. I paid for the fuel- so I should probably use it… then buy more when I need it. But honestly, I do go back and forth- depending on fuel prices. I tend to use much more of the tank when prices are lower or stable. When prices are rising, I’ve noticed I tend to top off more often. By the way, Costco has terrific prices on tires, as does Wal-Mart. Costco runs sales quarterly on Michelin and other top brands where you can save $60 off a set of four tires. Plus they will service and rotate them for life! For oil changes, I’m a Jiffy Lube fan. Similar stores offer decent prices as well, but you can get a complete oil change for between $19 to $25 dollars, sometimes lower with coupons. I used to change my own oil, but it’s messy and doesn’t save much money anymore, especially as contrasted with the time you spend doing it. But don’t let them do anything else to your car unless you really need it, because that’s where the costs add up. If you need an air cleaner- get it yourself at the parts store or Wal-Mart. Windshield wipers at Wal-Mart. Change light bulbs yourself… my wife once paid $10 to have a license plate lightbulb replaced. For an .89 cent lightbulb!

4. Dining out on fast food: There are obviously tons of choices and preferences in the fast food arena. I try to minimize how often I eat fast food in the first place, both for health reasons and cost. Value meals aren’t cheap- heck, a whole roasted chicken costs as much, or less, than a typical value meal! But we still go out for fast food… let’s face it, it’s fun! Yet I’ve found I can choose wisely and save money. At McDonalds for example, you can choose a “Big and Tasty” for $1.00 and a “Hugo” large drink for .89 cents. Leave off the mayonnaise and you save tons of calories. I don’t need the french fries health wise, so that’s an economical meal. The “Big and Tasty” is a decent burger, when you compare a hamburger at Sonic is $2.39! Once upon a time Sonic offered three hamburgers for a dollar on special in small towns across the midwest. No more… now they’re expensive. Hardees also offers regular burgers for .89 cents, although they are smaller. Burger Kind too. Taco Bell offers some great prices on their value meals and $1.00 menu items. I gave up on KFC years ago because the prices were too high for the quality of food, but lately they have reinvented their menus and the prices are much better. And who doesn’t love Pizza? One of our favorites is Papa Murphy’s. It’s “take-and-bake” but excellent pizza at great prices. You can usually get an enormous cheese pizza for around $8 and then add meat, veggies, onions and more at home. We usually only eat pizza when the prices are right, and even Costco has decent pizza at an excellent price.

5. Bag lunch for the kids! Eating at school can be pretty expensive over time, and probably not as healthy. I try to explain to the young one that when we save money by fixing lunches at home, we can use that money for other things for the family… a movie now and then, McDonald’s Happy Meals at times, etc. I believe allowing the kids to understand the contrasts between prices and behaviors will help them learn about money, and about making wise choices. With their allowance, if they want to spend some at school, then that’s fine. But I try to monitor the spending there as well.

6. Banking: If you’re paying fees for checking and savings, then you should find a new bank. Loyalty is fine, but don’t stay with your current bank because it seems burdensome to make the change. It may take a few signatures, but you can change your direct deposit and allotments very easily. Banks are competing for your business- and there are many choices available that offer free services these days. I don’t allow them to nickel and dime me at every turn either- if there’s a fee for something, I call and question it. Many of the larger banks will refund the money if it’s an uncommon charge. We also pay bills online primarily. Saves time and money and works just fine.

7. Cell phone and internet use: Do you really need the number of minutes you pay for? If so, then great. What about all the neat services, ring-tones, web access, etc? Those services really add up in cost, and if you’re not using them, then get rid of them! We have a “family plan” at the minimum level, and barely use our minutes. Our plan is up next month, and it may be time to shop for individual plans at a lower price. We live about 45 minutes outside a metropolitan area, and there’s only a few plans that have decent coverage here, so our choices are limited. But between internet access, land-line telephone and cell phone plans, the costs really add up. We don’t use the latest and greatest phones, but they work just fine.

8. Cable TV: I used to be a cable TV addict… surfed like a pro and loved the choices. We moved here and had the opportunity to get satellite TV. We put up a roof antenna instead and get about 7 different channels- all the major networks including PBS. That saves us from $45 to $70 per month based on what we were paying before. And you know what? I don’t really miss it… and heck, I don’t have time to watch a lot of TV anyway. Well, okay- I miss some of the sports networks and news programs! But I’d rather have the savings.

9. Energy Costs: I think this is a huge area where many can see savings over the year. I love to be comfortable in winter and summer… but I am also constantly monitoring our energy usage. We use electric, propane, wood and pellets. The electric is the mainstay of our energy usage. Both electric and propane are controlled by 7-day programmable thermostats. I prefer the Hunter-Douglas brands. These systems will allow you 4 daily settings, and can be manually changed quite easily, just bumping the temperature up and down. But our energy saving mode is primarily at night. The thermostat automatically turns the heat way down in winter, or keeps the a/c set much higher in summer. We save hundreds of dollars each year because of these two $60 dollar thermostats. For propane especially, I turn the system way down in winter. When it’s cooler- we wear a sweatshirt. When it’s warmer, wear a t-shirt. We don’t skimp or live uncomfortably, but we work to use energy wisely. I refill the propane tank in late spring or summer when the costs are typically lowest. We also use many flourescent energy-saving bulbs throughout the house, and try to keep lights always turned off when not in use. I turn the computers off at night also… have been doing so for over 10 years with various brands and they work just fine. I’m sure many of these are common habits for most people, but I was surprised that many others don’t give it a thought. We had neighbors a while back that lived in a 4200+ square foot two-story house. Each floor of their house had the old-fashioned “dial” thermostats with no programmable functions. They left it on a comfortable setting day in, day out, whether they were there or not. They would be gone for several days on trips and their air conditioning would be running constantly. Well, it’s their house and income, more power to them… literally.

10. Mutual funds and Stock trading: Find a good discount broker if you’re going to trade as a hobby! Those costs add up to incredible amounts of money over time. Scottrade is my favorite discount broker- just there for the times I want to make a quick trade, which is not very often. I’m a buy-and-hold long-term kind of guy. The fees and charges can really add up with brokers and mutual fund holders. Do you know your mutual fund’s expense ratios? Have you compared them to other funds or institutions? Vanguard is my favorite… my current total expense ratio at Vanguard is less than 0.6%. Not hard to do because their costs are very low compared to the averages. But you may have a preferred institution or fund. You can still hold many of those through a low-cost company like Vanguard, and you can transfer them there as well. DRIP investing is a good method that many use to own dividend-paying stocks at low cost. But the administrative headache can be burdensome over time. I prefer a single good broker to hold, and reinvest, my dividends from stock holdings. Scottrade doesn’t typically reinvest dividends, so I don’t use them for that.

Many other ways to save money… I try to look for them each day. What other things do you do? The list could go on and on… I think it’s both a challenge, and I enjoy being more frugal at times. We don’t always succeed, but have a budget that seems to work. And with the cost of fuel prices, we probably will be doing more things at home!

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