Money Saved, Money Earned!
Many Americans can save nearly $500 per year in ATM fees, by using their Bank's ATM instead of the closest machine, or changing banks to one that has the closest ATM machine. Yearly savings - $475.
Too many Americans flush an average of $520 to $1,040 dollars a year down the toilet on lottery tickets. Participants have a higher chance of getting hit by lightning than winning the big one. Yearly savings - $520.
Caffeine drinkers spend an average $385 per year on gourmet coffee. Subtract the price of brewing a fresh pot at home in the morning and taking it along in a thermos, can produce an average saving of $225 per year, just on the coffee. If you drive to coffee fix trough, the savings can be considerably more. Yearly savings - $225.
Cigarettes consume for many as about $280 per month, or $3,360 per year. They could save another 20 to $40 per month on health insurance premiums if they quit. Can't quit? Cut your smoking in half, and you harvest more than $1600 per year in savings. Yearly savings - $3500 per year, plus perhaps an extra couple years of life to enjoy those savings.
A whopping $2,857 per year is spent by the average household on infomercial impulse buying. A minimum of another $2,000 per year is spent at the grocer and other stores on impulse purchases the buyer never had in mind when leaving home. The infomercial industry brings in $400 billion dollars per year. Going shopping? Make a list, and buy only what is on your list. This one simple act can pay for next year's vacation to the Bahama's with savings of nearly $5,000 per year. Yearly savings - $4,857.
Brand names cost consumer households an average of up to $75 more per month over generic brands with comparable ingredients and quality except for packaging. In the grocery, the generics are either on the bottom or top shelf, requiring the consumer to reach over their head or bend over for the savings. Is a reach or bend worth $900 per year in savings? Yearly savings - $900.
Restaurants. With an average of $28.47 per restaurant meal, and an average of 82 restaurant visits during the year, eat outers spent an average of $2,341 last year. Cut your eating out down to once per week, and you save $740 per year. Eat out only twice per month and the savings jump to $1480 per year. Yearly savings - $1480.
If you are a regular bar hopper, you may not have noticed that you spend an average of $42.27 per bar hopping night. If you go bar hopping twice per month, you are spending more than $1000 per year on hangovers or DUI chicken with the police. Make it once per month, and save $500 per year as insurance for that DUI fine and fees. Yearly savings - $500.
So, what's the potential grand total of savings for the average habitual consumer? Would you believe $12,457 per year? Add it up.
For those kind of savings you could fly to the Mediterranean Riviera once a year for vacation. And all it cost you was awareness of your consumer activity and the exercise of some self-control in reshaping your purchasing habits. For many part time workers, $12,457 per year is more than they make on their part time job for the year. Why work a part time job when you can earn more as a better disciplined consumer?
Can you think of other ways you and others can save consumer dollars lost on bad habit purchasing? We would love to hear them.
Comments Section
6 Comments
I'd rather spend it on booze and cigarettes than the Riviera.
One man's waste is another man's treasure.
Greg, if it's a conscious choice, instead of an habituated one, then you obviously can afford those choices, and are free to make them.
The point of the article was to highlight only some of the myriad habituated spending choices we make, that either get us into budgetary problems, or, fail to bring to us the value and reward the spending costs.
When I went to Starbuck's for the first time, a few years ago, and ordered one of their Teas, I was floored by how good it was. In ensuing months, I bought at least one per week. But, after 3 months, I was not getting anywhere near the fulfillment value from the drink, that I got when the first time I bought it. I now order it about twice a year, and it remains worth every penny, and special.
I cut my smoking in half by this simple exercise. I monitored which cigarettes produced the greatest satisfaction during my day, and in what situations and what times of day. I quickly, in weeks, was able to reduce my smoking in half, and satisfaction doubled, but sticking to that smoking schedule that was most satisfying.
Becoming conscious about our consumption, and making rational choices about that consumption, was the point of the article, to both increase prudence and satisfaction, for the dollar earned, which coincides with the thrust of your comment. Your comment obviously stems from a conscious and rational choice among many. And that is what Americans could improve on, enormously, being the most copious and conspicuous consumers on the planet, that we are.
I was being a bit facetious, but everything is a choice. I actually don't smoke or drink, except on rare ocassions. I don't have much interest in the French Riviera, either.
I've lived very spartanly at periods in my life, and I've lived more extravagantly. Most people today struggle with having enough expendible income to save for long term goals. I think that is less about extravagance and more about our particular form of capitalism. I'm currently reading an economics book that takes a different tilt towards capitalism and the varieties of what generate wealthy societies and impoverished societies. The economic system has much more to do with wealth than the indivual spending habits of individuals.
That said, your point is well taken that within the reality of an individual's economic status, one has to make choices that will most likely lead to one's personal happiness.
Greg,
The single best rule ever invented for individuals in modern economies is this: "Do what you must to set aside savings equal to 6 months of your daily financial needs and requirements."
This article is for those who have not yet, but, choose to, heed this greatest and wisest bits of advice on how to achieve financial security, regardless of one's income, provided one has an income. It is the most important foundation and first step to all financial security, and applies equally in principle to both business and personal finance.
Money has never brought me happiness. But, money has, in my life, stayed off misery, preoccupation, and the consequential loss of freedom that such preoccupation entails. There is no greater loss of freedom than that which attends poverty, and dictates one's daily survival activities. Far, far too many Americans fail to comprehend this relationship between means and freedom.
One does not need wealth to be free. But, one cannot remain free in poverty, unless suicide by degrees is one's free choice.
Totally agree, but again, wealth is largely a function of the economic system one lives in. If I were in Bangladesh, odds are the only way I could save money is to skip eating.
The book I'm reading points out that a Swiss bus driver makes about 50 times what a bus driver in India makes. Is it because the Swiss driver is 50 times better? Unless Americans learn this basic economic fact, we are heading closer to Bangladesh than Switzerland.
Point well taken, Greg. There is merit to the argument of meritocracy, but, it is limited and relative to a host of other variables, and equality of opportunity cannot rest upon merit alone, or, great injustice will result. This is something conservatives in general fail to fathom or, choose to discount as interference with their ideology of greed is good, and the are entitled to being more handsomely rewarded.
Of course, liberal politicians are not exempt from this ideology, either where there campaign funds from incorporated entities and wealthy donors are concerned.