One of the benefits of being debt free is obviously having more cash on hand each month to do other things with as opposed to paying creditors. We prefer having the extra cash now to build wealth, save for college for our three children and even save us more money when shopping. Let me explain. Once we became organized with our money we began to shop with a list, clip coupons, and compare prices. We still do this today. Just recently we opted for a 12 pack of ice tea our daughter asked for at a price point of $9.99 over the six-pack at a price of $5.79. That was a $1.58 savings, having the wiggle room in our budget allowed us to purchase the 12 pack and save the additional money.
We now take this a step further when shopping for food and personal items we regularly use. I wear contact lenses, and regularly need content lenses solution to clean and store my lenses. I always purchase a two pack of the solution when I running low and need more with a typical cost around $21 when on sale I can find it for $16, a $5 saving. Since I can’t predict when I will run low and need to purchase more. I can’t guarantee myself that the solution will be on sale at that exact time I need it. So now I simply purchase 2 or 3 at the time of the sale saving an extra $5 or $10. Again I only have that ability now that we are debt free and have the surpluses of cash in our budget to take advantage of the sale. Repeating this behavior over time can save you a bunch of money. In the two recent examples, we saved $11.58 on things we were going to purchase anyway, just now at different quantities.
One of the other ways we are now saving money while shopping is with a rewards credit card. Technically we are not saving any money by using the card, but we are earning money in the form of cash back rewards. Our rule is simple for the use of the card, we must have the cash on hand to pay for the item in full if we plan on using the card for any purchase. We did this over the Holidays and our first rewards check was $48. Not bad for money we had already planned on spending and had budgeted. We recently took this a step further. We were in the market for a new oven. We found one we like and it had a price tag of $900. I wasn’t willing to pay that much for the oven and remember reading a post over at EOD about asking for a discount.
That prompted me to do a little more homework. I found that my company was part of a Buyer’s Edge program and according to their member list there are 90 or so other companies in the tri-state area that use them too. What’s Buyers Edge you ask, it’s a consumer buying service that guarantees the lowest prices on most major purchases. So I took the model number of the oven we were interested in and got a price. The oven through Buyer’s Edge was $635 or 29% cheaper than retail. Boom! Now pay for it on our cash rewards credit card and we are looking at a $12 reward. Double boom!
Now if we were still in debt we wouldn’t be in the market for a new oven or swiping a credit card, but after working hard to clean up the mess we have the wiggle room within our budget to take advantage of these deals and offers presented to us.
I think this is only the beginning for us, travel hackers have been doing these kinds of things for years, making the system work to their advantage to travel for free or next to no cost. A view it as sort of challenge now, how cheap can I purchase something for or how to change I maximize my rewards. This flexibility is all given to us by cleaning up the mess first and reaching the point of being debt free but staying focused to still remain organized and spend within our means.
I realize not everyone may have an opportunity like Buyer’s Edge program available to them, but that shouldn’t stop you from seeking the best deal or lowest prices when shopping for any item. There are so many ways to compare prices via the internet, smartphone apps, etc. These tools can very easily help you gain a consumer edge if you invest the time.
If you are debt free do you find it gives you more flexibility in saving money? If so how?
What would you do with a little wiggle room in your current budget?
Brian is a dad, husband, and an IT professional by trade. A Personal Finance Blogger since 2013 who, with his family, has successfully paid off over $100K worth of consumer debt. I want my three children to handle money better than I ever did at a young age. I have been teaching them as much as I can for the last 10 years. My goal is to continue to champion the financial literacy message and then why I created the “How To Rock Your Money” book. To help teenagers navigate their financial futures. I hope my family’s story of paying off over $100,000 worth of debt will inspire and motivate you to take control of your money. He blogs at BrianBrandow.com