Everyone wants a full wallet, but some money-saving tips and tricks require hours of effort and frustration, while others end up costing you money. The result? Both your wallet and your patience wear thin.
Is this Money-Saving Tactic Worth It?
There are two questions that can help you determine whether a money-saving tactic is worthwhile, says Brian Davis, a real estate investor, cofounder of SparkRental.com, and a personal finance blogger for the investor site Bigger Pockets.
1
Will this activity lead you to spend money you wouldn’t have shelled out otherwise?
If the answer is yes, just say no.
Next, if the activity actually does save money, calculate the dollar amount saved and the amount of time required. And ask yourself:
2
Would you work a job for the hourly pay of the money you save with this tactic?
If not, find a less time-consuming way to save.
If you don’t ask those questions, it’s easy to get sucked in by money-saving time wasters.
Frugal Activities Not Worth the Money-Saving Effort
Here are five frugal activities that aren’t worth the effort.
Couponing
Clipping coupons digitally or with scissors can makes sense if you come across one for an item you normally buy. However, serious couponing can cut your free time along with your costs.
Time Spent Finding and Cutting Coupons
Sites like The Krazy Coupon Lady describe methods of tracking down coupons that require scouring the internet, subscribing to your local paper to obtain coupon inserts (which, of course, costs you money) and even buying coupons. When it comes time to use those coupons, you’ll drive all over town to hit the various stores offering the best deals.
Space Needed for Stockpiles of Sale Items
Finally, many people who get into coupon cutting find they need to create space in their homes to hold the stockpiles of goods they get on sale but might not use up for years. And all this can backfire. A worst-case scenario: You spends months filling your freezer with meat purchased on sale, then the power goes out in an ice storm, spoiling your stash.
“Many people find they spend hours sitting at the table clipping coupons, and at the end they have $10 worth of savings.”
Brian Davis
Do the math, Davis advises, and you’ll probably find couponing earns you “a fraction of minimum wage.”
The Exception
If you have plenty of extra time and enjoy couponing as a hobby. As long as you’re not spending more than you save by paying for couponing classes, buying coupons, and filling up the gas tank to drive all over town, have fun.
Chasing Freebies
You could spend hours perusing the internet for free money, where companies give you incentives to sign up for a free service, open a bank account, or complete a survey.
Hunting down these deals and jumping through the required hoops can take hours, and you might wait weeks or months to get your gift card in the mail.
Also, there’s plenty of fine print that goes along with these offers, and some consumers fulfill their end of the bargain but fail to receive the promised reward. For example, a person never receiving the $100 they were promised for opening and using a prepaid credit card.
The Exception
Some banks offer bonuses from $150 to $300 for opening a new account and fulfilling a few requirements. If you were thinking about switching banks anyway, these offers provide a nice incentive, according to Kathryn Hauer, a certified financial planner and the author of “Financial Advice for Blue Collar America.” Just make sure there are no hidden fees or unreasonable rules about how much money you have to keep in the account, she warns.
Downloading Money-Saving Appss
It’s easy to load up your smartphone with apps that might save you a few cents or dollars, but they may also encourage you to buy sale items you wouldn’t otherwise have purchased. Many retailers have their own apps that dangle deals to encourage you to buy, buy, buy.
The Exception
Some apps are easy, don’t nudge you to buy items you’re not specifically shopping for and offer a simple set-it-and-forget-it interface. For example, Byers loves the browser extension Honey because when you go to shop for an item online it scans the internet for coupon codes. “You don’t have to do anything and you automatically save money,” he says.
Being Penny-Wise
Buying cheap appliances, clothing, tires, and other products, such as insurance, can lead to spending more in the long run than if you had invested in a quality item or service from the start. Cheap goods may break or fail to work as expected. In that scenario, you’re out more money than if you had invested in a quality item from the start. You’ve also wasted a lot of time with the hassle of dealing with and replacing a broken or malfunctioning product.
Example One
It pays to buy quality homeowners insurance and car insurance to so you can count on your insurer to come through for you if you have to file a claim. Buying cheap insurance can backfire if you’re forced to deal with slow claims, poor service and skimpy coverage.
Example Two
Another example that many people don’t think about is shoes. Cheap shoes can cause foot problems, and result in a trip to the podiatrist, hundreds of dollars in medical bills and the need to spring for the quality pair you should have purchased initially.
