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الخميس، 27 أكتوبر 2016

31 Days to Financial Independence (Day 11): Trimming Your Spending – Food

“31 Days to Financial Independence” is an ongoing series that appears every Thursday on The Simple Dollar. You might want to start this series from the beginning!

Last time, we started looking at the average American family budget, going through each category and examining how one could trim the cost of typical expenses in that category. Here’s the “average American family budget” that we’re looking at, along with links back to the earlier entries on those specific areas:

Housing – $10,080
Transportation – $9,004
Taxes – $7,432
Utilities – $7,068
Food – $6,602
Insurance (including things like pensions) – $5,528
Debt Payments – $5,252
Healthcare – $3,631
Entertainment – $2,564
Cash Contributions – $1,834
Apparel and Services – $1,604
Education – $1,138
Vices – $775
Miscellaneous – $664
Personal Care – $608
TOTAL – $63,784

Today, we’re going to take a look at food spending. As you can see from the budget above, the average American family spends $6,602 per year on food. That averages out to $550 per month. Remember, however, that this “average American family” includes single adults, married couples without children, and families with children, too. In other words, a single person is probably coming in below that, whereas a large family (like ours) is probably coming in above that.

The thing is, food is a budgetary area that’s extremely easy to cut back on without reducing the quantity of calories consumed or the quality of food. There are many, many things you can do to trim the cost of food.

Exercise #11 – Trim Your Food Spending

The rest of this article consists of a long list of specific tactics that you can use to trim your food costs. As with the other savings articles in this series, it’s important to remember that everyone lives a somewhat different life and thus some of these tactics are going to seem useful and sensible to you, while others will seem like a stretch to you, and still others won’t apply at all. That’s okay. Ignore the ones that don’t apply. Make an effort to adopt the most sensible ones. Then, give the others a trial run and see if it’s something that can work for you. Commit to some of the challenging ones for thirty days and see if they work, or apply them during the relatively rare situations when those costs come up.

Remember, your overall goal is to cut back hard on the areas of life that are less important to you – the shallows – so that you can afford the “deep” areas of your life both today and tomorrow. Keep that in mind as you read each tip. Is this tip cutting back on something that’s really important to me, that amounts to a core life value? If not, why not cut it so that I can afford those things that really matter?

Let’s dig in.

Make weekly meal plans based on the grocery store flyer before you go to the store. Just sit down with a piece of paper or a whiteboard or a blank document on your computer or phone and list out all of the meals you and your family will eat in the next seven days, then start filling in the blanks. You know that your family is going to have to eat supper next Monday – what will that be? What will everyone have for breakfast next Wednesday? With the aid of your calendar and the knowledge of how a typical week goes, you can start making those decisions now.

It’s a very good idea to go through this process with the aid of the weekly grocery store flyer from your preferred grocer (more on that in a bit). Use the ingredients on that flyer to plan your meals. That way, you know that when you buy the ingredients for that meal, you’re naturally going to be buying ingredients that are on sale at the store.

This saves money in a number of ways. For starters, it allows you to think in advance about your meal plans so that you’re not stuck making last-minute decisions about your meals. Last-minute decisions almost always wind up being expensive decisions. Second, you’re taking advantage of sales by incorporating the grocery store flyer. Third, by planning ahead, you’re more likely to choose meals made at home, which are substantially less expensive than meals eaten out.

Make a grocery list based on those meal plans and your actual needs at home. Once you have that meal plan, turn it into a grocery list. Look around your home for the elements of that meal plan that you already have and only add things to your list that you don’t have – ideally, just fresh ingredients and whatever perishable items you’re running low on.

This process of going through the items you have on hand to figure out which ones you actually need almost always results in a shorter grocery list than you might have expected. Occasionally, it might result in a minor change to your meal plan – “oh, hey, look, I have some instant oats in the cupboard, so I’ll just have that for breakfast on Wednesday” – that also causes your grocery list to be shorter.

The shorter your grocery list, the better. A short grocery list means an emptier cart at the store and a smaller bill at the checkout aisle, which means more money stays in your checking account.

