Dollars and Sense: The best day-to-day investment you can make? Don’t laugh - East Valley Tribune: East Valley Voices

Dollars and Sense: The best day-to-day investment you can make? Don’t laugh

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Linda Hutchings is a Gilbert resident and a life-long frugal consumer—uh, cheap skate. Please reach her at: uberfrugal@outlook.com. Send her your penny-pinching ideas.

Posted: Thursday, March 21, 2013 7:21 am | Updated: 3:49 pm, Tue Mar 26, 2013.

Johnny Carson asked the financial guru, Andrew Tobias, “If you only have $1,000 to invest, what would be your best investment?” The answer made the audience laugh. They laughed!

What would Tobias buy? Nonperishable consumer staples.

What the heck are nonperishable consumer staples? Well, staples are basic foods and household products that you need and will buy — over and over. Nonperishable items do not spoil easily and are kept on a shelf. They can be canned goods, detergent, toothpaste — the list goes on. In contrast, perishable items will spoil, so they are kept in the fridge or freezer. These are your meats, eggs, and milk, among another long list of items.

Why invest in nonperishable staples? First, they have a long shelf life and could save your life from disasters big — think Hurricane Sandy — or small.

Second, storing them will save you time and money in everyday living. Going to the grocery store for one item can waste half an hour, minimum. Fewer trips mean you will save money on gasoline as well as on the impulse buying you will avoid.

We all make emergency runs to the store. Maybe you needed baking soda so your half-mixed cookies would turn out better than hard little hockey pucks. Here’s the kicker. Did you go to the store, buy other stuff, and come home to discover that you forgot the baking soda? I have done exactly that. The storing of staples will be your friend. When you run out of detergent, it is sweet, indeed, to take another bargain bottle off the shelf and get on with the laundry.

The key factor in saving money on stockpiling these staples is to buy them when they are on sale. Let me repeat. Buy staples on sale.

If you buy a $1 can of beans on sale today for 80 cents, this is an immediate savings of 20 percent. In the future, you may not find that can of food on sale at the moment you need it. Would this kind of return on investment in the stock market make you happy? What would you save if you not only bought the beans on a two-for-one sale, at 50 cents apiece, but also avoided an even higher cost should prices inflate — kinda like Aunt Marge in “Harry Potter.”

Inflation is when things cost more over time because dollars are worth less. What will happen to you if inflation starts upward as some predict?

Years ago, I saw runaway inflation when I lived in Argentina. It was heartbreaking. The peso inflation was so fast that merchants used calculators based on the day’s dollar-peso exchange rate to figure the day’s prices. Things absolutely cost more the next day. Before I went to Argentina, I believed that saving every penny was the 11th Commandment.

My head exploded when I realized that saving all of your money under certain inflationary circumstances might be a bad thing to do. Buying things that held their value became important. I looked at my stable U.S. dollar bills with deep respect. When I returned to Arizona, I could hardly give up one precious U.S. coin to make a telephone call. No wonder the Argentines were always trying to buy our firm U.S. dollars. (Please, Mr. Bernanke, please, protect our precious dollars.)

Watch out for manufacturers’ tricks. To hide higher costs, they often keep their prices about the same while sneakily reducing the size of the item you buy. Do you remember when a half gallon of ice cream shrunk to only 1.5 quarts? Do you remember buying bigger jars of jam? Always check the shelf sticker to see the cost per ounce or per unit.

Buying staples on sale now for future use is not hoarding. You are not buying scarce supplies, not depriving others, and not stumbling over trash in your halls. I reject slanted TV shows that ridicule reasonable storage. They either exaggerate by calling it pathological hoarding or the doomsday fear of the chronically paranoid. Even ants store up for future needs.

Are we less intelligent?

So, know prices well enough to spot a bargain. Carry a little shopper’s notebook in which you write prices. When you find a staple on sale, buy multiples of it. And know the shelf life of products so that you use them at their peak perfection by marking the dates in big letters on the packaging.

Go easy on how much extra you buy. Nothing radical here. As you are able, habitually buy extra staples when they are on sale. Yes, you are spending more money right now; but over the long haul, stocking up on nonperishable consumer staples is one of the best investments you can make. Saving money is guaranteed.

In Aesop’s fable of the grasshopper and the ant, only the stockpiling ant survived the winter. You, too, can survive whatever “winter” comes — and you will get the last laugh.

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