“Buying cheap shoes to save money may have worked when you were 25,” Hauer points out. “It doesn’t work when you’re 55.”
Kathryn Hauer
The Exception
You plan to use an item rarely, or only once. If you live in Arizona and need a rain poncho for a one-time trip to Seattle with the grandkids, it’s probably smart to buy a cheapie.
Extreme Frugality
If you ever watched the TLC show “Extreme Cheapskates,” you can see how far a person can go to pinch a penny. Cheapskates featured on the show reuse dental floss, work out for free at sporting goods stores and fry up roadkill for dinner. “I read a frugality blog that seriously asked people to consider dumpster diving,” Hauer says. “That’s unsanitary and unsafe. And if you get some disease or cut yourself, the savings you might have gotten from nabbing a fresh dozen donuts will be far outstripped by the hospital bill.”
Less extreme actions like separating two-ply toilet paper into single-ply sheets and reusing ziplock bags might save you pennies, but tend not to be worth the effort.
The Exception
Some little actions like cutting off the end of a tube of toothpaste to squeeze out the last dollop are fine, in Hauer’s opinion. But beware of those that take a lot of time and risk, break a law, anger a store manager, or jeopardize your health.
Money Saving Tactics That Offer Big Payoff
Instead of frittering away your time and cash on money-saving time wasters, try these easy, proven strategies instead.
Research Prices on Key Purchases
Put your time and effort into saving money on consumer items you buy regularly, and also one-time purchases with high price tags. This offers bigger payoff for your money-saving time investment .
Example One
You could spend 10 minutes tracking down the retailer that offers the lowest everyday price on the brand of dog food you buy, and your savings could add up to hundreds of dollars over time, a much better bet than spending the same amount of time procuring a coupon that will save you 25 cents once. That’s because regular purchases (and savings) add up over time and comparison shopping on expensive items offers a chance to save $10, $20, $100 or more.
Example Two
Hauer found that one grocery store in her town sells her husband’s favorite hot chocolate for a dollar cheaper than other stores. If she buys it once a week, that’s almost $50 in savings a year.
Treat Your Savings as a Regular Bill
Handle saving money the same way you deal with paying your cell phone or electric bill. Pick a reasonable amount and automate the savings through your online banking so that sum goes right into your savings account every week or month.
Many experts recommend keeping your savings in an online bank that pays a slightly higher interest rate than many brick-and-mortar banks. If you want to use that money, you’ll need to make a transfer to your main bank, which can take a few days. This cooling-off period can prevent you from spending your savings without a good reason.
Figure Out How Much You Have to Spend
Instead of spending hours on budgeting apps, Byers recommends a simple system he calls Your Magic Number. “It only requires 10 minutes a day,” he notes. After you pay your fixed expenses, including funding your savings account, you calculate how much is left for the month and divide it by the number of days in that month. This is your “magic number,” and you can’t spend more than this on any given day. If you have money left over, you roll it forward to the next day.
Example
If your magic number is $50 and you spend nothing on the first day of the month, your magic number on the second day is $100. If you spend $95 that day, your magic number on the third day is $55.Using this system forces you to live within your means, save money and make smart spending choices. It also prevents a common situation in which you do your daily spending on a credit card, accidentally spend too much, then use the money in your savings to bail yourself out at the end of the month, according to Byers.
Any time you spend trying to save money takes away from time you could be spending on other life experiences, in Byers’ opinion. That’s why it’s smart to find a balance between effort expended and money saved. “It really is a trade-off,” he says.
What do you think? What money-saving strategies do you use? Have your tactics surprised you with a fuller wallet? Share your experience in the comments below.
I have washed and reused plastic bags for years from anything stored in them except something that may make you sick (fresh raw meat) or something other than food. When the bags start to look like they have never been washed, I put “things”, not food in them. Plastic can take hundredof years to dissolve, birds fish and other animals die from eating it, and it’s a mess when thrown anywhere outside. I used coupons all the time years ago. rarely use them anymore and still have a bunch with UPC’s on them. I’ve found a number of less expensive products that are as good or better than the name brand products. I use a rare coupon on a product I regularly use only if it’s worth cutting out and only if I am almost out of the product. I used to ‘stock up’ and ended up with lots of “stuff” that I ended up giving away because I could never use that much. I learned to savethe hard way, by doing things that ended up costing me instead of saving me money.
