Saving money efficiently can help you become financially secure and provide an emergency safety net when needed. An emergency fund provides a sense of security to us, but it is a common stressor for many Americans.
89% of Americans admit to saving money each month. Yet only 45% could pay for a $1,000 emergency without using a credit card or taking out a loan. This leads to fewer than half of Americans being able to save effectively.
The main area that consumes a large portion of possible savings is also the area we can save the most: Shopping.
Shopping is so woven into our culture that it has become a favorite pastime for many of us. Oftentimes, we turn to shopping when we are excited, stressed, sad or bored.
Making smart financial choices is something we all aspire to do. However, persuasive advertisements can make it difficult to say "no" at times.
Besides, why does shopping smarter really matter?
Because it helps us with a crucial cornerstone habit vital for wealth accumulation: Saving. Cornerstone habits are minor habits that trigger beneficial results in different parts of your life. Saving happens to be one of them.
The majority of us engage in some type of shopping on a daily basis. Many people frequently spend money, whether it's a quick trip to the grocery store or grabbing a morning coffee.
When you go shopping with the mentality of saving, it helps you to avoid mindless spending. No matter your income level, shopping smarter can accrue a healthy amount of savings over time. These savings will ensure that you have a comfortable financial cushion in times of uncertainty.
Besides, little things add up quickly. Saving just $300 per month (about $10 per day) can leave you with $3,600 for your emergency fund at the end of the year.
Below, we will discuss fifteen ways to save money and curb unnecessary shopping spending.
RetailMeNot and Ibotta rank among some of the best cash-back reward mobile apps, but there are many others to choose from. Money-saving apps for shopping give you points based on the items you've purchased. Once you've earned enough, you can receive cash or gift cards in exchange.
Ibotta, RetailMeNot and other rewards apps are not just limited to grocery purchases. You can earn rewards points from retail stores, restaurants, pet stores and more. Getting cashback is easy, too. All you have to do is:
That’s it. You can earn cash-back for staple items you would purchase anyway, like milk or laundry detergent.
Small, unnecessary items are the biggest culprits when it comes to draining your cash. Seriously, what does one more item really mean? Adding something extra only eats into your hard-earned money, which could be put to better use elsewhere.
In most cases, impulse shopping doesn’t just stop with one item; it comes in groups. The easiest way to stop impulse buying is to recognize it and avoid it.
Don't shop while you are stressed to avoid purchasing items for instant gratification. Clear your mind and step away when you feel that urge of impulse building. Once you feel more centered, return to your item, reassess the value of it in your life and make a rational decision.
Eliminating impulse buying helps to prevent compulsive spending over time. Practicing this with each shopping expedition and avoiding impulsive buys can save you substantial money over time.
Crafting a grocery list goes beyond mere organization and efficiency at the grocery store. In fact, it can lead to substantial savings of hundreds of dollars each month. Unfortunately, many people don't put much thought into their grocery store trips.
When you're running low on time, unsure of what food you already have, or don't know what to make for dinner, you're likely to start picking up familiar or eye-catching items to save time and energy.
This seemingly harmless habit is where the overspending comes in. These grocery store trips result in duplicate food items, impulse food buys and a fair amount of guesswork. Have you ever gotten home and realized you already had two packs of chicken in the freezer and forgot laundry detergent?
By conducting an inventory of your pantry and refrigerator beforehand, you eliminate the risk of surplus items. This way, you know exactly what you have and what you're missing for the week.
Plus, a shopping list allows you to look at weekly sales and compare prices, saving you even more money and expediting your trip. Apps like Instacart show relatively accurate prices of food items for your store and location, giving you an idea of how much your grocery budget should be and how much money you can save on sales.
Sometimes, a trip to the grocery store is already well-thought-out, only containing items you really need. How can you save even more money now? By choosing store or generic brands over big-name brands.
Most store brands offer a 15-30% discount over the same big-name products. According to the National Hog Farmer, "Even when generics are 15% cheaper, a majority choose the brand-name product. But if generics are 30% cheaper, a majority of consumers will choose the generic brand."
This study shows that consumers are willing to purchase a generic brand over a big-name product if the price reflects significant savings. In many cases, the store brand and big brands use the same manufacturers to produce their products, so choosing generic brands gets you virtually the same product at a discounted price.
Rather than paying extra for a known name with colorful packaging, reach for its generic alternative. Whether it's a 10% or 40% savings, your wallet will thank you.
Price comparison is the compass of a savvy shopper. Before purchasing that product with a flashy display, check the price of the same product at another retail store or online.
Don't be swayed by the first offer. Since retail and online stores can make their own prices as long as they meet the manufacturer's minimum price, an item can sometimes vary by hundreds of dollars.
Check for promotions, discounts, and liquidations from other brands. If you are shopping online, comparison plugin tools, such as Honey, scan the internet for better prices or current sales on your desired item.
Oftentimes, stores have overstocked or discontinued items, which creates excellent deals for shoppers and heavy price cuts for the store. Remember, a few extra minutes comparing prices and clipping coupons can translate into substantial savings.
Credit cards can give us a false sense of purchasing power. Cash, on the other hand, is much harder to part ways with.
When you use cash to pay for any item, especially one with a hefty price tag, it forces you to be aware of how much that transaction will cost you. Rather than piling more debt onto your credit card, try and adopt an all-cash diet instead.
You may surprise yourself with how far you can actually stretch your money. Carrying cash helps to make you more aware of your spending habits and teaches you how to stretch your money further.
Bargains aren't usually out in the open. They are often placed in recessed parts of the store to encourage you to pay full price. The design of supermarket layouts is intentionally aimed at encouraging consumers to spend more. These businesses operate on earnings; Therefore, their main objective isn't to assist you in saving money.
