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Are You Eating Away Your Future?

May 5th, 2011 at 08:03 am



The original post can be found here: Debt Free

Several years ago when we finally decided to take control of our money, we took a close look at our spending. We were absolutely blown away when we realized how much we were spending on dining out. On average, we were spending well over $300/monthÖfor just the 2 of us.

You may spend more or less. But letís work with this figure for now. Letís say that from age 25-65 we spent $300 per month on dining out. This is really a conservative figure because we are assuming that those costs would never rise and that we would never be spending money on kidsí meals out.

Spending $300 per month for 40 years equals $144,000 spent on dining out! That number blew me away, and I hope it blows you away too.

Now letís imagine that we invested that same amount. $300 per month invested for 40 years with an average annual return of 12% would equal $3,092,912.61. Are you kidding me?? Letís say Iím overestimating the rate of return on the investments. What if we only averaged 8% annual return, which is much lower than the stock marketís 50 year average. That would still be $1,007,211.74!

But letís be honest here, I love dining out. Who doesnít? So Iím not suggesting that you never dine out. I am, however, challenging you to consider how you are spending your money.

We have cut our restaurant budget down to $140/month. Thatís $160 per month less than we used to spend. Letís say that we invest just the extra $160 per month for the next 40 years. At an average 12% annual return, that will give us an extra $1,649,553.39.

Well over a 1.5 million dollars earned for retirement simply by investing our saved restaurant money!

And what did we sacrifice for it? Not muchÖwe still go out for dinner at least once per week.

Small choices and sacrifices can add up to huge results. Instead of spending mindlessly, you must be conscious of your choices if you want to win with money. Take the time to sit down and evaluate the amount your family is spending on restaurants. You could literally be eating away your future.

Yours In Freedom,

Clint



Join The ConversationÖby how much will you commit to reducing your restaurant budget?

6 Responses to “Are You Eating Away Your Future?”

  1. MonkeyMama Says:

    The interesting thing is we used to eat out all the time. IT was never a budget buster. Probably because a lot of our meals were financed by our employers. & we had so little in any other expenses - we were literally saving 50% of our income.

    BUT, food was the first bill we cut when we had kids. Probably the only substantial thing we really had to cut. I was pregnant when we first switched to home cooked meals, but my already underweight spouse immediately lost 10 pounds. To this day, I notice any eating out creep up on the scale before I notice all the bills at the end of the month. The scale knows! & I find that so weird because I am the type to stretch one restaurant meal into days of leftovers. So I have often wondered what in the heck they put in restaurant food. Because the same stuff at home is usually lighter fare, apparently. I share because the cost savings is probably bigger than people realize - if eating out less is better for your health.

  2. clintdavis Says:

    That's a great point MM. You will usually be eating fresher, healthier foods when you cook at home. Undoubtedly, that will end up saving you in health care costs down the line. Thanks for the reply!

  3. LuckyRobin Says:

    We eat most of our meals at home, but once in a while we'll have a really lazy month (or a sick month) and boy, eating out or getting takeaway sure can blow the food budget. We are very careful where we eat though, as so many restaurants still use MSG and high fructose corn syrup (particularly in soda), which will cause that weight gain MM is talking about. We've found a few good, local non-chain restaurants that cook from scratch or mostly from scratch and we use those when we do go out. We also only drink water to keep costs down (soda for 4 can be upwards of $10) and don't get dessert. My son and I split an entree, usually, as well, since neither of us can eat a whole order.

  4. Jerry Says:

    Dining out leads to a huge expense, and I have a friend who eats out for almost every meal. He is single and lives alone, and says that it is just too depressing to eat at home by himself. I guess I see his point, but wow, the financial long term consequences are pretty staggering, here! That money invested, saved, or put into an annuity would change his life pretty significantly in the long run...
    Jerry

  5. clintdavis Says:

    Lucky, thanks for the comment. It sounds like you folks are making wise choices, even when you do go out to eat. And don't get me wrong...we love dining out as much as anyone. But we agree on our "Restaurant" budget category before each month begins. Once we have used up our budgeted money, we don't go out to eat anymore for the month. It really helps us keep our spending in check. We have some substantial financial goals that are far too important to just "blow" on dining out too much.

  6. clintdavis Says:

    Jerry, you're absolutely right. It's staggering how much we are really sacrificing in the future when we overspend now. That's why I do what I do!

    Thanks for the comment.

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