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Frugality is an approach to managing personal finances that focuses on saving money through smart choices. To be frugal, you need not always opt for the lowest cost, but the best quality for the price. Consumerism Commentary offers many frugal living tips.

Frugal Living Tips

Frugality is an approach to managing personal finances that focuses on saving money through smart choices. To be frugal, you need not always opt for the lowest cost, but the best quality for the price. Consumerism Commentary offers many frugal living tips.

A flavorful life doesn’t have to cost a fortune. People who enjoy cooking and baking can often feel overwhelmed by the cost of groceries. Millennials get a lot of flak for their love of pricey avocado toast and other expensive culinary habits. However, the reality is that even just buying groceries for simple meals can add up quickly if you don’t pay attention to what you’re grabbing in the store aisles.

How to Save Money on Groceries

The good news is that there are some very simple tips you can follow to bring down the cost of groceries. Thinking outside the box can help you to put more food in your grocery bag without going broke. Take a look at four unconventional and creative ways to cut your grocery budget without skimping when it comes to flavor or quality.

Install a Calculator App on Your Phone

Do you hate being surprised by your grocery bill once you get to the register? You can add up your spending as you go if you download a simple calculator app to your phone and start tallying your bill while you shop. This will give you a good idea of how much is left in your budget to splurge on some extras while you’re shopping.

It will also give you the opportunity to put things back or shop for bargains while you’re at the store if you discover that you’re filling up your cart beyond your budget. This may help you to get creative with putting items in your cart that can make some tasty, satisfying meals that don’t cost a small fortune per plate.

Coupons Still Have their Place

Couponing is still in, and some shoppers can pay almost nothing for a cart full of groceries. If you buy the Sunday paper, you can clip your way to hundreds of dollars of savings. But remember, you should only clip coupons based off your shopping list, and don’t buy items just because you found a coupon. If you don’t want to buy the Sunday paper and clip coupons all day, you now have a high-tech option. There are plenty of coupon apps available for iPhone and Android users.

With coupon apps, you will never forget your coupons at home, and you can organize them with ease. One such app available with Android and iPhone devices is Coupon Sherpa. Available for Android devices, Grocery Smarts Coupon Shopper allows you to cross-reference all available coupons with current circulars, which allows you to get the best deal.

One popular app for Android, Shop Calc, allows you to create a pre-set budget and generate a realistic shopping list. iPhone owners should check out the Our Groceries Shopping List. The app allows shoppers to easily share shopping lists with others in the household, and organize items by category.

Avoid the Middle Section of the Grocery Store

The path you take through the aisles of your grocery store can actually determine how much you spend and how much you eat. The perimeter of a grocery store is where you’ll find fruits, vegetables, dairy products and freshly baked goods. These are the areas you’ll want to focus on if you need to purchase foods that will give you the biggest benefits for your bucks.

The middle of the store tends to contain more processed foods. It’s also where you’re likely to stock up on some sweets and impulse purchases that might not contribute to your plan to eat well on a budget. Only dip into the middle section if you need specific dry goods.

Knowing how to navigate your way through the interior aisles of a grocery store once you do step foot in them can also help you to save money. For instance, spices are often less expensive if you grab them from the ethnic food aisle of a grocery store instead of from the actual spice aisle.

Shop for Batch Cooking

Focusing on buying ingredients for making just two or three really good meals per week could help you save money. Batch cooking involves making big batches of meals you like and enjoying them throughout the week. You will typically make all of your meals at the start of the week and slip them into the freezer to be available throughout the week.

For instance, you could purchase ingredients to make lasagna that will stretch for two or three days. This often ends up costing much less than trying to invent a new meal for everyday of the week. What’s more, you’ll save so much time because you’ll be cooking all your meals at once.

How long one meal will last will depend on how many people you need to feed in your household. You can expect to save money whether you’re cooking for one or feeding a large family when you shop for batch cooking.

