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How I Saved $1.53

I was at the grocery store and instead of buying my usual brand of sandwich bread, I bought a different kind that was a little bit cheaper. Savings: $1.53. Booyah!

one fifty threeThen as I passed by the candy aisle, I saw some Milk Duds. Mmmmmmmmmmm.

I thought, “I just saved $1.53 on bread… I should treat myself to some delicious chocolate-caramel candies that will get stuck in my teeth and make me fat.” Bye bye $1.53 of savings.

There is a Difference Between Not Spending and Saving

Okay, so none of that stuff actually happened. When I go grocery shopping my girlfriend puts stuff in the cart and I pay for it. I try to buy things on sale when I see some deals, but in general my grocery bill is usually about the same every month.

If I save $1.53 on bread, but spend $1.53 extra on candy then I haven’t really saved anything. If I save $1.53 on bread and am cost conscious in all my other purchases then I’m closer to saving $1.53, but I’m not quite there yet.

Until that extra money makes it’s way to paying off debt, a saving account, an investment account, a small business venture, or something else then you haven’t actually realized the savings. Money saved on one thing and spent on another non-essential item isn’t money saved at all.

You Need a Purpose for Saving Money

There are two stages of spending money. There’s the “keep the lights on” spending (place to live, food on the table, transportation, etc) and there are higher purposes (saving for retirement, starting a business, travel, buying your kid a horse, a $200,000 racing pigeon).

Your higher purpose is up to you. Some people want money for retirement and some people want a racing pigeon. Your goal doesn’t matter.

What matters is how well you minimize your “keep the lights on” expenditures and maximize the money to goes towards your personal higher purposes. If you save money on food at the grocery store and spend more on food at McDonalds, you haven’t saved anything extra towards your higher purpose.

Think about that next time you “save” money. First, are you really saving that money or are you spending it elsewhere? Second, what’s the end goal of that $1.53?

Readers: What is your end goal whenever you save a buck or two?

27 thoughts on “How I Saved $1.53”

  1. TB at BlueCollarWorkman

    I dont really even want to click on the link for the $200,000 racing pigeon because… seriously, wtf? lol. My wife has us on a budget and I know how much I can spend each month on coffee, mountain dew, and tools; I don’t really try to spend more than that or save more that, I just stick with that. And in the end, in about 5 years, our mortgage will be paid off. 🙂 How awesome will that be??!

    1. Wow, congratulations. I think true home ownership (no mortgage) in a low property tax area has to be the apex of financial freedom.

  2. Emily @ evolvingPF

    It’s a difficult habit to break, but I’m trying to switching in my writing from using the word “saving” to “not-spending” or “spending less” when discussing the kinds of things you outlined. It’s not saving to me unless it’s money that actually gets transferred into a savings account or investment.

    1. Do you have a set amount that gets transfered to a savings account every month, or do you just move whatever you have saved up every so often?

      1. Emily @ evolvingPF

        We have set amounts that we transfer each month to our IRAs and to our targeted short-term savings accounts (car, travel, etc.). Then, at the end of the month, we transfer what’s left to our general savings account or to the targeted savings accounts.

  3. Maybe every time you “save” $1.53 you can take that cash money to a zip lock Baggie that is labeled “gross savings” then add it to a payment at the end of the month. Idk if that’ll work but I’m going to try it.

    1. Sounds like a good idea. There are also bank accounts you could use to transfer that money into a savings account immediately

    1. I probably won’t do that, but I can try to convince my girlfriend. She makes a mean banana bread.

  4. Jeff @ Sustainable Life Blog

    my end goal for my savings is to buy a rifle. I’ve been putting it off for 3 years!

    1. One of my goals is to get a handgun and a shotgun. I’ll hopefully get both by the end of September. Good luck getting your rifle.

  5. Bethy @ Credit Karma

    “You need a purpose for saving money.” – Yes. Nail on the head. I find that I stink (not literally–figuratively) at saving money unless I have a specific goal. And I’d much rather set a realistic grocery budget (which I do) than hem and haw over this loaf of bread vs. that loaf of bread.

    See you at FinCon next week?

    1. I’ll be there. Make sure you’re there on Thursday night for the Plutus Awards! I’m hosting it this year!

  6. I’ve been thinking about this very concept. For example, making I’ve coffee at home instead of spending $5 a day elsewhere. So when I don’t buy coffee, I will try to remember to move the money I would spend into my savings account so that it can begin to add up.

    1. $5 every weekday is $1,300 a week. That is a pretty significant chunk of money. Makes you wonder what would happen to Starbucks if just a small % of their loyal customers quit cold turkey.

  7. Jacob @ iheartbudgets

    I call this “give your money an identity.” I agree, savings are worthless unless they are doing something!

  8. Great post! I agree completely. You have to have a main goal in mind. That $200,00 pigeon is hilarious. You know what? That’s going to be my money saving goal from now on. Just have to get the husband on board. Hmm….

  9. I’m working on building a financial empire one penny at a time (Insert evil laugh). Listen closely…Do you hear that? It’s my favorite sound, the sound of interest accruing. My goal is to pass on the empire building drive to my daughters.

    When I ask my 5 year old daughter, “Honey, do you hear that”, she replies, “is it a baby penny being born?” “Yes, honey, a new baby penny just hatched out of it’s egg in your internet savings account”

    I now have my 12 year old daughter set up with a Roth IRA funded by her babysitting income. I tell her that her dollars are like marines on the battlefield, sometimes they make gains and sometimes they take losses, but like Marines they will continue to advance until they are victorius.

    Anyway, it seems to make things fun for the girls.

  10. Anne @ ImpulseSave

    Awesome post! I usually squirrel away these small savings for travel (mostly so I can splurge on food when traveling).

    No matter the goal, you hit the nail on the head by pointing out that unless you move that money out of your normal cash flow, you’re not really “saving” it. I don’t have a lot of discipline, so if the money is out of sight, it’s also out of mind.

  11. Early retirement is the motivation behind all my saving. It’s a pretty vague goal but when broken down into maxing out different retirement accounts and setting annual checkpoints, it keeps me motivated.

  12. Great post! I’m constantly saving a buck or two here and there, but it quickly gets funneled to my homing pigeons. Thanks for pointing it out. Now I can focus on throwing savings into savings!

  13. Kathleen @ Frugal Portland

    haha do they still make Milk Duds? Found money, for me, always goes to the debt-of-highest-concern. Which is student loans, right now. So, if I transfer from PayPal to my account, I take that exact amount out of checking and to the student loan. If I don’t, then, whenever PayPal gets around to it, the money will get deposited and absorbed.

  14. Kris @ Balancing Money and Life

    Having a goal for savings is so important, but I love your point that not spending is still not saving. My husband always wants me to transfer the money I “save” at the grocery store to our savings account; I always point out that those savings are already built into my grocery budget because I don’t buy products unless they are on sale!

  15. Paula @ Afford Anything

    Years ago when I was saving up to travel, I’d walk through the grocery store, do my normal round of shopping, and then right before checkout … I’d put a few discretionary things, like juice, back on the shelf. I’d calculate how much I “saved” by not buying those items (say, $6). Then I’d remove that amount from my wallet and stash it in my glove compartment. Over time it added up to hundreds of dollars.

    But it also taught me the same lesson you discuss here — its not savings til you save it. Otherwise its easy to spend that same money on something else.

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