Savings Assumptions

There are times when we do things that we think are saving us money when they truly aren’t. Many times it’s because we only look at the surface and get into a habit without sitting down and working out the truth. I often harp on these issues. It doesn’t make sense to drive clear across town to save a few cents on gas because it costs more to drive the extra distance than what you save. The same thing can be said about driving all over town to save a little on groceries. It doesn’t pay to save money in a jar if you take it to the store and pay 9% to have it counted by a Coinstar machine. In all these cases people think they are saving money, but in reality it ends up costing them more.

Even I fall into this trap from time to time. The following is a good example that I did for years without thinking it through.

I sell items that need to be sent so what I did for years was pick up boxes at the grocery store for free with the assumption I was saving money since I didn’t have to pay for them. I would often look at the padded envelopes at the store and think how much more convenient they would be to use instead of wrapping the boxes each time, but they cost $0.60 to $1.00 each and when I was sending out over 100 items a month, that adds up.

When I started spending more time on my sites, I had to find more time so I caved in and began buying the padded envelopes since this saved about 10 to 15 minutes wrapping time for each package I sent. As soon as I began, I wondered why I hadn’t been doing this from the start!

(this envelope saved both time and money when I assumed it would cost me)

What I found was that because a lot of the cost in sending the items I sold was in the weight of the boxes I had been using, sending the items with the padded envelopes was significantly less – $1.50 to $2.00 less in most cases. What this meant was that I could lower the cost of my shipping, still cover the cost of the envelopes and save a ton of time all at the same time. In addition, I’ve never had an envelope lost in the mail (knock on wood – I assume because the envelopes are a bright yellow) while several of my packages went missing.

This is just another example that shows that you do need to examine all your habits to confirm what you assume is saving you money really is.

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3 Responses to Savings Assumptions

  1. beloml says:

    The same is true of dog or cat food. Cheap food turns out to be expensive because it’s so full of fillers that your pet has to eat more. Plus, the poop stinks and your pet is less healthy (and happy), meaning much higher vet bills down the road.

  2. Pingback: frugal underground » money: saving more, making more, enjoying more, needing less » Blog Archive » Carnival of Debt Reduction #5

  3. HenryBemis says:

    This is the very heart of frugality. Not being cheap or stingy or having an unwillingness to consume less, it’s about being wise, in your purchases. Frugality is about deep thinking, reasoned thinking.

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