Go to the Store Less Frequently

You can’t be tempted by impulse purchases at the grocery store if you’re not at the grocery store every day. While the idea of stopping at the store every day to pick up fresh ingredients for meals sounds good, the reality is that it can easily lead to overspending.

It might be a good idea to change your habits if you’re the type of person who always pops into the grocery store after work to pick up ingredients for dinner. It’s hard to actually get a grasp of what your total weekly or monthly grocery budget is if you’re constantly making small purchases here and there.

Try to get in the habit of setting aside one day per week for grocery shopping for a little while to see if it becomes easier to manage your food spending. You can even make a habit of stockpiling specific ingredients when they go on sale to ensure that you always have what you need to make meals.

Use the Right Credit Card

Using the right cash back credit card can also help you save. The Blue Cash Preferred® Card from American Express, for example, pays up to 6% cash back on groceries. If you shop at Costco or Sam’s Club, they both offer cards with excellent cash back on purchases at their stores. You can find a complete list of the best cash back cards here.

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The concept of the Latte Factor is one of the most divisive in personal finance. Money gurus get so worked up over whether the Latte Factor is a valuable lesson in money management, that one might think the issue were as important as the national debt. Most of the time, passionate responses pertaining to the Latte Factor are based more on book sales and page views than any rational consideration of the issue, though.

latte

The Latte Factor is a term coined and trademarked by financial author and guru David Bach. He posits that small, repeated savings — of which people can make into habits — can aid the growth of wealth over time. The math supports this as truth: Assume you spend five dollars every weekday on a fancy, coffee-related drink on the way to your office. Now, imagine you cut out the coffee, or replace it with a $1.50, less-fancy drink. You would save at least $20 a week, or about $1,000 a year.

Take it a step further and put that money in a bank or invest it. Then, assume that you can earn a return from interest, dividends, or investment gains on that cash. Over the next ten years, you’ll have somewhere in the neighborhood of $15,000 more to your name than you would have, had you continued buying your daily gourmet drink.

Take it a step furtherLatte Factor Coffee

This concept isn’t limited to expensive coffee-related drinks, though. Any habits that result in spending money that could be deemed unnecessary can qualify for elimination due to the Latte Factor. Cook your own food rather than dining out once a week, and you could save just as much money (or more) over the same period. Cut out your premium cable package in exchange for Netflix or Amazon Prime streaming, and tuck that cash away.

Most people, however, don’t bridge the gap between reducing spending in one area and increasing savings with the difference. Unless there’s a concerted, conscious effort to transfer money from a checking account to a savings account or an investment, the money formerly spent on lattes or other repeatable expense will often just be spent on something else.

Furthermore, families that have already reduced their spending due to personal or economic situations may not have much room left to scrape the barrel. Finding additional savings can be too much to ask.

Yet another criticism of the Latte Factor is that it minimizes the importance of reducing large expenses. If a family gets into the habit of saving money ordinarily spent on lattes and uses that attitude to justify buying a more expensive car, all the work will have been for naught.

Well, I take that back: the work would have been for a more expensive car. But, in my opinion, there are about 100 better uses for that extra, squirreled cash.

Do what works for you

All spending is a choice. It’s easy to remember this when a friend refuses to spend time with you, citing the expense of the activity, while they continue to purchase unnecessary electronics equipment, for example. You can identify someone’s priorities by looking at how they choose to spend the money they have and the time they have available. If you look at your own priorities, your budget should match.

Whether you realize it or not, you’re broadcasting your priorities to the world. Spending money and time in one area of your life, at the expense of another area, is really all the evidence you need. If there’s incongruence between the priorities you think you should have and how you spend your time and money, consider changing something. Or maybe, you need to accept the idea that your priorities may not be what you expect. Your real priorities are evidenced by how you spend your limited resources.

