A lot of people think frugality is all about saving money, and saving money on things you already buy or want to buy is a smart idea. But, are you spending too much of your time trying to save a couple of dollars? Your time is just as precious.

Being frugal is making the best use of both your time and money.

Are you sweating the small stuff?

Unless your budget is extremely tight, it’s often not worth it to sweat the small savings if you have to give up your time to do it.

People can spend hours clipping coupons for not much return. You have more important things to do than spending every evening scouring the web for deals and price comparisons. You may not be making the best use of your time if you:

• Drive from store to store to save a couple of dollars?

• Go to a service station 20 kilometres out of your way because the price of gas is 2 cents less?

• Spend hours in line on Black Friday or Boxing Day for discounted merchandise you don’t really need?

We all want to save money, but that time could be spent with your family, on your hobbies, or even starting up a side business, creating a better life in general.

Are you wasting time to save money?

Focus on the big picture

A small percentage of your purchases represent a large portion of your yearly spending – rent or mortgage payments, car loans, large electronics and appliances, and vacations. These are the things that are worth taking your time to compare and analyze before you buy.

• Housing – whether you rent or buy, where you choose to live will make a huge difference in how much you’ll pay. A $400,000 mortgage at 3.85% will cost you $2,072 per month and $71,596 in interest over a 5-year term. You will pay almost $200 a month less and save yourself almost $10,000 in interest if you reduced your mortgage to $350,000.

• Transportation – this is often your second biggest expense when you factor in loan payments, insurance, maintenance and gas. High end and oversize vehicles will increase your costs in all these areas.

• Vacations are a great area to save money. Taking a few hours to compare flights, check hotel deals and even checking out savings sites like Groupon could save you hundreds of dollars on your trip, especially if you book during the shoulder season. But, be reasonable. Is saving $50 worth enduring two layovers that tack an extra four hours onto your flight instead of flying direct? Not to me.

• Make a quick call to your insurance and service providers (phone, cell, Internet, TV) each year to make sure you are getting the best rates.

• Look for new, better paying, job opportunities. Ask for a raise. Negotiating a single $5,000 raise early in your career could be worth more than $1 million over your working life.

Final thoughts

You may have heard the saying, “penny wise, pound foolish.” This means going out of your way to save $1 on laundry detergent (wasting your time scrimping on the pennies) while mindlessly paying top dollar on your costlier expenses. When you’re trying to manage your budget, you want to focus on the categories with the biggest payoff. What money saving tactics will net you the largest overall savings?

Your time is also valuable, so treat it that way. Take the time to save on large ticket items, and don’t feel guilty about paying a little more for the small stuff, especially if it gives you more time to enjoy your life.

“Waste your money and you’re only out of money, but waste your time and you’ve lost part of your life.” Michael Leboeuf


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