Shop for groceries based on that trusted list. The next step is to head out to the grocery store with that list in hand and buy all of the ingredients you need. Since you planned that list based on a meal plan that was itself based on the grocery flyer, many of the things on your list are going to be on sale already. Couple that with the fact that you filtered the list based on what you have on hand and that list should be tight – it’ll have just things that you need and many will be on sale. That’s a list that’s going to save you money.

Not only that, having a list in your hand in the grocery store means that there’s no need to wander the aisles at all. You know what you need, so you just walk from item to item on the list, putting them in your cart and moving on as efficiently as possible. When you’re focused on that list, you’re much less likely to have your attention wander, and when your attention wanders in a grocery store, you wind up with unintended purchases in your cart.

A tightly focused grocery list gets you in and out of the grocery store as fast as possible with a minimum number of items in the cart. Not only will that save you a lot of money on your food purchases, it also recovers the time invested in preparing the meal plan and grocery list.

Settle on a regular discount grocery store that you trust. Of course, even the best grocery list strategy won’t save you a lot of money if you’re paying a premium price for everything in the store. The best approach to take when it comes to grocery shopping is to make a discount grocer your primary grocery store.

What’s a “discount grocer”? It’s simply a grocery store where the focus is on low prices on the shelves. Usually, such stores are organized and arranged very simply without a lot of extra amenities. Some examples of this include Fareway (my grocery store chain of choice), Aldi, and Trader Joe’s.

The advantage of using a store where the prices are normally quite low is that, no matter what’s on your list, you’re going to be paying less than you would at a typical grocery store. It’s almost like going to a normal grocery store only to find that literally everything is on sale.

Eat out less. Naturally, the idea behind such a focused grocery store strategy is that you’re going to be eating lots of meals at home. In truth, that’s the core of saving money on food – eating at home.

No matter how you slice it, eating out or getting food delivered or picking up ready-made meals is going to be far more expensive than making comparable meals at home. That’s because you’re paying those restaurants for the labor of actually preparing your food and delivering it to you. If you cook at home, you save that cost.

Isn’t eating out more convenient, though? Even if you’re eating at a fast food drive-thru, you’re still waiting in line, ordering food, waiting for the food to be prepared, and paying for it, which does add up. Eating out isn’t instantaneous and often has a similar time commitment to a fairly quick meal at home. That leads us to the next strategy…

Learn how to prepare a number of well-loved meals quickly and efficiently. If you have a repertoire of ten or so meals that you like and that your family likes, particularly when those meals can easily be varied to provide different flavors and textures, and you can prepare those meals quickly and with minimal effort and cleanup, you have little reason to eat out very often.

The trick, of course, is reaching the point where you can prepare meals you enjoy quickly and with minimal effort and cleanup. That only comes with practice. The more you prepare your favorite meals, the more efficient you become at every aspect of the preparation (and you also improve your efficiency at other meals).

This takes time, but it’s an investment of time that really pays off. Your first meals will be slow and messy and perhaps not perfect, but you will improve with each attempt until the process becomes second nature. At that point, preparing meals at home often seems like the most sensible choice.

Rely on low cost staple foods as much as possible. Some recipes are simply more expensive to prepare than others because of the cost of the core ingredients in that recipe. A meal that’s centered around a perfect steak, for example, is going to have a premium cost.

One great strategy for keeping average meal costs low is to fill most of your meal plan with meals that are centered around low cost staple foods. Dry beans, dry rice, chicken, peanut butter, eggs, cottage cheese – all of those things are inexpensive staples around which you can center a lot of different meals.

Make those low cost staples the centerpiece of a lot of meals and you’ll save a lot of money. You can buy the dry ingredients, like beans and rice, in bulk because they become even cheaper and they’ll last forever.

Use a slow cooker. A slow cooker is an amazing device. You can simply put a handful of ingredients in the slow cooker in the morning, hit a button or two, and then walk in the door after work to a delicious home-cooked meal that’s ready to put directly on the table. It’s absolutely perfect for busy families like ours; in fact, we use ours two or three times a week to allow for homecooked meals in situations where time constraints might force us to pick up food or get takeout.