So, what if the pick-me-up you receive by drinking a fancy latte in the morning is important to you? As long as you realize that your habit results in a hypothetical “loss” of $10,000 or more over the course of ten years, spend the money. Sure, buying a practical car that requires little care, uses fuel efficiently, and will last a long time can save money over the course of several decades. But if buying a less practical car makes you feel happy and won’t be a financial hardship — even if it means leasing a new car every three years — then go ahead.

Just remember, though: Your spending reflects your priorities.

I see this in my own spending. For example, I still drive my old Honda Civic. In one respect, I haven’t purchased a new car because I see it as an unnecessary expense. I’m more than comfortable with keeping the money I would need to buy a new car in my savings account. Meanwhile, I spend money on things other people would see as frivolous, such as photography classes and equipment, hiring a maid service for my apartment on a bi-weekly basis, coin collecting (though not much recently), and travel.

Is the Latte Factor relevant to your personal finance experience? What does your spending say about your priorities? 

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credit-karma-tax-softwareThe first time I filed my very own taxes was with Turbo Tax, back in 2003. I was 18 years old at the time, attending college, and it was the first year my parents could not claim me as a dependent.

I had earned a fair amount of income from my jobs on campus (and my summer job) and Turbo Tax was of great help.  Living in Florida, I (luckily) didn’t have to worry about state filing costs… the entire experience of entering two W-2s and getting a refund took all of 10 minutes.  It was exactly as advertised, and I was 100% satisfied.

Before I knew it, however, my tax situation became more and more complicated.  I started my own business, began saving a small amount for retirement, got married, had children, bought a house, started a second business … the basic version of Turbo Tax wasn’t cutting it.  Upgraded versions started costing serious money (upwards of $100). Plus, even more money to file my state taxes, now that I live in Connecticut instead of Florida.  It has actually become better for me to have a CPA handle my taxes each year, rather than worry about screwing it up myself while still paying $150 via Turbo Tax or H&R Block.

Well, in a new and very surprising move — at least to this financial blogger– Credit Karma now offers FREE tax software for almost every American taxpayer.  And when I say FREE, I mean it costs absolutely nothing to file both your Federal and State tax returns. No matter your individual (very important) tax situation, there’s no charge when you open an account, no charge when you file, and no charge whether you’re reporting $45,000,000 or $45,000.  (**If you own a small business that files S corp, C corp, partnership, or multi-member LLC paperwork, I’m afraid you’re out of luck this year for filing your business taxes. Credit Karma cannot yet file your return — but this won’t be the case forever, says their CEO.)

Some important points to make before talking about how Credit Karma can provide such a service:

  • The software is not yet live but will be in January — you can even “get in line” now to gain access. You will absolutely be able to file your 2016 taxes next year.
  • You must have a CreditKarma.com account (it’s free) in order to utilize their tax filing platform.
  • Your 2016 Federal and State tax returns are due no later than April 18, 2017.
  • You can print and mail your return after completing it using Credit Karma, if you so desire.  You don’t have to e-file if you don’t want to.
  • Filing your return can only be done by logging into their platform; the software cannot be downloaded.

credit-karma-tax-software-image

When Did Credit Karma Become a Tax Software Company?

Earlier this year, Credit Karma purchased a North Carolina based tax preparation company named AFJC Corporation.  AFJC Corporation is a provider of online tax preparation, filing solutions, and related services for individuals, certified tax preparers, and financial institutions.  As a result of this purchase, Credit Karma is opening a new office in Charlotte, NC, entirely focused on their tax prep services.

Before this purchase, Credit Karma was known for being able to provide you with a free credit score, without even requiring a credit card.  Before them, the deal with other credit score providers was that for the first X number of days, you could see your score without charge. After that, though, your free trial period would end and you’d have to pay a monthly service.

Related: How to Get Your Credit Report for Free

Credit Karma didn’t like that system, which all of the other companies were using. They took the idea a step further and decided to make the whole damn thing free.  And as you can see from their new tax platform, it’s kind of their thing to take an existing pay-for service and make it 100% free.

How Can Credit Karma Make Tax Filing Free of Charge?

