This has been the worst year ever in terms of my spending habits. No joke. I have been one profligate bastard in 2017 and I don’t really know why. The amount of money that I have wasted is unreal and as the title of this post suggests, one of the main culprits has been groceries. I have been spending over $500 a month on average just on grocery shopping and that doesn’t include me going out to eat or having food delivered! This is literally thousands of dollars down the drain on something that I could have completely controlled, already knew all about how to save on, and was utterly unnecessary. So, this is going to serve as an autopsy of sorts (RIP my money), and zero in on how I’ve already switched things up and plan on cutting spending even further to help right the ship.
If I were to stick with the metaphor of being the captain of a financial ship, I have been drunk behind the wheel for the entirety of 2017. Yes, my grocery bill is crazy high, but I’ve also spent inordinate amounts on: going to events, to bars, vacations, random entertainment purchases, and pretty much anything else completely stupid such as taking Lyft instead of driving (which would mean me not spending money on alcohol as well). Sure, my social life has been pretty cool, and I’ve had some great times in and out of town but this is a disaster.
I haven’t been depressed or been completely slacking off in my work and my other passive income projects. I haven’t achieved any of my goals in those areas either but I never ignored them entirely. 2017 has just been one giant apathetic malaise, with me just chugging along not giving 100% effort to anything, but dabbling in everything.
This all ended earlier this week, where I found myself at a social gathering, and the thought of “Why am I here, exactly?” arose. It went further with, “Do you even like any of these people?” and “You’ve wasted about $60 tonight for no good reason.” In a way, this was positive, because it snapped me out of this year long lack of focus and wastefulness.
Enter the Grocery Store
The day before that gathering, I had inklings of a changing mood, when I actually attempted to buy less and save money while shopping. I have not used a budget (clearly) at all in the past year. Also, I’ve had no clue as to how much I was spending each month, as I’d simply see my Amex bill and pay them whatever it said.
During this initial trip, I made a concerted effort to spend less, but didn’t try to go bare bones with a budget as of yet. The total came out to $42.78, which included some household items, other than food. I knew that this was less than I had been spending but still oblivious to the $500+ a month figure. When I got home, I downloaded a new budgeting app on my phone, and recorded the transaction.
My initial plan on spending less at the grocery store was to simply stop going there as often. I’d usually swing by 3 times per week, so, it’s no wonder I would just buy stuff…I’m “already there” after all. I assumed that if I could cut that number to two times per week initially, that would result in an immediate drop in spending. This is as far as I took the first round of spending cuts.
The next step was to figure out exactly how much I have been spending on groceries. I checked my Amex statements and added up each of the last three months. Here are the brutal results:
September $425.5 (Note: I was out of town for a week, so an actual 4 week estimate was $567.33, had I been in town).
If I include the estimate for the week in September when I was out of town, my average grocery spending was $523.84, each month or $6286.13 a year.
Wow! Even if I had been spending $300 a month, I would’ve saved $2686.13, over a 12 month time frame. That is equivalent to 32.59 shares of ExxonMobil at today’s price, which translates into $100.39 in forward dividends, which as I mentioned was my goal with this stock. Just by not being stupid with my money, I could’ve tripled my current share count, and received an extra hundred bucks this year while doing no work to get a hold of it.
Alrighty, once I saw the numbers first hand, I knew I had to immediately slash that amount. For this first week in the spending reduction, I’ve plopped down about $90 for two trips to the grocery store, which is $360 per month.
At this point, I am on pace to save $163.84 each month which represents 31.3% in savings.
Oh We Can Do Better Than That…
With the most basic changes, the bill is on pace to be cut by 31.3%. However, I have already identified further cuts that can be made, to immediately reduce this amount further. Plus, I have begun researching possible ways to get food at a lower cost. Here are some ideas to keep dropping the amount of cash spent.
Don’t Set a Budget at First
Yes, the opposite of common sense. I want to thoroughly explore how low I can get my monthly grocery bill and then base a budget off of that. I doubt I’m going to practice extreme frugality in this regard, but I can certainly get it into a more acceptable range. I want to see what’s possible and then make further judgments after that. I have quite a ways before I’m broke and there is always a trade off between enjoyment and financial sensibility.
This is easy. Stop buying many processed foods and switch to whole foods that I can prep for myself to save cash. Once that has been fully implemented, see what other foods can be subbed in to further reduce the costs.
I do workout a lot. Even still, I have been completely out of line with my diet this year, as the pricing has shown. I can stand to cut a few hundred calories each day, which might well ad up to $30-60 per month, and not hinder me in any way.
Bulk Purchases and Coupons
I’m pretty sure I have a $20 coupon to use Amazon Now. With that, I can probably buy lots of rice, beans, and potatoes in bulk. From there, I can begin buying some items in bulk and freeze them, and try to find worthwhile coupons to use.
Keep Using a Budgeting App
This will help to keep me honest and on top of things. Otherwise, I’ll forget that I have spent X-amount of dollars already this week, and be prone to doing it all over again a few days later. This alone was a major part of getting the first phase of this plan implemented and needs to continue.
Try to Go Shopping Less Often
Week one, I reduced my trips from 3 times per week to 2 times per week. Better, but with planning I can have a list to get that to once per week then bi-weekly and maybe once per month. This will come with time and having a clearer picture of exactly what I’m going to buy, where I’m going to get it from, and how much it will all cost me. The fewer trips equals fewer chances for me to purchase random crap.
Further Reductions in Spending
I not only need to cut my spending on food, but I also need to cut my spending elsewhere, in terms of both time and money. As I’ve written, my focus this year hasn’t been great. My social life has been cool but that’s gotten out of hand as well.
This means, that I am going to make a concerted effort to reduce my spending when going out, and reduce the number of times each week that I do hit the town. First of all, drinking alcohol needs to go by the wayside. I don’t drink much, but 1-3 drinks can add up, those weeks when I’m out 4 times.
Secondly, I should drive myself to more places, which I don’t always do because I know I might be drinking. Parking downtown can run $3-5, which is cheaper than Lyft, but is still a hassle to deal with. I need to be smarter about where I do elect to go and cut down on the number of invitations that I accept to hang out. I’ve passed on three social gatherings over the past four days and feel like I could be out any night of the week, if I so chose, just because there’s always someone with something to do.
I’m not going to be a hermit. There is just a better way to go about being social than I am currently pursuing, and with the savings I will have from groceries, I won’t have to spend every night alone…but there is still extra cash to be found in my monthly budget.