Frugal Living 
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Find Actual Savings, Not “Savings Theater”

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If you want to save money, there are a few tried and true techniques that almost every personal finance expert will tell you. Brown bag your lunch. Make your coffee or tea at home. Cut the cable. The list goes on and on and on. The “hardcore frugalists” might go as far as to suggest splitting two-ply toilet paper or cutting open your toothpaste container to get that very last bit (I don’t do this now but I would consider it on the basis of just not wasting it, not to save money).

Unfortunately, while those savings are nice, they don’t impact your financial life as much as they appear based on sheer effort. A lot of them take a significant amount of effort for a less than significant amount of savings. While that’s obvious for those tips like splitting two-ply toilet paper (yes, I’ve seen that suggested before), it’s less obvious for the suggestions to brown bag lunch every day or make your own coffee.

The perfect analogy, and I apologize if this sounds cynical, is TSA security at airports. As a result of 9/11 and security concerns, we now have to go through a long annoying process to get through “security” at airports. It’s security theater.

Are we more secure? Their own testing shows that the security checkpoints can be defeated. Other lapses in security can result in a recent parolee just sneaking onto a flight. We pay billions for this but does it make us safer? It’s hard to say and an expensive tax on our system.

As an aside, I personally have no problem with it until they started using those useless body scanners, which subject you to radiation (you can argue whether or not the radiation is dangerous but all I know is that I’d be subjected to less radiation, harmful or harmless, if I didn’t have to walk through that scanner). I just wish I bought stock in the company that makes those scanners and the people who convinced us we need backscatter x-rays.

Where can you focus on real significant savings? Here are a few quick suggestions:

  • Review insurance policies – You can save hundreds of dollars a year with a simple phone call or internet inquiry. If you’ve had a recent life change, such as marriage, divorce, or move, you might find a much lower rate. Just stick with a reputable insurer, don’t go with a no-name company offering cut-throat rates.
  • Check your investment fees – Check the fees you pay for any investment accounts, retirement and non-retirement. Over many years, just a few tenths of a percent can mean thousands of dollars to a broker, rather than to your nest egg.
  • Renegotiate fixed costs – See if you can do better on the rates you pay for things each month like your cable bill, internet, and others. Armed with a competitor’s flyer, you could find yourself paying much less.

Focus on real savings and not savings theater.

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8 Responses to “Find Actual Savings, Not “Savings Theater””

  1. Big wins are always great but changed habits shouldn’t be completely discounted either. If you do change from eating out for punch every day to brown bagging every day there is a big savings. Just don’t ignore the big wins like saving thousands on your next car. Each has its place.

  2. Pete Weiss says:

    This article would have been even more useful if it listed more items and gave real-life cost (time/effort and $) savings, based upon realistic numbers.

    Being frugal is not always about spending the minimum amount for one thing at a time. Sometimes, there is great pleasure and psychic reward in spending money e.g., sharing a cup of coffee with friends or colleagues.

  3. I love the gist of the article. Here’s the granddaddy of them all: save $50,000 by waiting to buy your first house (or to trade up) until the next recession. We all know house prices go up and down, and a recession is when they’re at their lowest.

    This sounds easy, but it’s not. It’s hard to resist when money is easy and “everyone” is either buying or capitalizing on their higher home prices to trade up. It’s equally hard when everyone is whining and moaning in a recession about how bad an investment a house is because “just look at how prices have tanked recently.”

    Warren Buffett famously said he gets scared when others get greedy (high prices) and he gets greedy when others get scared (recession).

    If I save $50,000 on buying my house, I feel less bad about the last squeeze of toothpaste, although I will confess that (like you) I hate to waste it. :)

  4. mike says:

    Call your cable company every six months and ask to speak to the RETENTION DEPARTMENT!! Ask what deals they currently have for existing customers, have your account number near by to give them and let them do the talking. I save more every 6 months and with the competition it is easy to save. I just got free six months premium movie channel and $20 off a month for a year because I have internet and an HD DVR!!

    • Pete Weiss says:

      I echo this advice and it is SAD that one has to play this game w/ Thee Cable Company.

      Also, there may be a difference between calling the toll-free telephone number and what is offered through the local cable office. [I just found this out the hard way.]

  5. Dave says:

    Buy used cars.
    Refinance your house for 3.5%.

  6. suresh says:

    80/20 rule to be implemented to know the major expenses and drive towards knowing true savings.


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