Credit Karma is likely spending millions of dollars on their new office, millions of dollars to develop the software to be able to provide 100M tax returns, millions of dollars in advertising (I just saw a TV commercial for their new software), and millions of dollars to staff it all, so that if problems arise, they have plenty of support available.  And, of course, they don’t plan to take in a single penny of revenue from tax filers.

What now? How does Credit Karma plan to make money?  Well, every piece of information you provide them when filing your taxes is going to be used to offer you services in those industries.  For example:

  • When you enter your home mortgage interest, you’ll get an email about suitable refinance options. (If you sign up for any of them, Credit Karma gets a commission.)
  • When you enter your business expense report, and show a lot of travel, you’ll get an email about potential travel reward credit cards .(If you are approved for any of them, Credit Karma gets a commission.)
  • When you enter your self employment health care costs, you’ll get an email about other medical insurance providers that might save you money. (If you apply for any of them, Credit Karma gets a commission.)

You get the idea.  Of course, this is something they’ve already been doing when you get your free credit score through CreditKarma.com. Here, though, they’ll be able to do it on a much grander scale, getting (what should be) 100% accurate information about the consumer and pinpointing offers that might suit their needs.  A lot of up front costs now and, if all goes according to plan, a lot of revenue later.

What Happens to Turbo Tax, H&R Block, TaxACT, my CPA…?

If Credit Karma is successful in offering 100% free-of-charge tax returns for tens of millions of Americans, then it’s a grim picture for the names above (and many others not mentioned).  Platforms like Turbo Tax and H&R Block make their revenues from the costs they charge to file taxes, even if some of their services are free.  Seeing as the news is pretty fresh, I would imagine many other companies are getting ready to cut prices drastically in order to keep business for 2017 and beyond.

What if Credit Karma is not successful in this venture and the revenues cannot sustain the business? Then, you’ll likely see an emboldened group of tax prep providers, strengthening their core products and platforms.

As tax season approaches, I plan to update this article with fresh screenshots and information on the Credit Karma tax prep platform. For right now, they offer no other information than to wait.  So, I wait. But be sure to check back in the coming weeks to learn more, as the Credit Karma Tax unveiling gets underway.

Oh, and don’t worry, H&R Block. My parents will still spend $300 to sit down with you for 4 hours, filing their single W-2 with no investment income. (It’s amazing I turned out so well, really.)

 

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Over the past few years, cell phone providers have declared an out-and-out war to win over consumers. This spells good things for the consumers, who can now take advantage of more low-cost cell phone plans than ever.

These days, even the “big four” cell providers — Sprint, T-Mobile, AT&T, and Verizon — are lowering their prices. And there is a host of other companies jumping on board with cheap voice, text, and data services.

Finding the right plan for your needs requires some research, though. First off, the provider you choose should have decent coverage in your area and areas to which you travel often. Saving $15 a month on your cell phone bill doesn’t mean much if you constantly drop calls in your own living room!

Plus, you’ll need to ensure that the plan you choose has what you really need in a cell phone plan. That might mean unlimited voice and text, or a hefty amount of data for your business.

Whenever you are ready to lower your cell phone bill, check out these 20 low-cost plan options.

Sprint Unlimited Freedom and Family Plans

This plan offers two lines with unlimited data, talk, and text for $100 per month. It offers unlimited 4G LTE data, and allows you to add up to 10 additional lines for $30 each. Or you could opt for a cheaper family plan with limited, shared data and $20 per line access.

T-Mobile ONE

The ONE plan offers unlimited talk, text, and data for $70 for the first line, $50 for the second line, and $20 for up to two additional lines — so $140 per month for four lines. Or you could get four lines for $120 per month when you use Auto Pay. The plan offers unlimited everything in Mexico and Canada, and unlimited text and data just about anywhere else in the world.

