Watch the pennies and the dollars will take care of themselves.
~ Benjamin Franklin

It should be no secret that here at Saving the Crumbs we are all about economy in our spending and lifestyle.  But the common excuse is often made that saving in the little things isn’t worth the trouble.

Would skipping a Starbucks coffee here or there really make a difference in the grand scheme of things?

Eating out is just a part of life, and what is that compared to my big salary?

Would saving a few dollars on our groceries really help me with my $20,000 student loan debt?

What difference does it really make to save $30 bucks on my electric bill?

Don’t I make enough money that I don’t have to worry about those little things anymore?

That kind of thinking is EXACTLY the reason why so many people are struggling with their finances and wondering where all their money went!  The problem is a wrong perspective of money.

What Amount Then?

So let’s flip that question around.  At what dollar amount then, does spending actually start to matter to our financial health?  You tell me.  Is it $1 million? (That’s what those lottery players think.)  Or is it $1000?  Or $100?  Or do we just go by emotion—whatever feels right at the moment?  But surely, $10 is such a pittance that it couldn’t possibly be a big deal, right?  Well, let’s think about that, shall we?

What is $10 Worth?

So what does $10 buy in my home?

  • $10 pays for most of our groceries in an average week.*
  • $10 pays for gas for Deb’s daily round-trip commute to work for at least a week in our not-so fuel-efficient car.
  • $10 pays for the power for hot showers for at least an entire month.
  • $10 pays for our entire monthly water bill for our house INCLUDING the guesthouse that we rent out.

So is that $10 movie ticket really worth a whole month’s worth of running water or a month worth of hot showers?  So maybe the good ol’ Hamilton isn’t such a pittance after all!

Another Perspective

“Yeah, yeah,” you say.  “Those are YOUR numbers, not mine.  This doesn’t apply to me.”

So let’s make things a bit more interesting. Let’s just say that we save $10 a week.  No big deal, right?  That’s like brown bagging ONE lunch a week instead of eating out.

Hundred Dollar Bill

Save Uncle Ben!

In one month, that’s $40 saved.

In one year, that’s $520 saved.

In ten years, that’s $5200 saved.  That’s how much my car, a top-trim 2002 Honda Accord is currently worth according to Kelley Blue Book!

So how much is that $10 movie ticket or that $10 lunch worth now?

Upping the Ante

But come on, saving $10 a week is easy.  Anybody can do that.  We can do better, we’re hardcore Crumb Savers, right?**  So let’s assume that you’re going to save $10 per day and you’ll invest the savings at an assumed return of 7%.  That equals $3650 saved per year.  With those numbers…

…in 10 years, you will have $50,000.

…in 20 years, you will have $150,000.

…in 30 years, you will have $350,000.

Still think $10 bucks is chump change?

This gets even more astounding when you realize that this exercise has only accounted for one person in the home saving $10 per day.  If you’re married and both you and your spouse save $10 each per day, then the numbers compound even more.

One Bill At a Time

How do you suppose the rich people built up all their wealth?  A dollar at a time.  Famous billionaire Mark Cuban started off selling garbage bags from door to door.  Warren Buffett worked delivering newspapers.  They saved up bill by bill then invested wisely.  They got to where they are today because they didn’t disrespect the small bills.

And neither should you.

Perhaps if we heeded Uncle Ben Franklin’s advice a little more closely, we’d be stuffing a few more bills with HIS face into our pockets!

*Update: I had previously stated that $10 paid for all our groceries for a week.  Thanks to an astute comment below, I double-checked our numbers and our average grocery bill is actually closer to $14/week.

**Actually to be really hardcore, we should be shooting to save 50% or more of our income.