When You Buy Toilet Paper Says A Lot About Your Financial Smarts

various_rollsI didn’t need to buy toilet paper this week.  I have a 3 week supply and I could postpone the purchase for a least another 2 weeks  but it was on sale this week at Costco and it might not be on sale when I need it.

Do you buy toilet paper when it is on sale or do you buy it when you need it?  This 1 question could be the key to what you are doing wrong with your money.

It is more complicated than just watching for what is on sale and stocking up.  Anticipating your need and buying before you run out and have to over pay is key to saving while spending.  If you wait until you are down to the last 12 tea bags to start to shop for a bargain on Tetley then you will either be tealess waiting for a sale or you will have to overpay.  I bought my favourite tea this week too.  I still have enough tea to last me until January 2014 but it only seems to go on sale at Costco every 3 months or so.   I bought a box and I am set until the next sale.

True savings can come from not wasting money on shopping when there is need.   Shopping should be done in anticipation of need.  If you are buying when you need it then you are probably wasting money.  If you can’t figure out the best times to buy toilet paper then my guess is you are making other shopping errors too.   Big errors can occur when you are feeling rushed or pressured or under a time constraint.

Every year in February and March all of the Canadian financial institutions heavily advertise  that the RRSP (registered retirement savings plan) contribution deadline is looming and there is pressure to hurry up and invest.   The people who fill the little bank cubicles in February and March to throw their money down on whatever mutual fund the bank guy is pushing are the same people who buy toilet paper when they need it instead of when it is on sale.

People wait until the last minute to make their investment decisions.   Many have been saving all year but wait until the deadline to move the money in to an income generating RRSP.  Why wait?  If you are facing the RRSP deadline you can open an RRSP savings account.  It won’t pay very much interest but it qualifies as an RRSP so you can take advantage of the tax credits without rushing in to an investment decision.

With Christmas coming I am watching for sales on butter and bacon.  With the estimated end to my HELOC debt being April or May I am shopping for good investment opportunities and reading and researching companies and watching interest rates.

What do you need to buy in the next 2 to 4 weeks or even the next 6 months?  If the answer is bananas then you might as well wait.  If the answer is toilet paper or a new ETF then you had better start hunting for a good deal now.

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25 Responses to When You Buy Toilet Paper Says A Lot About Your Financial Smarts

  1. Ree Klein says:

    Ah, TP…you can never have enough! All kidding aside, you make a really excellent point. In fact your argument extends to vehicle and home maintenance, too. Most people wait for something to be broken before giving it any attention. Moreover, they don’t regularly save for these inevitable expenses.

    Great way of driving home the message!
    Ree

    • janesavers says:

      I have one friend who does run out of toilet paper from time to time. I have used Kleenex and fast food napkins in the washroom while visiting their home. Who runs out of toilet paper? I can’t imagine what their finances are like.

  2. Alicia says:

    I’ve run out of sandwich bags, and dish soap (my fiance uses a quarter a bottle per sink of dishes it seems!), but never toilet paper! And if I was ever close to being out of it, I can’t imagine having guests and giving them fast food napkins – rough much!

    • Alicia says:

      Also, that is something I never understood as a child – when banks advertisements say “it’s RRSP season”… shouldn’t it be a year round thing?

    • janesavers says:

      Anything other than TP could really mess up the plumbing. I am never even close to running out and there is always the emergency roll in the car.

      Try adding water to the dish soap. I cut it half and half water to dish soap and I use that in the hand soap dispenser in the washroom too.

  3. We do this. We keep an inventory of what has to be replaced, and when we see a sale (like on navy beans this week) we clear out the stock because it’s a good deal.

    That said, we don’t stockpile like hoarders (no pantry here), but for certain things like pistachios, we know they’re expensive and if they are on sale it is rare that they are so we stock up.

    We do the same for soap, toilet paper… etc.

    As for RRSPs, I tend to NOT buy in December or January (Santa Claus rallies boost the cost) and wait until February or March to make decisions when stocks tend to generally be at their lowest which means index funds will be slightly cheaper.

    At any rate, I tend to just put in a lump sum the minute I find out what my contribution room is (I max everything out), and wait with it in cash or in money market funds until I see something worth buying.

    • janesavers says:

      You were lucky to get the bags of beans on sale. I find they never go on sale. I guess it is because not enough people buy them to make them a featured sale item.