Variables like how the store is structured, the colors and words used and the positioning of every product have a solid profit-driving reasoning behind them. A classic supermarket trick keeps the most expensive items at eye level, which means the middle shelf for most.
People buy what catches their eye, especially if you don't have much time to browse. To find the lowest price options, look at the bottom or top shelf in a grocery store aisle. This is usually where the most budget-friendly alternatives are stored.
The advice to shop in high heels to economize might appear strange. However, two marketing professors at Brigham Young University discovered that wearing heels can enhance shopping decisions.
Wearing heels when shopping actually inspires you to make balanced financial decisions. Marketers employ numerous strategies to prepare the consumer's mindset for buying their products. However, consumers can also take steps to enhance their cognitive abilities before purchasing.
Sometimes, wearing heels isn't always feasible. Fortunately, there are other activities you can engage in to attain the same feeling of balance. Visiting the mall after a yoga session, standing on one leg while shopping or leaning your chair back when shopping online are all viable options.
The rule is relatively simple: wait 24 hours before making large purchases. A large purchase can look different for many people, though. Some feel $100 is a lot, while others may set that limit at $500.
Before making a significant purchase, allow a day to pass. Grant yourself time to reflect and assess whether that potential purchase is a momentary desire or a lasting necessity. This waiting period acts as a filter, weeding through impulsive urges.
It's a strategic move to avoid buyer's remorse and ensure that your financial choices align with your long-term goals. A day's delay can be the difference between an impulsive splurge and a thoughtful investment.
Before you make your next purchase, take a moment to set clear financial boundaries. This can be done effectively with a dynamic household budget. When determining an overall budget, you must first assess your situation.
Start by categorizing your spending for the previous year, such as:
Once you have categorized your spending, begin to calculate the total cost for the year in each category. Write down the amount spent for each category and divide it by 12 to get a monthly average.
Next, add up your total household income after taxes, then divide this by 12 as well. This will give you a baseline of your monthly spending and income. Once you have these averages, you can assess how much you save or lose each month.
After determining what you have left over each month, allocate a specific amount you can spend freely. Remember that this shouldn't be the entire amount you have left over each month. That would leave no money left for savings.
If you lose money each month, sort through your spending and bills to decide where to make cuts. This could include reducing your phone plan usage, cutting down on dining out or eliminating subscriptions you don't use.
Your household budget should be followed strictly to prevent overspending or savings losses. This idea turns a shopping experience into a conscious and controlled endeavor.
Buying in bulk stores like Sam’s Club and Costco isn’t always a money saver. While it can cut down on the cost of each item, it may result in overbuying.
These membership-based stores have discounted goods, which often cause people to spend more than they need to. A study showed that people who frequently shopped at Costco and Sam's Club spent 101% and 109% more in-store than nonmembers.
Stocking up on perishable food items can be pretty wasteful. Finishing them before they go stale is highly unlikely. The better alternative is visiting your supermarket when you need more fresh produce.
This allows you to purchase only what you require. Reserve bulk stores for items you buy in large quantities and products with a longer shelf life, such as soap or paper towels.
Buying from bargain outlets can cut down your expenses on apparel and accessories. Stores such as TJ Maxx and Marshalls offer considerably lower prices than conventional department stores. On top of that, they frequently run additional sales where you can get bargains on your preferred brands.
If you choose to shop at department stores, try to focus on the discount sections as much as possible. If you're eyeing a particular dress or sweater, but it's not an immediate necessity, hold off for a while and see if it ends up on the discount rack.
Remember, you can often find off-season clothing at significantly reduced prices. This implies purchasing a winter jacket in the summer and beachwear and shorts in the cold month of December.
Items like books and wooden furniture should never be bought for full price. You can usually find like-new versions of these products for discounted prices at thrift stores.
Purchasing used books, home decorations, jewelry and furniture can help cut down on expenses. The experience of shopping at thrift stores will vary based on your location, the number of shoppers and the season. Therefore, making multiple trips at different times of the year will offer a wider selection of items.
Always be on the lookout for thrift store sales as well. Most thrift stores have storewide sales annually, offering even more discounts on top of already discounted items.
eBay is a website many people forget about when making big purchases. Websites like these offer slightly used laptops, appliances, furniture and even cars for a lower price.
Another great benefit of eBay is that you can negotiate or bid on the price. Stores like Target or Best Buy have set pricing. eBay allows the buyer and seller to meet in the middle on a price.
The only downside to sites like these is the need for patience. With millions of users daily, many items are for sale and even more people are bidding on them.
In the pursuit of mindful spending, it is crucial to ask yourself a simple yet powerful question: Is this item truly necessary? Before making any unnecessary purchases, take a moment to reflect on whether or not the item is truly essential.
Consider whether it's an immediate need or if it fulfills a genuine purpose in your life. Picture where you would put it, what you would use it for or how long you use it on a regular basis.
This reflective pause acts as a built-in filter and forces you to take a calculated approach to spending and collecting items. It's also a great way to avoid clutter and excess items in your home.
So, the next time temptation calls, ask yourself the golden question—do you genuinely need it? Your wallet and living space will thank you.
Saving money is both a habit and a skill. By practicing saving methods with everyday activities like shopping, you can hone that skill and strengthen that habit. After all, saving money is psychological. We can always overcome our money biases and take steps towards a more secure future.
It’s never too early or too late to take control of your financial future. By saving a small percentage of your monthly income, you are taking positive steps towards maximizing your personal finance goals.
Plus, placing your saved money into a dedicated savings account will help your wealth grow even further at no extra expense to you. So, what are you saving for? Learn about Seacoast Bank's personal savings account solutions.