I admit that I’m ignorant about business and economics. I’ve been a student for the majority of my life so far, and it seems like the only “economic success” I’ve had is racking up a shocking amount of student loan debt throughout the years. Recently, I’ve been playing catch-up with economic terminology so that once I actually have a positive cash balance, I’ll know what to do.

I’ve read a bunch of guides on cutting spending and minimizing expenses for the average-Joe, but many of the suggestions don’t necessarily apply to me or seem a little bit too fundamental.  Nonetheless, I’ve decided to add on to the list of online guides, and offer some of my thoughts on saving money. Perhaps they will be of use to some people.

1. Credits cards. I am considered a “transactional user”, which simply means that I pay off my credit card balance at every billing cycle. While it’s commonplace for me to tell you not to carry a balance since I don’t myself, I’d imagine this is where you rack up excess consumer debt. Credit card companies charge hefty interest rates up to the 20-30% range for balances. If you carry a monthly balance, then it’s time to crunch the numbers to see where you’re bleeding cash. When you do use a credit card, get some cash return with one that pays cash back on your purchases, like the Chase Freedomcard. I get 3% back on my top 5 categories of expenses, and 1% back on everything else. It adds up, albeit slowly.
2. Daily expenses. Yes, people tell you to cut back on your daily Starbucks latte or stop eating at restaurants, but can we make the sacrifice? My advice is biased, but part of my philosophy is to live within your means without deprivation. Yes, I could “save” a lot of money by eating gruel every day. In fact, I could dilute my gruel to save even more. On the other hand, it’s probably not too economical or healthy to eat at Peter Lugar’s every day either.
   1. The goal in cutting back on daily expenses is to identify what to adjust without feeling punished. If you drink daily Starbucks coffee, can you make due with Dunkin’ Donuts instead? (About a $0.50 difference). Try drip coffee that you brew yourself. Find that compromise. Maybe you can buy Starbucks grinds from Costco, and brew it yourself. Or get Starbucks on Tuesdays and Thursdays only.
   2. Groceries. Do you have room to save on groceries? Sure, you can scroll the weekly circulars and hunt down deals. I would recommend doing so only if you think it’s worth your time and transportation cost. Superfresh may have oatmeal for $0.50 less than Pathmark, but you pay in transportation time, $0.15 in gas, and vehicle wear. That would not be worth my time. Fortunately, I’ve hit the jackpot on fresh vegetables at the local hispano supermercado–I cannot find cheaper fruits or vegetables anywhere else in town. Bananas are 25c/lb! I usually load up whenever I go.
   3. Another note on groceries. If you have an Aldi in your city, shop there.  The money you’d save on milk itself there should pay difference in transportation, in most cities. No need to deprive yourself either. I got lucky the other day, and Pathmark was liquidating its Bahlsen (German) chocolate butter cookies. I bought 10 boxes. That should last me 10 days of snax (j/k). And if you do load up on groceries, don’t let them spoil. That defeats the whole purpose of buying cheap food. Either buy less, or cook all of it first.
3. Eating out. Restaurants are hurting as badly as consumers. There are deals to be had. Keep an eye out for any lunch specials. In general, by simply eating lunch instead of dinner at the restaurant you can cut back costs. If that’s not plausible, then perhaps changing the restaurant venue may save you dollars. Instead of eating at Mama Mexico’s, you could have a meal at Chipotle’s. There’s almost always a more budget restaurant alternative, short of fast food. If eating second rate restaraunt food is too much of a sacrifice, don’t do it. It’s simply a good alternative to renouncing restaurants altogether.

That’s it. Obviously you can micromanage all of your expenses, but keeping a general open mind to what you’re spending and what you can afford to cut back on. Good luck on the savings!

misc economy