Eating Out? Where Does the Money Go?

My wife and I do not have a "blow" section of our budget. We just don't blow money right now (or we do our best not to!). However, we do have a couple of areas of our budget where we splurge every now and again. One is that we still have DirecTV, but we do not have a large package (and we renegotiated our bill down to less than $40/month, with two receivers).

The other is that we still go out to eat sometimes. We don't go a lot, but we do like to "grab a burger" every couple of weeks. We also like to "dine" about once a month. We don't go to five-star restaurants, but we also don't go to Waffle House for our fine dining!

However, just because we set aside money for eating out does not mean we can just pile up a huge bill when we do so. Many people leave a restaurant and have no idea where all the money went. Here are some "little" things that really add up when you eat out:

1. Appetizers and desserts. At most national chains (think Applebee's, Olive Garden, etc.), these can be anywhere from $5-$10 each. Just adding one appetizer and/or dessert can make a bill get large quickly. Why do you think the wait staff asks you if you want them?

Two people: one gets an appetizer, the other dessert: add about $15 to your bill.

2. Not drinking water. I have to admit, I "add this" on my bill nearly every time I eat out. I drink a lot of water during the day, so, when I eat out, I want something else. This being a Christian blog, we're not even going to discuss the cost of alcohol. But just think of a soda, tea or lemonade. $1.50-$3.00 per person! And many restaurants are starting to offer "premium" drinks, like specialty sodas that are even more.

Two people: two "non-water" drinks: add about $4 to your bill.

3. Over-ordering. Some restaurants have smaller and larger versions of certain dishes. Many have half-portions if you will just ask, especially on large dishes. Often we are guilty of letting our eyes tell us we will eat a 12 ounce steak, when we only end up eating 6 or 8 ounces. If you constantly have food left over, ask about smaller portions, OR...

4. Not getting to-go boxes. When you have food left over and you can take it home, but fail to do so, you are leaving money on the table. If an entree costs $10 and you each 3/4 of it, but don't take the rest home, you, in essence, just left $2.50 on the table...and not as a tip. Sometimes you are travelling and cannot take food home, but you often can. Do so if possible.

Two people: don't eat (or take home) 1/4 of two $10 entrees: you just lost $5.

5. Tipping Too Much. I think tipping is a great thing. Many waiters are great and earn their money through kind service and quick response. Others, though, don't. They are just there and don't do well at all. There are some who think you should tip a certain percentage "no matter what, because it's just the right thing to do." I can't disagree more! While I always leave a tip, a waiter has to earn a larger tip.

Two people: overtip by $3.

Add all those things up. On a typical night at a typical restaurant, by just doing these five things, you have over-spent (or lost) $27. Now, do that once a month (which is way less than most people eat out), and you have just thrown away over $300 just in "extras" while eating out.

You can eat out and be frugal, but you have to think and plan ahead.

WYTI Links: 08.22.07

Wednesday's Links...a practical edition: (I had these ready to go on Tuesday night, but silly dial-up kept timing out when I tried to post them this morning. Sorry...blame Bellsouth...or the new AT&T.)

• Are Personal Finance Magazines Worth the Cost? (via Get Rich Slowly)

• The Simple Dollar Guide to Shaving (via The Simple Dollar) Every man's gotta do it...here's Trent's plan for doing it cheap(er).
  

• Tackling Breakfast: Healthy, Inexpensive, And Easy Meals to Get Me Started In the Morning (via The Simple Dollar)
  

• 100 Things You Can Make Yourself (via $imply Thrifty) ...with links and instructions!
  

• 10 Ways to Cut Your Restaurant Bill Big Time (via Money $mart Life) Eating out is our biggest weakness, so these suggestions are helpful.
  

• Five Things Parents Can Do to Avoid Lead Poisoning (via Consumer Reports) Despite the ambiguity of the title, it's about avoiding lead poisoning in children not in parents ;).
  

May I Take Your Drink Order?

When the question is posed, we usually respond as if by reflex. The host/hostess has already given us our menus, and the question we're actually pondering is "Ribs, Steak, or Sandwich?" We haven't given a great deal of thought to what we'll drink, but after all, that's an easy answer. As the waiter/waitress goes around the table and pauses on me, I say, "Dr. Pepper," and my wife quickly responds, "Sweet Tea." Four words without thought . . . and how much have those four quick words cost us?

At fast food restaurants today, soft drinks cost between 99 cents and $1.49 depending on size and location. At sit down restaurants, a soft drink with unlimited refills generally costs at least $1.49, many times today the soft drink costs $2 and up. Usually we don't even think of the cost, because, after all, it's just a buck-fifty. However, that's not the total cost of the drink. Tax comes on top of the drink, just like every other purchase. Here in Arkansas, tax is about 10% as it is in most places. Additionally, at a sit down restaurant, we tip - for the price of the meal after taxes. A moderate tip is 15%. So that $1.50 drink in real cost is $1.50 + .15 tax + .25 tip = $1.90. The $2 drink costs $2 + .20 tax + .33 tip = $2.53. Going with the average, a soft drink at a restaurant costs $2.22. Those sodas suddenly cost a little bit more.

The cost of the drinks doesn't stop there. When Stacey and I eat out, there's two meals, so two drinks. Our cost of drinks is suddenly an average of $4.44 per meal. Eating out twice a week is a pretty conservative average these days. Consider the savings for your situation:

• Single: $2.22/meal; $4.44/week; $17.76/month; $230.88/year
• Couple: $4.44/meal; $8.88/week; $35.52/month; $461.76/year
• Family of 3: $6.66/meal; $13.32/week; $53.28/month; $692.64/year
  
• Family of 4: $8.88/meal; $17.76/week; $71.04/month; $923.52/year
  
• Family of 5: $11.10/meal; $22.20/week; $88.80/month; $1,154.40/year
• Family of 6: $13.32/meal; $26.64/week; $106.56/month; $1,385.28/year
  

Growing up in a family of six, we learned to automatically answer the question of what to drink. We immediately knew what we wanted to drink. We always responded, “Water” before even hearing the selection of soft-drinks, teas, and lemonades. In a family that large, drinking water saved an average of $13.32 per meal at restaurants. That was just money that didn’t have to be spent.

So today’s suggestion of frugality is one most of you already have recognized as a possibility - drink water instead of soft drinks, tea, or lemonade at restaurants. The savings is really quite significant. The significance is visible with every meal for a family, and even as a single individual the difference becomes significant over the course of a week, month, or especially in a year. And since a single person generally eats out more (it's easier than cooking for one), their savings may be closer to the family of 3 or 4! Stacey and I have made this change within the past couple of weeks. In fact, since we're going back to one salary (Stacey's beginning graduate school full time), this was the first change we made to help trim off unnecessary expenses. Last week we were on vacation, and ate out 10 times, but drunk only water, saving $44.40 in that one week! It's been a pretty easy change, and water sure is tasting good these days!