Slow cookers excel at things like soups, stews, and casseroles – things that work really well when cooked slowly over several hours. Most of those meals, particularly soups, amount to literally adding ingredients to the cooker in the morning, turning on the heat, and enjoying it in the evening. It’s about as easy as can be.

Another great use for a slow cooker is for making broth or stock. Just save your bones and other scraps from meats and any vegetable scraps you might have and boil them together. A pot full of chicken bones and vegetable scraps, filled up with water and left to slow cook all day, turns into a wonderful broth that can be strained and saved for future soups and other meals.

Prepare multiple batches of meals and freeze them. If you’re already making a casserole or soup or stew for dinner, why not make two or three batches of the same thing and freeze the extra batches for later use? Doing so adds only a little work if you’re already preparing a meal.

Another strategy is to prepare a full second batch, cook it at the same time, and then divide it into individual meals for reheating. A pan of lasagna, for example, can be split into twelve individual pieces which, when placed in individual freezer containers, can provide many lunches going forward. A well-stocked freezer provides lots of meals that are ready to be pulled out and thawed in the refrigerator. These meals can then easily be heated at your convenience in the next few days.

The big advantage here is that it allows you to buy ingredients in bulk when it might not otherwise make sense to do so. If you’re making lasagna because the ingredients are on sale, for example, you can make a “cheap” pan by buying double the ingredients. Similarly, if you can get a much cheaper price per noodle on a jumbo box of lasagna noodles, making multiple pans at once can be a real money saving proposition.

Drink water instead of soda or other beverages. Water is an extremely inexpensive beverage, and it serves its key purpose incredibly effectively. It quenches your thirst. It hydrates you. It has zero calories. It’s also incredibly convenient and pretty much free.

Virtually every other beverage out there fails in at least one of those areas. Almost everything is more expensive than a cup of water, the cost of which is substantially less than a penny if poured from your tap. Many beverages fail to hydrate you. Many beverages are loaded with calories. Many beverages actually don’t quench your thirst at all.

Make water your main beverage. Not only will you feel better, you’ll also save yourself quite a bit of money along the way.

Buy nonperishable foods in bulk when they’re on sale. I touched on this idea above a few times, but it really deserves to be said on its own. If there are nonperishable foods that you use regularly in your meals, buy them in enormous bulk. Fill up your cupboards with rice if you use rice in a lot of meals. Fill up your cupboards with dry beans if you use dry beans all the time.

When you buy nonperishables in large bulk, you drive the price per pound down as low as you possibly can. Buying a twenty pound bag of dried beans, for instance, often reduces the price per pound for beans to about 60% of the cost of buying a pound by itself. If you’re going to use those beans, that’s a tremendous bargain – basically, the first twelve pounds cost you the same per pound as the one-pound bags, but the next eight pounds are free.

Look at the nonperishable foods you use all the time in the kitchen and then look into the possibility of buying those items in large bulk through warehouse clubs or other opportunities. You’ll likely end up saving a whole lot of money.

Buy dried beans and rice and prepare them in advance when it’s convenient. One reason that people rely on the convenience of precooked canned beans or on instant rice is because of the time involved in preparing dried rice and dried beans. When you’re trying to prepare a meal with beans in it, for example, waiting for beans to cook can just stretch out meal preparation too far.

The solution is surprisingly simple: just cook the rice or beans a day or two earlier and store them in the refrigerator. Let’s say you need some cooked beans for a chili soup in the next few days. Cook the beans now when you have some time. Bring them to a boil on the stovetop and let them sit in the hot water for an hour or two, then drain the beans and put them in the fridge. Boom – it’s actually easier at that point than using canned beans!

Every time you can take an element of a meal and prepare it earlier, do so. This makes the actual meal preparation even easier, and when meal preparation is easy, you’re more likely to do it instead of going out and spending more money on food.

Next time, we’ll take a look at how to save money on insurance.

The post 31 Days to Financial Independence (Day 11): Trimming Your Spending – Food appeared first on The Simple Dollar.



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