When you go shopping are you prepared? A few extra steps and seconds could save you thousands of dollars each year.
Making a list is pretty obvious when you are going grocery shopping. However, have you ever thought about doing it when you are buying other items? A number of studies have proven that making a list of items when grocery shopping saves you money. This same principal can be transferred to any shopping spree.
The reason people spend less with a list is that it helps them avoid looking at other items. When you are going for a new pair of jeans, do you swing by the home decor section to see if they have any deals? If you do then start making a list and stick to it. You will almost immediately see you start spending less.
Also, if you do not have any reason to go shopping then don’t. Many people (myself included) go to a store just to see if they have anything nice or any great deals. The problem is, in most cases, when you go window shopping you end up buying something. Unless you have room in your budget for this, every time you buy something spontaneously you are messing up your entire budget.
The Price Cap
Now that you have a purpose for being in the store you need to focus on the price. Something I have been doing for years is putting a price cap on my shopping excursions. This allows me to accurately budget for items and easily stay within budget.
For example, if I am going to Kohl’s for a polo and a pair of jeans I might budget myself to spend $30 for that trip. This could be $10 for the polo and $20 for the jeans or $25 for the jeans and $5 for the polo. The item cost doesn’t matter as long as I purchase both items and stay within budget.
In addition to a max for my entire shopping trip I also put a maximum price on each item. However, I do not just use any random price for the item maximum but rather an unbeatable price. Therefore, if the average price of a pair of jeans is $20 then I will budget $15 for the jeans.
Many people I tell this trick to think I am crazy. However, setting a low price threshold prevents me from buying at any random time or at any random price. For many people when they need a new item they go and buy one. For me I am instead always on the hunt for the best price.
Therefore, if I tear a pair of jeans in May I might have to wait until back to school season to pick up a pair. The benefit of waiting though is instead of buying one pair for $20 I will probably score a BOGO deal and get two for the price of one.
This single trick has saved me over $10,000 in my lifetime. When you use this trick you either leave behind items because they aren’t a “good” price or you score a huge win and save yourself money. If you leave behind the item, don’t worry you will either find you didn’t “need” the item or you will find a better deal eventually.
Your Financial Freedom Partner,