I agree with most of these saving ideas. I also pay $1 or more to get the change and then save the quarters and pennies. I also track my monthly bills because I get social security and pension. The first of the month my mortgage and insurances are paid out of check. The only other bill may be one of quarterly bills. What’s left is carried over to the second part of the month which is basic cable, cellphone, 2 charge cards, water plus 2 contributions. I seem to do better now I am retired. This budgeting has helped me in having extra money in my checking account each month.
1. Keep a monthly budget – by expense category. Not as a definite but as a guide. Write down ALL your expenses by category DAILY. Look at your fixed expenses that don’t change each month. Don’t forget to include 1/12 of bills that you only pay annually like auto, home insurance etc. Subtract fixed expenses from your net pay. That’s how much flexible money you have to spend. Add your total expenses up at the end of the month and compare to your budget. Then, a) Ask your self if your actual expenses was where you WANTED or NEEDED your money to go. If not, adjust your spending and focus on what you NEED vs what you WANT! 2) Now that you have an idea of where your money really goes or where you want it to go, adjust your budgeted amounts by category to realign them. Repeat every month! After a while, 6-12 months, you’ll have a better idea where your money is going vs where you want it to go. Now again, use your budget aaa a GUIDE because you will never have one where monthly expenses by category equal actual. Each month some categories will be over and some under. But the unders can help pay for the overs. This may seem a lot but it isn’t if you do it every day. Yes, it takes an hour at the end of the month, but worth it. I do it on an Excel spreadsheet and then layer the preceding month over the present month and know my year to date actual vs budget, then for the whole year- I know what my ANNUAL expenses by category were – budget vs actual. Any amounts left over go straight to savings, mutual funds, etc. BTW, if you go to a Financial Planner, keeping track of your expenses is the first thing he or she will have you do.
I paid off my car loan last March 2019. Since then, I’ve put the same amount of my car payment every month into a savings account to save up a down payment on a newer model car. With my stimulus payment in April 2020, I’ve also put that into my savings account to add to my total savings amount. Some of my friends and family used their stimulus check to purchase a newer TV, new couch, etc. while I felt at my age of 72 yrs. old, I can live with my couch, TV and other items that don’t need to be replaced, but I feel a newer car would be more important to me than a smart TV or cushy couch! By doing this type of savings, I’m hoping my monthly payment on a newer car will actually be less than I paid in the past. Time will tell. I would suggest people who need a newer vehicle would do the same, for it will undoubtedly be able to get a better used vehicle than if they hadn’t done the same thing I did.
I thought at first this was a good article for anyone who went overboard trying to save. I do most of these things the way suggested. I do reuse zipper plastic bags that only contained fruit or vegetables, often for organizing hair ties, placing small containers of shampoo and such for travel as insurance they don’t leak in my luggage. The one thing that may be a little under-researched was the example of having $50 per day discretionary spending after bills. Many people don’t even have that for income, let alone left over AFTER paying bills. Just my two cents worth!
I totlly agree with the Zip Lock bags being reusable. We wash them and get 4-5 uses fo each one. Funny my wife’s name is also Jane. Plastic bag fetish if named Jane hey.
With the virus, we can’t use any coupons. We pay not only the price the store sets, but it costs the consumer more for food. I see the stores point, but there must be a better way that we can still use our coupons for a product.
WHERE IS THE INFORMATION REGARDING THE FIRST LINE OF THIS EMAIL,,,DO I OWN AN OLD CAR ?
Hi Gary – The article from the most recent newsletter you are referring to is here: https://extramile.thehartford.com/auto/car-insurance/reduce-coverage-as-vehicle-ages/
For questions regarding your account, please contact our customer service center at 800.423.0567. Our agents are available Monday-Friday 7am to 11pm EST and Saturday and Sunday 8am to 6pm EST.
Thank you!
I like to try different local places to eat so I use Groupon or Living Social (both are owned by Groupon). The price is reduced and Groupon often offers an extra percentage up to 30% off the already reduced price after you join for free. Before buying the Groupon, I check the reviews for the restaurant at other sites to determine if I will buy. For the ones I choose, I get to try a new place and if I don’t like it at least I didn’t pay full price for my first visit. Sometimes I find a real gem that I return to again.
