Wednesday, 08 April 2009

• How To Shop Economically And Be Economical

  
  
  

  
  Learn the difference between Wants and Needs.
  
  Definition of Need:
  
  A need is something that is necessary for humans to live a healthy life. Needs are distinguished from wants because a deficiency would cause a clear negative outcome, such as dysfunction or death.
  
  Definition of Want:
  
  A want is something that is desired. It is said that people have unlimited wants, but limited resources. Thus, people cannot have everything they want and must look for the best alternatives which they can afford.
  
  If you're only going to use something once or twice, and it's not food, consider deeply before purchasing.
  

  • Use things until you literally can't use them anymore.
  • Make sure to check prices on other similar items.
  • Use coupons.

  • Write the name brand company with a compliment of a product you like and use - 9/10 times they will send coupons for their product line. Without coupons, try not to buy anything other than the store brand. Around %75 of the time, from personal experience at kroger - the store brand is better tasting or same tasting and almost always more than $0.20 cheaper. This twenty cents to a whole dollar really does add up.

  • Don't buy soda. It's very expensive and non nutritive. For tasty sugary drinks without high fructose corn syrup buy store brand Kool-Aid. For healthy drinks, go grab a glass and turn the tap on cold. Tea is also a great healthy drink. Bags go a long way and you can buy 100 bag for $1.24!

  • While grocery shopping, round up to the dollar on every product, you will stay in budget. Then grab one item at the end that you want [over all the needs that you are buying] that isn't terribly expensive; and if you are under your budget - buy it! If you're over, tell your cashier you didn't want the item.

  • Take advantage of extreme deals -- BUT only on things that you will use in the next 6 months, or something little that you want. [It's actually okay once in a while.]

  • Buy really cheap vinegar [like, 67 cents for half gallon!], and clean your toilet with it. It's animal safe, does a good job with a bit of scrubbing, and is so much cheaper than even the cheapest cleaners. Never underestimate the power of vinegar and baking soda while cleaning.

  • If you do go out to eat at a sit down restaurant [definitely not more than once a week- it's about 66% more expensive than making your meals at home] take home everything and eat it later if you are hungry those next days or so.

  • Deposit your paychecks directly into the bank. Do not take out more than 15% of your pay check. If you make three hundred dollars after taxes, don't remove more than $45.00 for initial spending.

  Don't own a plastic card that can be swiped to directly pay. That counts for debit and credit. That is a huge part of convenience buying. Like, oh, that $1.49 soda and the $.50 candy bar isn't anything. That's 2.11 after a tax rate of 6%. So... thats $14.77 in a week, if you only buy that every day. Ok, lets add in an energy drink later.. that's 2.11 with 6% tax for one day. Say you do this 4 days that week. That's $8.44. Add that to the previous balance and there's $23.31 dollars a week on convenience buys that you REALLY didn't need. Oh, and then you went through Starbucks one day, and that was 3.49, and the next day you went to the mall and were hungry - so you buy a pretzel for $2.00 and a drink for $1.50 - that's $3.50. So - that's $30.21 just on items that you didn't need. Food items that you didn't need. Food that you weren't really super hungry for, but it sounded good.
  If you MUST, choose Debit over credit. You don't have credit payments to worry about, and it's automatically deducted from your account. It is still just TOO convenient. There is no repercussion for spending money that you never have to see - or so it seems.
  
  Round up to the even or the five bills on the cost of things. It gives you cushion if you make a mistake.
  
  I am all for a check book, if you only use it for purchases that you need, and utility bills. It takes a lot more effort and thought to write out a check. Plus, it is recommended that you track your checks by balancing your checkbook - this way you can automatically see where your money is going and make corrections the next time if you goofed and spent too much.
  
  I personally allow myself an ATM card, for emergencies. Times when you can only pay in cash (out of gas out of state!) and can't pay with a check. Go to an ATM, pay a $2.50 charge, and pull out the $40 bucks to pay for gas, or the $90 to fix a flat. Never ever do I use it for anything else.
  
  Do NOT get loans or payment options for anything other than a home or car. Pay capital on everything, and pay upfront. Nothing like forgetting to pay or getting behind to set you straight into the red zone. Stay out of debt. Stay out of it! No exceptions. I won't get into the problem with student loans in this case. But anyhow, If you can't pay for the flatscreen TV upfront, you don't actually have the money to buy it. Meaning you can't afford it. Sure, 50 bucks a week doesn't seem like much.. but for a year, pay that off and its $2,400.00 bucks over the year, with no interest. That's a lot of money. Add in interest - it could easily be 3.5k!
  
  If you can't pay for it right now, you can't afford it.
  
  Always have at least 15% of what you make yearly in your savings account. Preferably more. If you make $20,000.00 a year after taxes, that's $3,000.00 dollars in the bank. If you maintain this minimum, not only will you have cushion for emergencies, but then you can expand on that.
  If you come to a time when you have a crisis - your car gets totaled and your insurance won't help you get a new car, and you have to pay for a new one - that's a huge dilemma if you only have 3 grand to spend. Assume you are able to find a good car for 6k. Assume you find a payment plan that you can pay it off quickly. You might have to sacrifice your cell phone, or cut your grocery bill down more, or set an alarm to turn of the electric every day at like, 7pm. Cancel your internet for a bit. If you have HD, get rid of it. If you have cable, cancel it. Something. Anything. Make the sacrifices to pay off your debt. Take up another job! Mow lawns. Shovel snow. DON'T play instant lotto tickets. It won't pay out. Remember, they make tons of money off it! Ask your grandparents if they can help out. Get rid of debt like it's a nasty disease. Because metaphorically it is - once you get it, it's easy to loose track of, easy to putt off, easy to get in deep.
  
  Are you an economical shopper?  What do you do to be economical?
  
  

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