Spending Money can Be Expensive

spending moneyI’ve wrote about how saving a significant amount of income paves the road for financial independence. It may not happen overnight and sometimes I have a hard time grasping that. I want to get there fast, but cutting corners could set me back along the way. Therefore, I look for ways to be patient and let things run its course. Saving consistently over time is an inevitable way to reach financial freedom. However, on the other side of savings rate is looking at what you’re spending money on. Monitoring your expenses and spending is just as important as monitoring your savings rate.

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I’m constantly looking for ways to save, even if it’s a little a day. Cutting expenses by a dollar a day is an enormous $365 a year that I save. That pays for 2 months worth of car expenses (insurance and gas). Therefore, saving a few dollars here and there is powerful. For example, I normally spend $35 – $40 a week eating out for lunch, which is a whopping $1680 – $1920 a year that I spend on lunch alone.

Not food costs, just lunch. This isn’t including dinner,breakfast, or eating out in a restaurant occasionally throughout the month. My income is $55,000 a year, if I save $1680, it’s an increase of 3% in my earnings at my disposal. I sure could use that money! 

Valuing Your Money Spent

I’m a proponent of using time and money to your advantage, not detriment. Eating out for lunch saves me time to the alternative of making lunch the day before. The sacrifice is that I have to spend money to save the time. If I actually put my earnings into perspective, I could knock out a sandwich in 15 minutes and add fruit to bring to work the next day.

It probably costs me $1 max to do so. So if I spend $7 for lunch vs the alternative of spending 15 minutes and $1 to make it, that means that the 15 minutes I spend is worth $6. That’s $24 an hour that I’m spending! It’s pretty darn close to how much I make at work per hour.

I can’t say that spending money on Chipotle is equivalent to one hour of me working. Therefore, I feel like I’m overpaying for the services I’m getting. I don’t want to overpay, I want to underpay and get more than what I pay for. So I adjusted and started bringing my lunch to work.

I can proudly say that I didn’t use any money for 5 days straight (from Saturday September 3rd to Wednesday September 7th). Watching my bank account go up has been rewarding, to say the least. It’s been working  wonders in cutting my expenses. I also have a $30 a week budget for going out / miscellaneous expenses.

I’ve never hit that limit so far and that’s just extra money that I can use to invest. Investing is a huge passion I have because it’s so competitive and real-time. It’s my analysis vs another person’s analysis and that gives me more joy than passing my going-out budget. 

Watch What You’re Spending Money On

One of the reasons why it’s so hard to save is because of lack of monitoring. There are numbers that are essential that you should know from the moment you wake up. How much you can spend per day, what percentage of your income you need to save to retire in x years, how much time you want to spend working, working out, or relaxing, etc.

Without a plan, there’s no direction. Without direction, it’s hard to get to where you want to go. This is one of my biggest regrets in my college days. I was hustling and bustling 100 miles per hour to get to where I wanted to go. But I didn’t review my goals to make sure the direction is the right one.

There’s multiple avenues of where my money’s going that I’m tracking. I’m tracking how much I’m spending money on electricity, gas, food, and miscellaneous expenses. I always add in an “miscellaneous expense” category to my budget because for 1) I need a cushion and 2) life will never pan out exactly the way you plan.

There always seems to be something that I spend money on throughout the month that I never plan out for. This month was a battery and a coolant cap for my car. Next month will be something completely different. 

3 Ways Expenses Can be Cut

Use Less

I know a couple of friends who leaves the AC on even when they are at work. They also leave power plugs left in the power plugs even when they’re not using it for the next couple of days. I unplug my microwave power plug before I go to work and unplug unnecessary plugs that I know I won’t use for days.

Believe it or not, leaving plugs on actually uses electricity, although by little. I spend $33 a month on electricity by using around 140 kWh (Kilowatt hours). According to the EIA, the average usage in the US is around 911 kWh per month. I try not to use electricity if I don’t need to.

Use Cash Back Websites

I absolutely ADORE cash-back websites. I use Ebates whenever I’m doing online shopping to make sure that I can take advantage of deals. Ebates is a cash-back website that gives you cash back for things that you were going to spend money on anyways. The savings can be small or huge, ranging from 1.5% cash-back to 21% cash back.

I used eBates to purchase my website on Bluehost which lowered my cost from $46 for the year to $36 for the year. If I add in a 2% cash back that I get from my credit card company, that’s savings that I just can’t ignore. To date, I’ve gotten $147 in cash back, which is money that I wouldn’t have seen otherwise.

They do have a $5 minimum threshold before you can get paid in Paypal or check, but I think it’s worth it. If you join eBates they also give you a $10 bonus just for signing up. You’re getting paid to get paid more, it’s a great service that you should take advantage of!

Look for Alternatives

The great thing about business is that there’s ALWAYS more than 1. There’s more than one way to get the value or utility that you are looking for. If you’re looking for a phone, there’re Google, Apple, Samsung, Microsoft, and many others who are competing for your hard-earned dollars. For lunch, you can always pack your own instead of going out. 

If you’re looking for buying in bulk, there’s Costco, Sam’s club, BJ’s Wholesale Club, and many more. This doesn’t just apply to products, it applies in investing as well. There’s always more than one company doing the same or similar thing to another company. Escaping competition is hard and not prevalent these days. A patented product can easily be loopholed around it.

The lesson in all of this is that doing your research can reward you. Looking at alternatives is time consuming but the money and headaches saved can be well worth it. With the internet, it’s not as time consuming as before but you still have to know which resources to look for, which sources to trust, etc.

Remember, you’re the one spending money, you’re the one with power. Looking for ways to increase that power even further helps with your bottom line and get the most bang for your buck.