I hate using coupons, but last week Hannaford alerted me to several items that I buy regularly. In addition, they were offering a further $11.00 off, if you spent $100.00 or more. These coupons took just a minute to clip online. As they were right at the beginning of the sequence! Since I had not been shopping for groceries for two weeks, I took advantage of this and the savings were impressive.
Jeff! You sound like a guy that would use the line from ‘Kingpin’ when the Woody Harrelson character asks the old-timer outside his shabby dwelling, “How’s life?”
The old-timer responds gruffly, “Takin’ too long.”
Save hundreds of dollars by ordering water instead of soft drinks at drive ins and restaurants.
The way to save a lot of hard earned money is to cancel Hartford and to get insurance with Erie or Mutual. It is hard to believe what I could have saved over the years, had I not believed AARP was really in our best interest! I thank Hartford for increasing my home owners this year to $800.00, I should have woke up last year with an increase of $200.00, a $1000.00 increase in two years!
Ron Sheetz
I dont buy anything I dont need.
It’s unfortunate that you do not provide Mobile Home insurance in your program.
Someone needs to cast Jeff (Nov. 18 post) a “lifeline” it appears. He should get involved in a food bank, or some similar good cause which will greatly appreciate his time.
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The problem I have with coupons is that they offer price breaks on products that are so expensive to begin with that even with the coupon the product still costs more than the store brand. Is the $15 a pound coffee (after a $2 discount) three times better than the $5 a pound brand? I guess it’s a matter of taste but I can’t tell the difference.
I’m in complete agreement with Joanne Moore about re-using plastic items such as ziplock bags. The ocean is drowning in plastic, with more and more sea life dying due to ingesting plastic, especially bags.
Use coupons only on items you buy; sometimes we may buy something we don’t use just so as to use the coupon..wrong.
Always keep an eye on the EXPIRATION date!
Great column. Very informative.
One way I save is I never give exact change when I purchase anything. I always pay over so that I get loose change back. Then I save all the loose change in a jar, and occasionally take it to my bank. It adds up quite fast.
My bank is awesome! Every time I use my debit card someplace other than my bank, they pay for the transaction fee. Some places charge $3.00, but I don’t pay anything!
Also, I signed up for an online investment program awhile ago. It’s called Acorn. I linked my checking, credit cards and debit card to it, and they round up my purchases to the nearest dollar and when they have accumulated enough, they invest it for me. I opened up this account with only $5.00 and I think I have over $600 now. Great way to save money. Of course, you won’t get rich over night, but you’ll have an emergency fund if you need it and I never miss the money.
I totally disagree on one statement on #5, extreme frugality. Reusing ziplock bags is important, not so much for the pennies you save, but for reducing plastic. Plastic bags are made from fossil fuels, and we are not charged for carbon use, nor are we charged for the effect excess use of plastics is causing the environment; Think of how long you use a ziplock bag, and then remember that plastic does not break down in the environment. Plastic bags in the ocean are mistaken for food by whales, dolphins and sea turtles, and these animals will die if they eat too many plastic bags. Plastic bags will eventually photodegrade into small bits of plastic, which fish mistake for food. Volunteer for a beach or park or riverbank cleanup, and you’ll see 1st hand what plastic bags are doing to the environment. So yes, reusing ziplock bags may only save you pennies, but it will be a small step you can take to decrease your plastic footprint.
I’m retired. My time is worth nothing. Every $ I save is another minute I get to endure this miserable existence
I make my own yogurt, using shelf stable milk that you can buy at the dollar store for $1/qt. You can make it with powdered milk, too, which also works out to about $1/qt if you buy the store brand.
Also it’s ridiculous to buy canned soup — most taste terrible, and it’s much cheaper to make really delicious, nutritious soups/sauces yourself. No cream required — just add a spoonful or so of rice to a butter-softened onion/garlic/celery base with a bouillon cube & water, boil it up, and use an immersion blender to puree it when all is cooked. You can cook in it whatever you like — lentils? potato? spinach? nuts? pumpkin? carrot? — before you puree it for a wonderful bisque. Or add leftover cooked cubed veggies, seafood, etc. for a chowder. Or add a little flour-paste roux (or stale bread) and seasoning and it’s a curry or creole sauce for a little cooked meat and rice. This simple base creates many cheap meals. One of the first places I go at the grocer’s is the shelf with all the marked down produce. The other place is the marked down bakery items. It’s a treasure trove, and a source of inspiration.