AT&T Mobile Share Advantage

This customizable plan allows you to choose how much data you want to share, from 1GB for $30 a month to 100GB for $450 per month. Then, add smartphones for a monthly access fee of $20 per month. If you don’t use much data, this plan would be a great way to cut your expenses down to as little as $70 per month for two lines and limited data access.

Verizon Plan

This giant is known for its great coverage, but has started to lower its prices to stay competitive. The plan comes in five “sizes” from S to XXL. As with AT&T, this plan allows you to customize your data to what you’ll actually use, which can save low-data users some money. There’s a $20/month charge per phone, and data costs anywhere from $35/month for 2GB to $110/month for 24GB+2GB per line.

Metro PC

Launching into the smaller providers, we’ll start with Metro PCS, which offers nationwide 4G coverage. Its “unlimited” data, talk, and text plan really comes with 1GB of 4G data before kicking you down to lower data speeds. Still, the plan is a good deal at just $30 per month, or $25 per month as part of a family plan. For just $50 per month, you can get unlimited talk and text plus 5GB of 4G data.

Cricket

Cricket’s Basic plan runs just $40 per month, and includes unlimited nationwide text and talk plus 2.5GB of high-speed data access. Or the $70/month Unlimited plan offers unlimited high-speed data, unlimited nationwide talk and text, unlimited international texting, and data access and unlimited talk and text to and from Mexico and Canada. Cricket also offers group pricing and discounts for signing up for auto-pay.

Page Plus Cellular

Page Plus Cellular is a no-contract provider that still offers super-cheap plans with restricted minutes and text. The cheapest plan is just $12 per month for 250 minutes, 250 texts, and 10MB of data. Or opt for the largest plan at $69.95 with unlimited calling, unlimited national and international texting, and 7GB of 4G LTE data, which is then restricted down to 2G.

Virgin Mobile

This provider is gaining in popularity, and not without reason. Its main plan is just $40 per month and includes 4GB of high-speed data. Plus, it allows you to stream music from services like Pandora and Slacker without tapping into your data.

Boost Mobile

Boost’s Unlimited Starter package starts at just $30 per month and includes 1GB of 4G LTE data. You can add additional data for $5 per GB per month. Like Virgin, Boost offers unlimited music streaming through certain music apps. For more data, check out the $50/month Unlimited Unhook’d plan, which offers optimized streaming for videos, gaming, and music, and unlimited 4G LTE data for everything else.

Straight Talk

Available plans for Straight Talk depend on your phone and current phone number, so you’ll have to check availability. But some example options include a 1-year unlimited plan for $495 total. This one offers unlimited nationwide talk and text and 5GB of data per month at 4G LTE, restricted to 2G service after that.

Republic Wireless

For just $15 per month, Republic offers unlimited talk and text without data (except on WiFi). It’s a good plan option if you’re near a WiFi signal most of the time. Plans add more data from there, up to 10GB per month on the $90 plan.

GoSmart Mobile

This provider offers four service levels, including a $25/month plan that includes unlimited international texting, unlimited national talk, and unlimited 4G LTE access for Facebook. Its largest plan is $55/month and includes up to 20GB per month of 3G data access, as well as the other perks listed.

FreedomPop

This provider actually offers a free Basic Plan that includes 500 texts, 200 minutes, and 500MB of data each month, as well as free calling over WiFi. You may be able to bring your own existing device to this provider, or purchase a device from them.

H2O Wireless

For $30 per month, you can get unlimited talk and text, 500MB of data, and $10 of international talk credit. Or go up to $60 per month of unlimited talk and text, 4.5GB of high-speed data (restricted to 2G data thereafter), and $20 per month of international talk credit. H2O also offers pay-as-you go plans, which let you customize your payment based on how much talk, text, and data you’ll actually use at a time.

Scratch Wireless

This provider, like many other small providers, operates on the “Wi-Fi First” principal. In other words, if WiFi is available, your phone will operate on that rather than using data. When connected to WiFi, you’ll have unlimited text and data. The service is free for three months, and costs just $7.99 per month after that. If you’re typically in places where WiFi is available, Scratch could be the ideal service for you.

