How do you know you are getting the best deal when you buy your groceries? Do you even know if you are overspending?
Did you know you can overpay for your groceries?
It’s not just a matter of WHERE you shop such as Wal-Mart vs Sams/Costco vs Target vs Aldi vs your neighborhood grocery store. In many cases people will grab whatever is on sale. Or buy something because there is a coupon even though it is something you normally wouldn’t buy. This is not always the best course of action to save money.
Plan Ahead
Whenever you go grocery shopping it is always best to plan your meals ahead of time. Plan out your week or two weeks or however often you restock. The less amount of times you make a trip to the store, the most likely you are to save money by not buying things you don’t need.
If you have a meal plan then you’ll hopefully know what you will need to prepare those meals. If you don’t plan and don’t know what you want to prepare during the week and go to the store blindly, you will probably grab a lot of stuff you don’t need just because it looks good at the time. This is bad. You’ll probably buy some things you’ll never use and end up throwing away. Especially if you buy perishable goods such as fruits and vegetables. This can still happen even with a meal plan if you don’t stick to your plan.
Compare Value
If you have coupons for things you’ll actually use, great! Use them! But even with that you should always compare value. Sometimes a coupon item or sale item may not be the cheapest. You need to compare apples to apples. Figuratively speaking.
Which is the best value; a package of shredded cheese for $4 or one for $6? You may say $4. But without context you don’t know. The bags look a similar size but the $4 one is 6 ounces and the $6 one is 10 ounces. Therefore the $4 one is 66.67 cents per ounce and the $6 one is 60 cents per ounce. That may not sound like a big deal but it makes a big difference in the value you get and how much utility you get from it. In this specific example it may not make a huge difference in your budget. But when you start adding up multiple items you could be overpaying a lot and be getting less out of it.
So when you are looking at which item to buy, you need to compare the price per ounce or price per unit. The price tags on the shelves usually have this information on them for you. In some cases you may need to do it yourself and since most people these days have a cell phone, the phone has a built in calculator that you can use. Then all you do it take the price and divide it by the units you are comparing; ounces, pounds, # of the things or length, such as for paper towels or toilet paper.
Doing this you will find huge savings. You may think that you are paying more because item B costs $1 or $2 more than item A, but if item A is actually considerably more than item B in the cost per ounce, then you are actually paying more for item A. Being a Value Investor is what Warren Buffet is famous for. So always look for the best value.
Be open to store brands
Many people won’t even try a store brand product. They think they are a cheap knockoff and don’t taste as good or work as good. This may be true in some cases. But in most instances, the store brand or other generic brand is just as good if not better than the name brands.
Think about it this way. When you need to get medication from the Doctor. Do you insist they only prescribe the name brand? Or do you take the less expensive generic brand? Maybe you don’t even know. Many doctors automatically prescribe the generic brands. So if you are willing to take the “knock-off” brands when dealing with your health, why not do it with your food as well?
For my family it has been trial and error. We will try most store brand products. And in most cases they are totally fine. We’ve found our favorites to be the Kroger brands from any of their many Store names such as Baker’s or Smith’s. We always buy our peanut butter, jelly, and syrup from there. As well as our multi-vitamins and ice-cream. Other things as well. In fact, our family prefers the taste and texture of the Kroger creamy honey and Chunky peanut butter over other name brands. We buy the sugar-free syrup and the sugar-free or low sugar & fat ice-cream and we enjoy those products very much. The best alternative for expensive Nutella is the Wal-Mart “Great Value” brand Hazelnut Spread. The only downside is they only have them available in small containers.
Buying store brand can save you HUGE. My preferred cereal is Bran Flakes. Just plain bran flakes. But then I add my own raisins and a little bit of honey. This is delicious to me and cuts way down on the amount of sugar that gets added when you buy raisin-bran cereal. But the cost for a box of generic bran flakes is usually around $2 per box. Sometimes less if they are on sale. Compare that with the same thing and really no flavor difference, of a name brand and it is about half the price. We do the same on the kids cereals and when possible get the larger bulk bags that can cut the price per ounce in half or more as well.
On Sale does NOT mean it is the best Buy
Just because something is on sale does not mean it is the best deal. Let’s take peanut butter for example. I often get a 12 ounce jar of Kroger peanut butter for around $1.50. A name brand will usually cost around $3 for a 12 ounce jar. It may be on sale for $2.25 or $2.50 but then when I look over and compare that with the store brand, I can still get the generic version cheaper and at a better value.
Do NOT Spend more to Save more
I know people who drive across town and go to multiple stores to get the things that cost the least at each store. I don’t do this unless maybe I am buying a lot of that on thing. My time and gas have a value. I don’t want to spend more of my time to go to another store and stand in another line just to save a couple bucks. This is also why I don’t like Black Friday. I will make a couple stops if the stores are in close proximity or are in my path to home anyway. For example, as mentioned I do go to a Kroger store to buy peanut butter, jelly, and Cheese. But if I only need cheese and I am already at Wal-Mart, I am fine with paying a little more for the cheese there to save myself the time and effort to go to another store.
When you are driving to multiple places to “save” money to be frugal, this is “Fake Frugality”. You are spending more thinking you are being smart and saving. If your time has no value, then you need to spend your time finding ways to add value to your life. Don’t waste it away.
You could even take it to the next level to save even more time and not buy things you don’t need. Many stores now offer free pickup or paid delivery. Simply make your order online and then go pick it up. I have not yet tried this but plan to do so soon. I will probably still want to go in the store for fruits and vegetables to pick out the ones I want, but think of the time you would save not wandering the isles and picking up things not on your list because they caught your eye. It may even be worth your time to pay a little more to have it delivered. You’ll need to compare the cost to your time savings to decide if it is worth it to you.
Teach your kids how to compare value
Be responsible for your own finances but also help teach your kids. Take them grocery shopping with you and show them how and why you compare the price per unit to know which is the better deal. Which one stretches your dollar further. Is it worth paying more for the 5 pound bag of shredded cheese that costs $11 instead of the 6 ounce bag for $2? What about the 5 dozen box of eggs for $4 instead of the one dozen for $1.50? Help educate your children or grandchildren so that they can be responsible stewards of their money. When they go off to college or live on their own, will they know how to live within their means? Did you when you were that age? Keep in mind, sometimes it is better to pay the higher cost per unit for a smaller amount if you won’t use it before it goes bad. With a large family things usually don’t stay around long enough to spoil. But if you are single or just a couple and don’t eat a lot, you may not need the 5 dozen eggs and 5 pounds of cheese. So make wise decisions based on your actual usage.
Challenge
If you are not already doing so, or even if you are, I challenge you this week to try something new. Try a generic store brand item and see what you think. There could be a slight flavor difference, but is that difference great enough that you HAVE to pay more for the name brand? I buy generic mustard and ketchup all the time. Yes, there is a difference in the flavor compared to a name brand, but not enough that I care to pay more for it. The generic ones still taste fine for me and my family.
So go out there and try something. Whether it be ice-cream, peanut butter, condiments, cereal, whatever, try it. You may find that you like it and by one simple act of buying cheaper items when you buy groceries, you may add in a significant amount of extra money each month to your budget by not overpaying for a similar item. Then take your receipts from when you did your last shopping buying all name brands and then compare it with an updated receipt after you’ve switched to mostly generic brands and see how much you save.
And the good thing is those savings keep adding up each and every month, it could save you hundreds if not thousands each year.