      I am a walnut eater and they never go on sale unless they are at the expiry date. Walnuts are a source of good fat so I keep them in the fridge to prevent them from going rancid. I will treat myself to a few nuts in the shell this holiday season. Hard to beat Brazil nuts in the shell for amazing flavour.

      As for maxing out your RRSP and I assume your TFSA I have never maxed out anything except a credit card. You may make your deposit when you figure out how much you can deposit but you don’t rush in to an investment. Those of us who are not self employed generally know from year to year approximately how much RRSP contribution space is available.

      I have about $50,000 in contribution space available because I have never had any money to contribute. I will add my contribution room from this year to it and I will probably never max out.

  4. Bet Crooks says:

    I agree 100% with this entire article. Unless one is so severely cash-strapped that pre-buying is impossible, it’s the only sensible way to run a household.

    Yet I meet people all the time who seem to have no idea that staples and household necessities all cycle through a predictable sale pattern. Maybe it has to be taught parent to child? I know I learned it before I left home.

    • janesavers says:

      I did not really learn anything about money as a child but this is just such common sense. I follow the sale patterns and I stock up. While I am no way near a hoarder having an extra package of staples on hands can save money and free up extra cash to spend on whatever is marked down the next month.

      I would assume that people who don’t shop in advance also wait until their car is on E before they fill up. That won’t help you if there is a power outage or if you are stuck in traffic.

      • Bet Crooks says:

        Hey, that’s something else my Dad always taught us: never run a car below half a tank. (Obviously that doesn’t apply to an emergency.) It’s great advice if you can because then you can also top up when the gas cycle is lower. (At least in Ontario where the prices are not regulated so they yo-yo all week long.)

        I wonder if running on E is something only big city folks do? In the country it could literally cost you your life. (We were taught to always keep a huge candle, an empty coffee can, matches and a lighter, a couple of those silver warmth blankets, etc. in the trunk in winter. I cringe when I read warm-country tourists asking if they can rent a car in Calgary and drive to Jasper via Banff in time for New Years. I’m sure those rentals have no survival gear at all….)

        • janesavers says:

          I get to 1/4 tank but I do most of my driving in town. I fill up if I am headed on the highway. I have big mitts and a toque in there now and I will throw boots and a bigger coat in if I am travelling.

          The same people who travel without emergency gear are also the same people who think you can get cell phone service everywhere.

  5. jeweltea says:

    I always buy ahead if I see a good deal. TP is one of the things that I have a lot of. There was a store (no longer around) that doubled coupons to $1.99 (so a $1.50 coupon would be worth $3.00 for example) which made TP (and paper towels) free (actually they gave you the overage since the TP and paper towels did not cost that much at the time). I miss that store…..

    • janesavers says:

      I have never experienced double coupon days. It seems to be an American thing.

      I never get anywhere close to running out of TP. I start to panic if I get below a dozen rolls.

  6. Judy says:

    Ha ha! TP is on my shopping list for this weekend. There is always some brand on sale, so I don’t worry too much about stocking up. I would be mortified if I had to give my guests paper napkins. I didn’t renew my Costco membership as I didn’t use it enough, and I can get just as good prices at Superstore with no membership fee.

    The people that I am amazed at are those that take out loans for RRSP contributions. If you can afford loan payments, then you can afford to make RRSP contributions throughout the year, and save yourself the interest. I think the TFSA is much better anyway. With an RRSP you get the tax savings now, but you will have to pay the tax on the principal, plus any gains eventually when you withdraw. With the TFSA all gains are also tax free.

    • Bet Crooks says:

      True, Judy, but hopefully in time you’ll want to use your RRSP because your TFSA will be maxed!

    • janesavers says:

      I am shocked by those RRSP loan people too. What are they thinking?

      I am going to take advantage of the RRSP tax refunds now and deal with the tax upon withdraw in the future. I will be a low income retiree and so I am hoping that I won’t be in too high a tax bracket.

      I like the gas price at Costco and the 2% cash back on the gas that I get using my Costco Amex. Some things, like the yogurt I like and the oats and sunflower seeds I eat for breakfast every day, are just so much less expensive that it justifies my membership.

      Fast food napkins instead of TP is not a pleasant experience.

  7. Mr. 1500 says:

    I cannot stand waiting in lines. Whether it be at an amusement park or the grocery store, life is just too busy to stand there looking at the rear end of the person in front of you. I jumped for joy when the grocery store got those self-checkout lanes. In my experience, the majority of fellow humans are flummoxed by these things which is great. No wait for me!

