Where Am I Wasting Money & How Does that Impact Me?- Part 2-Grocery Shopping

We all waste money & do it in many ways. That might be OK. If we’re ultimately planning for and putting our money towards the things that are important to us, wasting a little money isn’t going to hurt. But the reality is that most people are not saving for and investing in the things that are priorities for us. Paying off debt, retirement, kids’ college, purchasing a home, travel to interesting places, giving generously, etc. are not actually happening for many people. When we’re not getting what we really want, when we’re making good money and have nothing to show for it, wasting money is a big problem. The first step in figuring out where money is being wasted is to complete a budget & review spending. For information on how to complete a budget, click here. To review my last post, “Where Am I Wasting Money, Part 1, Eating Out”, click here.

This week I’ll be discussing one of the biggest “variable” expenses in our budget, Groceries. If we look at the latest USDA estimates of food costs (found here), aka groceries, for an adult male, the average monthly cost per person ranges from $300-$450/month. For people that have special diets, or do a lot of impulse buying, that number can be considerably higher. Females & children are, on average, a little lower. It can be really shocking how much groceries cost!

So, what are some strategies to keep the costs down? Strategy #1 is to shop from a grocery list. Before putting the list together, check the weekly ad from your local grocery store (often found online or on the store app). Also, check for online coupons (also often available on the store’s app). See what’s on sale or has a good coupon, and then put together a meal menu for the week around those items. As the list is prepared, check the pantry and refrigerator to make sure that you don’t already have some of the items on your list. A lot of money can be wasted on items that we already have on hand. Be careful of the quantity of fresh items purchased. If fresh items purchased spoil, that’s by definition, wasted money.

Next, when at the store, stick to the list & be careful how you shop. Stores are setup intentionally to walk you right by potential impulse buys. As you’re walking the store, you might notice that there are things in your way that you have to maneuver around. That’s intentional. The store intends for you to notice those items and throw them in the cart. Avoid that trap! As much as 10-20% of items in someone’s cart could be an impulse buy. Also, as you move through the store, the more expensive, high margin items are often at eye level. The $5-6 box of brand name cereal will be at eye level. The cereal manufacturer paid the store for that product positioning to boost sales. The less costly store or bargain brand, which is often just as good, might be on a lower shelf & require a few seconds to find. Spending those few seconds scanning for a better deal alone can save up to 50% on certain items. If you’re not sure of the overall cost, refer to the per-unit cost on the shelf price tag. You’ll get a per ounce or per pound cost that will more easily show which item is the bargain choice. And, as we know, buying a larger package size, may confer some savings. But don’t assume. Check the per-unit cost. Additionally, buying a large size of an item that’s not going to be used much, isn’t going to save any money sitting in your pantry. We all probably have a few of those items clogging up our pantrys.

Also, doing the grocery shopping with cash can be a big game changer. If we want to stick to our budgets, then using cash is a great way to do that. If we budget $800/month for groceries and take out $400 twice a month in cash, and only use that cash for groceries, then we’ll always stick to our budget. Beyond that, cash makes us more aware of what we’re spending. When we’re counting out 10s and 20s at the cash register, we really feel the cost & are far more likely to pay attention to the prices and our overall spending. When we swipe our debit or credit cards, we barely notice that we spent any money at all. Try cash! It very well might blow your mind!

Finally, especially for people that aren’t keen on using cash, shopping for groceries online & picking them up (avoiding unnecessary delivery charges) is a great way to stick to the grocery list. It’s much harder to impulse buy if we don’t actually set foot in the store! Don’t forget to tip the person that loads your groceries in the car. They saved you a lot of time with their efforts, and they’re not highly paid.

One last comment about bulk buying. It’s no guarantee that buying in bulk from a warehouse store is going to save you money. Just because you buy a package of 50 doesn’t mean it’s a great deal. And if you’re on a tight budget trying to pay off debt, have a six-month supply of granola might not be the wisest move. I shop at Costco, and I’ve found that certain items, that we use frequently, are a good deal and worth buying in bulk. Staples for us like toilet paper, paper towels, frozen fruit and vitamins are great deals! Especially when purchasing the Kirkland store brand. But, on closer look, many of the name brands cost more per ounce than a store brand at the grocery store. An example is peanut butter. Buying a bulk two pack of JIF peanut butter is more expensive per ounce than the store brand peanut butter at Kroger. So, carefully comparison shop, make sure you buy things that you use frequently and avoid impulse buys. Costco is setup for impulse buys! They even have people tempting you with “free” treats to entice you into buying their product. And that’s not to mention the other side of the store with various gadgets, household items and clothing. So, shop carefully!

As I work on this series, hopefully you’re gathering up some great ideas about how to not waste money & allocate more money to your priorities. I’ll have more ideas for you over the next few weeks. As you read my posts, if you’re really struggling to put money towards important things in your life, click here to setup a Complementary Consultation. We’ll get to know each other, and you can find out more about Financial Coaching. Ultimately, we can both find out if coaching is a fit for you and your situation.

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