ChatSIM

Communicate mostly by text? ChatSIM is a super-cheap way to make that happen. The base plan costs $15 per year and comes with unlimited texts and emojis anywhere in the world. You can also purchase multimedia credits to cover photos, videos, and calls, ranging from $15 to $60 each.

Red Pocket

Red Pocket offers two types of service: its Flagship Plans, which work on all its wireless networks and allow you to keep your phone and phone number, and Device-Specific Plans. Flagship Plans begin at just $29.99/month for unlimited talk and text and 500MB of data. These plans go up to $59.99 per month for unlimited everything with 3GB of high-speed data (and lower speed data after that).

Simple Mobile

You can bring your own phone or buy a phone through Simple Mobile, and then sign up for a $60/month plan with unlimited 4G LTE data. Don’t need the data? Keep it simple with a $25/month unlimited talk and text plan.

US Mobile

This provider offers completely customizable plans, so you only need to pay for the services you actually use. For instance, you can pay $3/month for 100 talk minutes, or $15/month for up to 5,000 minutes. Similarly, texting costs $2/month for 100 texts or $7/month for unlimited texts. And data costs from $2/month for 100MB to $35/month for 6GB. Add on a $2/month service charge, and you’ve got a plan you can completely customize to your actual usage.

ROK Mobile

As with other providers, this one cuts back on the cost of streaming music by providing the ROK Music App. It offers a $49.99/month plan with unlimited talk, unlimited text, and 5GB of 4G LTE data.

So which one wins?

As you can see, there’s some huge variability in plan prices here, from free plans that focus on WiFi coverage to $100/month plans from the “big four.” The key is to ensure that any provider you choose will have good coverage in your area, and that the plan will be sufficient to meet your talk, text, and data needs.

Be sure to read the fine print. Also talk to friends and neighbors about their coverage, especially with less well-known providers. Then, pick a plan and start reaping the financial reward of this wireless war for customers.

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Life Is Short: Toxic Financial Attitudes

by Luke Landes

There’s a good reason I can’t get into extreme savings for retirement. When desperate financial times call for desperate financial measures, there is a good incentive to cut all unnecessary spending and eliminate bad debt. Many people even wait until they hit rock bottom before reforming their approach to their finances, because the effects of […]

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8 Tips for a Frugal Valentine’s Day

by Luke Landes

For several years, it was a February tradition on Consumerism Commentary to look for moderation on Valentine’s Day. Many young couples would like to use the day to express their love, but might not have the financial means to do what television commercials make you believe is normal. If you have additional ideas, feel free […]

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When Money Is Scarce: Forced Frugality and Bad Decisions

by Luke Landes

I’ll be honest. When the idea for this article struck me late last night, I had a definitive idea of how I was going to address the topic of conservation mode. But the clarity of day may have changed what I think about the idea. Throughout my life, I’ve been working with scarce resources. Now, […]

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Four Expenses I Couldn’t Dream of Having Ten Years Ago

by Luke Landes

Having my own business, and an eventually successful one at that, has changed my life — but it hasn’t changed it much. I was forced into frugality by necessity in 2001, a few years after I graduated from college and was growing deeper into debt. I needed to fix my finances for the sake of […]

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5 Most Annoying Banking Fees

by Luke Landes
Grabbing money

Fees and surcharges seem to be an unavoidable part of living in a world where banking is big business. If you keep your financial situation simple, diligently shop around, and keep an eye on your money, you can avoid may of the more common fees. In theory, you could increase your fee-avoidance ability by keeping […]

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Learning to Say No

by Luke Landes

Earlier this week, I appeared on HuffPost Live, an online television channel, to talk about saying no to spending. Social situations make it difficult for people to admit among friends that they can’t afford whatever the social activity might be, such as dining out or going to a club. The discussion was couched in fashion. […]

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