Wednesday, May 20, 2009

You Cannot Time The Market - The Supermarket

Saving Money Tip #142 - You Cannot Time The Market - The Supermarket. On the trek to being more frugal and putting away more money, one can sometimes get obsessed with getting the lowest price on everything, doing things the cheapest way all of the time, and never overpaying for everything. But this is simply not a good way to go about saving money because psychologically you will lose.

You should strive to get the best deals most of the time and you should try to look for the cheapest way to do things most of the time. But buying things at the cheapest price all of the time is not necessary or even practical. There is no way to get the cheapest price on everything all of the time. Gas prices change sometimes hourly, it seems. Food prices fluctuate on a weekly basis and housing prices…well forget housing prices.

My point is on a regular basis, you should strive to pay the least amount on your food bill, but if you overpay for milk one day because you are in a higher-priced supermarket, who cares? It won’t mess up your financial plan. And if you buy gas for $2.29 per gallon only to find the next day it has dropped to $2.09 per gallon, you may feel like kicking yourself. Don’t. It’s not worth it. And all of that research you did on the new dishwasher you bought only to find out the price has dropped $30 a month later. Forget about it.

No one is perfect in this financial game. Just like no one can ever time the stock market perfectly, neither can we time the supermarket, the gas station, the electronics store or any other retail store just right. If you are getting the best price most of the time, then it is okay to overpay for Tylenol in the middle of the night for your sick child. If you are consistently beating your grocery budget, then it’s okay to buy that bag of chips you really want, even if you don’t have a coupon. And if you buy something at what was the best price at the time, don’t beat yourself up over it if you find out the price has dropped months later.

Yes, you should strive to get the best prices on a consistent basis, but it’s impossible to be perfect about it. Instead, when you overpay for something, you should feel good about it, knowing that you can afford to overpay once in awhile because you buy so well the rest of the time.

In Real Life (IRL) –
I needed canola oil yesterday to make cupcakes for my daughter’s class. And generally I have found that Costco’s prices beat my supermarket’s hands-down on most baking products. Problem was, I have taken for granted that my husband can stop at Costco any day after work, so I don’t bother to keep my kitchen well-stocked in these things. Unfortunately, my husband didn’t work in the office yesterday, and I needed to make the cupcakes last night. So I stopped at the local supermarket and bought my canola oil. Yes, I am sure I overpaid for it. I got the best deal I could find at that store, but it wasn’t as good as I can do at Costco.

And you know what? It doesn’t make a darn difference. There are people out there who overpay all of the time. They do not research prices and compare supermarkets and warehouses to find the best prices on items they buy regularly. But I do. And over the course of a year, I probably save hundreds of dollars because of it. So, if once in a while, I overpay for an item by $1, it doesn’t come close to messing up our budget or ruining us financially. I am paying for the price of convenience sometimes. And on an infrequent basis, it doesn’t matter. If I did it on a regular basis, it would be a different story. I try not to get hung up too much when I pay too much on something because I feel like my frugal lifestyle affords me the benefit of overpaying once in awhile.


Gina @ The Shabby Chic Cottage said...

I agree 100%! At some point wasting time searching around to save $10 doesn't really make that much of a difference. Think about your time being as valuable as your money. Doing my best at whatever moment is something I'm working on.

Edi said...

Yes - there are people that are "nickle and diming" themselves to death! You need to consider the time and effort expended into the cost of an item. Sure you could drive the extra 10 min to get the cheaper oil but then you'd spend whatever you might save, in gas dollars.

I use coupons when it's practical and I find them easily - otherwise I just shop at the cheapest grocery store and consider that "good enough".

Poker Rooms said...

On your place I would not do it.