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How to Save Money: The Definitive Guide – Part 2

freeimage-10752841-webHi everybody. We’re back with the second part of our multi-week series “How to Save Money: The Definitive Guide.” As you may remember, we aim to encourage people to be creative in how they think about managing their biggest monthly expenses. Last week in Part 1, we addressed housing costs and transportation costs and suggested downsizing, sharing and/or renting as moderate ways to reduce costs without necessarily doing without the things you want. Over the coming weeks we will continue to explore those ideas over the next few weeks as they relate to other common large monthly expenses: groceries, utilities, telephone or smart phone service, internet service and entertainment options like cable, movies, books, etc.

What You Eat and Drink

Americans spend a lot of money on food. The US Bureau of Labor Statistics estimates that the average consumer (a 49-year old that makes about $63,000 a year) spent about $2,620 a year eating outside the home and about $3,838 eating at home in 2011. That comes to about $538 a month or about $124 a week. More recently, a 2012 Gallup survey found that its sample spent an average of $151 a week on food, though the median  of the sample was $125.

As you can imagine, eating out is usually way more expensive than eating at home–unless you’re risking your health on too many fast food “value” menus. As a consequence, I try to avoid eating out more than a few times a week, but that does not always work for my home or social lives. (Janet prefers restaurants over home-cooking.) I also get a lot of personal satisfaction from preparing food myself at home and I’m on a healthy diet right now that is best maintained through home-cooked meals, so I am doubly eager to do it. However, we’ve learned a few strategies to help reduce the overall cost of eating out. You can find them in Janet’s recent post called 6 Easy Hacks for Saving on Fine Dining.

There are other cost considerations when eating out or at home. Animal proteins–meats–are expensive, and seafoods (including shellfish) tend to be the most expensive of them. GE Miller over at 20SomethingFinance began saving thousands of dollars each year when he and his wife gave up meat entirely. However, if you want to reduce your spending on meats without giving them up completely, skip expensive meats like seafood, beef and lamb–especially in restaurants where these particular meats usually carry large mark-ups over wholesale prices. If you still want your lobster or fish or steak though, you’ll find that you can prepare them much more cheaply and healthily at home.

As for alcohol: While home-brew tends to be a very expensive hobby, the idea of drinking at home instead of at restaurants is sound enough. Restaurants and bars charge so much money for booze. It reminds me why everyone in college was so sensible about “pre-gaming” before going out! If you want to save money then, buy good stuff at the store to drink at home and only drink swill at bars and restaurants if you must (and ideally on special).

Joking aside though, when it comes to reducing food and drink costs, a little planning, a little sharing and a little avoidance can go a long way toward saving you money. If you plan your grocery shopping so that you can make multiple meals (including leftovers) with the ingredients you buy, and you share the costs of the food with friends and loved-ones who join you, you can save thousands of dollars each year and even have a lot of fun making meals to enjoy together. (It helps too if you avoid the most expensive meats and ingredients.) And, if you’re the type who plans far ahead or who buys the same groceries each week or month, you also might want to consider a bulk subscription option through your local Community-Supported Agriculture (CSA) or Amazon Subscribe & Save.

Stay Tuned for Part 3 Next Week

As you can see, there’s a lot to consider when trying to save money on this major regular expense. There’s more to come though, as we address other common large monthly expenses including home utilities, telecommunications and entertainment in future posts. Until then, keep fighting the frugal fight.

How do you save money on food? Share your tips, strategies and experiences in our Community Forum!

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