Lastly, don’t turn up your nose at big root vegetables. They may get stinky or mushy if boiled; some are even bitter or soapy tasting when raw. But when you slice them up and roast them — a magical transformation. Examples: big cheap Asian radishes of various kinds, parsnips, turnips, and rutabaga. Same goes for chayote squash (very cheap and you eat the whole thing) and cabbage hearts.
You touched on a subject that IMO needs to be expanded: Determine what your fair hourly rate is and apply that to all your ‘free’ time. I do my own basic automobile servicing but take our vehicles to a trusted shop for major or difficult repairs. I mow our lawn and do basic upkeep but have a (licensed) professional do major work such as tree removal or outside painting of our two-story home. I schedule necessary shopping, take a list, and try to include all of the errands for the week in one outing. If I need an expensive tool, but only rarely, I try to rent rather than purchase – or find one used but well-maintained (such as from a tool rental shop). Renting also avoids the issue of storage – which also can have a cost basis. (How much room do YOU have in YOUR garage?)
John Albaugh, where do you Bank? I’d love to participate in the ‘keep the change’ program your bank offers. Thank you.
Char commented about stores offering buy two or more in order to get the sale price. I only buy the quantity needed and get the sale price from my local grocery store on each item.
I don’t know how other people use coupons, but for me they are a savings. I use coupons for everything I normally buy. Will us a coupon for things I want to try only if I believe we will use/like this item. I live with my son and his three teenagers. I buy healthy foods and cook them myself. The cooking yourself will save you a lot of money and the food is generally healthier. The big box store I shop at has great coupons and will accept Manufacturers coupons and the store coupons on the same item. If I have a $3 store coupon and a $1 manufacturers coupon on laundry detergent that is a great savings. I saved over $1000.00 just using coupons in this way from October of 2017 to October 2018. It takes about 2 hours once or twice a month to gather the coupons together before I go shopping. Keep track of the money you save doing this and you will be surprised at how much you can save.
This was a very informative read and gave me lots of ideas to think about. Thank you.
Thanks for your feedback, Betty Jean!
My bank offers a program called “keep the change “ when you use your debit card they round your purchase up to the next dollar and deposit that amount to your savings account. So far this year I have saved over $800.00 . I did nothing and it cost me nothing.
The answer is BUDGET. Add up all your expenditures for a month. Take your income, subtract expenditures and that’s what you have left to spend. Put savings as one of the expenditures. Another small way to save. The amount you pay for your groceries add the amount the store gives in their coupons, have a running record of this.. I charge my food account the full amount as though I didn’t get any savings from the food store. My savings, to date, is over $400 from savings from the store. I have spent the excess on things I wouldn’t normally buy, like a lunch in a special place..
What I see happening, but I don’t participate in it, is grocery stores offering a great price on items but only if you buy 2 or more to get that price. They also bundle different items to get saving on all of them, some of which you rarely, if ever, use. This causes people to stock up on items they don’t really want in order to save on their chosen items.
You missed a few time wasting activities. An expensive one, over time, is smoking and the health related causes can bankrupt you. Another is buying lottery tickets the odds are very high and the temptation to spend more on large jackpots is costly.
Gambling, in general, can cost you a lot more than you realize, your job, marriage and your self esteem. Alcohol and other substance abuse is affecting too many people in our country and is getting worse. These habits need to be addressed and
feel free to use them in your next money saving blogs.
Today’s coupons are not what they used to be. Back 70’s I used to bring the grocery stores to there knees. Store coupons and manufactures coupons and best of all double coupons. If you didn’t use all the items, you could share with friends, family, or food banks. I miss it.
Wow thanks thought I was just being an old lady I do not travel store to store ever
I use your savings idea but I round up always drop the pennies
The worst one is cheap paint. Don’t ever buy cheap paint.
To make cheap paint the manufacturers simply thin out the good paint.
The result is you need to apply two coats double usage and the cost is more because now you have invested twice as much labor and even worse most cheap paints peel after a few years costing a fortune to chip and sand it off.
Always buy the best paint.
Great point that escapes a lot of folks. Once you paint a house, you don’t ever want to do it again – trust me.