Tracking what you’re spending money on is becoming essential. You can’t afford to not know where your money is going. Looking for ways to use less, using a cash-back earnings website like eBates, and looking for alternatives can be a great way to save a little extra cash. Not spending any money for a week is a different thing that what I am used to doing, but after a while I’m sure it will be second nature to me. The more I’m used to doing it, the better I’ll be at cutting expenses!

Readers, what’s your guide to spending money? How do you look for ways to save? Let me know in the comments below!

Finance Solver

I grew my net worth to $40,000 as a college student through hard work, discipline, and a little bit of luck. I graduated college in 2016 and will be starting to plan for my retirement once I start working.I am planning on reaching financial independence by my early 30's and I will document my moments of inspiration all the way to desperation here.

My goal is to enable your success in personal finance so that you can realize the American dream. The first step is starting today!

Read more about me here.

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14 thoughts on “Spending Money can Be Expensive

  1. That’s great that you didn’t spend any money for few days! A few no-spend days each month really adds up. And kudos to you for taking your lunch!

    As far as prep time for lunches goes, last weekend I made a couple of big batches of fried rice and pasta for my husband and daughter to take for lunch all week (so we didn’t have to prep lunches each day). Batching preparation of lunches saved me a ton of time this week!

    • Finance Solver says:

      Thanks Amanda! This week also, I spent 7$ eating out for lunch and packed a lunch for the other 4 days. The company also took us out to lunch a couple times so that helped a lot 🙂

      I’ve been thinking of batching my lunches to save even more time. I have to add some extra recipes to my arsenal because I don’t think I know a lot of recipes that I can cook for the rest of the week. The joys of being a bachelor!

  2. Buying lunch at work is a pet peeve of mine as well. At the cafeteria it will cost me around $8 and if I make it myself it will cost $2. Not much of a difference, but over the course of a year it adds up. I also save a few pounds as well since the lunches I pack are always healthier than what I would buy.

    • Finance Solver says:

      Yep! I like to call it a triple advantage. You get to learn recipes, eat healthier, and save money. The cost is time, but spending one thing to get 3 things of great value I think is so worth it. My friends do judge me for bringing lunch to work but I have no regrets!

  3. I love the title of this article, it made me smile.

    Great article, condensed the principle of being frugal pretty much. Great job on switching out your purchased lunches for making it yourself. Considering your dollar-per-hour whenever using a product/service is a great way to decide if you should DIY it.


    • Finance Solver says:

      That’s awesome! I hoped that my titles were good enough :p I didn’t really know how much I was spending on lunches until I took the time to figure it out. I love chipotle and all (fun fact: I ate Chipotle for 6 months straight twice a day in college, good times!) but I want the optionality to retire much more. I’m getting close to minimizing the expenses that I can control so the next step is to raise the income level a little!

  4. I love the thought process about your lunch. Really a smart way to think about the value of packing your lunch versus buying.

    And we love finding ways to trim our electrical bill: Adding a programmable thermostat, flow restrictors and low flow shower heads, power strips you can turn on and off on most electronics, and turning down the hot water have shaved a big percentage off our bill without changing anything in our lives but what we were paying!

    • Finance Solver says:

      Thank you! I like putting a dollar value to time because it helps me actually feel the time I’m giving up to obtain the product or service.

      Whoa those are really creative ways to doing so! I haven’t ever heard of those tactics ever in the vast world wide web. I wish my apartment allowed for a programmable thermostat, the AC that they have is a manual “turn on for cold air” 🙁

  5. My wife is amazing at shopping deals at the grocery store. She almost exclusively buys things on sale and buys them in bulk. While our freezer is usually chock full we never run out of food.

    Before I got married I use to spend $500 on groceries a month. I use to go once a week to the grocery store closest to my house and buy whatever I wanted.

    My wife however checks the four grocery stores sales ads close to our house and circles the items she is going to buy. It normally takes her about 20 minutes to plan for the week. But now that I’m married with a child we now spend less than $500 on groceries and it’s higher quality food plus we’re eating in a virtually every meal.

    • Finance Solver says:

      I haven’t figured out how to shop deals in the grocery store yet. I usually go to really discounted grocery stores (I almost exclusively only shop at ALDI’s now) and take advantage of the 3% cash back that I get from my credit card (they upped it to 6% cash back for the remainder of the year, so I’m going to be pouncing on that).
      I probably spend close to $300 on food costs a month, where I think around $230 of that goes to groceries. I buy so that I only have to go once every two weeks.
      Wow that’s fantastic and your wife sounds like a kick-ass gal 🙂 next to housing and taxes, food I think will be someone’s biggest expense so it’s great that you’re minimizing your expense in it!

  6. Hey FS,
    Very good points, you probably will notice that once your mindset has (completely?) changed most of this becomes automatic. For us this has become a second nature, to the point that we actually (specifically me) need to be careful you still do spend some money on the items that provide you with a benefit (joy, health, etc.). But “wasting” money is never a good idea.
    Good luck!!

    • Finance Solver says:

      Thanks TeamCF! After a while, it becomes a habit and I don’t even think about it. Recently, I’ve been having trouble looking for areas to SPEND money because I’ve been so conditioned to not spend on things that I don’t need. A good problem to have!

      That’s awesome! It takes maybe 2 – 3 months before it becomes second nature, and it sounds like you’ve figured out how to make it second nature.

    • Finance Solver says:

      Yes! Saving is so out of the norm culture in America but once I started caring only about my savings and not other people’s savings, my bank account started to swell up as I routinely made it a habit. I remember that I bought impulsively last week but I was consciously looking for a way to spend and reward myself for 3 months well done of saving 50%+ pretax. Thank you for leaving all of your thoughtful comments!

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