    Anyway, I jumped for joy when gas stations installed “pay at the pump” a while back. No more going into the gas station and waiting in a line. Woooo!

    However, just last week I was at a 7/11 station and the siren call of the Slurpee was more than I could resist. When I went in to buy one, I observed something that I thought was quite incredible and equally ridiculous. The person in front of me had done a good bit of grocery shopping. She had milk, cereal and all sorts of junk food. When she rang up, I noticed that most of the stuff was almost 2x the cost of the regular grocery store.

    Trust me, this person didn’t look like they were living the high life either. If I had to guess, I’d say they were living in poverty. Sadly, habits like shopping at the gas station will keep this person in poverty.

    • janesavers says:

      People do buy all that stuff at the 7/11. It is so overpriced. I know that sometimes we do urgently need something on a holiday when all the other shopping options are closed but some people just spend whatever they have whenever they have it without thought to cost.

      I try and plan or I try to substitute or do without if I can.

  8. dojo says:

    Excellent tips. It drives me nuts when my husband gets home with another bottle of olive oil, but he does make sense: he’s buying it in advance when he finds it at 20-25% off. We cook only with olive oil and it doesn’t spoil, so it does make sense to stock on it when you find a good price. While I usually make fun of my husband’s way of purchasing it, I have to admit he’s right. We haven’t paid full price for it in a long time (and extra virgin olive oil is pretty expensive here, so you ‘feel’ the difference in pricing).

    Same with other items we use regularly: if you get a good deal and it doesn’t spoil (detergent or toilet paper don’t really spoil that easily :)), it’s good to purchase it at a great price instead of paying more when you really need them.

    • janesavers says:

      Being sensible with every purchase is the secret to good money management.

      I often buy the canola oil blended with olive oil because it is so much less expensive. I am almost out and I am looking for a sale. Oil is not Christmas related so finding a good deal may have to wait until January but I have enough until then. Lots of Christmas related foods are on sale now.

  9. JRod Writes says:

    Hey JaneSavers, I love the way you look at things. And my gosh, using a toilet paper sale to explain all of this. I absolutely love the post and the tips are impeccable. I’ll see ya around!

    • janesavers says:

      Thank you JRod.

      Spending money on something cheap is no different than spending it or wasting it on something expensive. We need to plan each dollar we spend and we will end up with a lot more of them.

  10. dunny says:

    Very entertaining discussion.
    Last year, I visited my sister in another province twice in 6 months and both times she had run out of coffee beans (we are all coffee addicts), toilet paper, and salt. She lives 10 miles from a store, but drives past several stores most days. Incredible!

    I try to be way ahead of myself on everything. I buy 1-2 years worth of TP at Costco, also dish wash liquid, and laundry soap and window cleaner, garbage bags, and nothing else. When I open the last package or container, I put it on the Costco list and replenish. I have to go about every 3-6 months.

    I seem to have no trouble keeping a running inventory in my head of what’s on hand, what needs eating, what I need to complete a meal, and what I need to buy. A quick check verifies the list in my head.

    I don’t run out of anything essential and have never had to go to 7-11 for food — yuck.

    I don’t eat processed food, so I don’t stock up on food on sales or use coupons. My fridge and pantry are pretty much empty and I have to look for the sugar if somebody wants it in their tea or coffee. A few exceptions: at Costco I buy mustard, maple syrup, coffee beans, butter, olive oil, kosher salt, and oatmeal — cheap and good quality. I freeze fruit in summer especially blueberries and tomatoes so don’t have to buy canned or frozen. I dry herbs in summer which eliminates have to buy condiments. I buy meat at Costco and repackage — about 3 months worth — and don’t buy more until it’s all gone.

    One way to save money on food is to eat everything in the fridge and freezer before going shopping again. That eliminates old food and wasting food. And maybe a few weird meals the last few days.

    I agree, one should contribute to RRSP and TFSA at the beginning of the year, but borrowing for the RRSP is much cheaper than not getting the tax refund. I used to do that before I started my new habit of being ahead of myself. I just cut everything out until I had saved enough to always have money for insurance, taxes, and RRSP. That was a great feeling.

    Running out of gas is the worst thing — I forget to check because I fill up so seldom, less than once a month. All the places I go regularly are very close and I walk most of the time. Of course I drive for the Costco run.

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