# Gasoline, Groceries, and a Simple Look at the Cost of Time

Recently, my wife was in rural area of Iowa where the gas prices were significantly higher than they are near where we live. While there, the amount of gas in her tank got low, so she stopped to fill up. After looking at the price and doing a quick bit of mental math, she chose to only put two gallons of gas in the tank.

Upon returning home, she stopped at a nearby gas station that consistently has very low prices and put another nine gallons in her tank, filling it up, and saving about seven cents a gallon added – sixty three cents, total.

When she got home and told me this story, I was fairly surprised. Making an extra stop for gas just to save sixty three cents somewhat threw me.

“Why didn’t you just fill up before you left that town?” I asked her.

She shrugged her shoulders. “The gas is cheap enough here that I thought it would be worth the stop.”

Being the analytical people we both are, we decided to turn to the numbers. First, I needed some accurate data on how long it would take to fill up a tank of gas. I stopped myself to fill up my truck – with a twenty gallon tank – and the entire stop took me just shy of six minutes. If you filled up a ten gallon tank, four minutes would be a reasonable estimation for a stop.

So, calculating based on that, stopping to save seven cents a gallon on gas actually saved us money at a rate of \$9.45 an hour after taxes. That’s reasonably good – better than it might seem at first glance.

But it’s actually more than that. Let’s say she normally puts ten gallons in her tank during a four minute stop. Half of that time is spent parking, getting out, setting up the pump, and then turning it off and driving away afterwards. So, she pumps in the ten gallons in two minutes – a rate of a gallon every twelve seconds or so.

Her two gallon stop thus took her a total of two minutes and twenty four seconds. Her nine gallon stop took her three minutes and forty eight seconds. Add them together and you get six minutes and twelve seconds – not eight minutes.

So, she actually only invested two and a quarter minutes in pumping twice.

If you figure based on that number, she actually saved money at a rate of \$16.80 by pumping twice – plus she has an extra gallon in the tank, which means she won’t have to stop again as soon.

What’s the conclusion here? Even if it seems a bit counterintuitive on the surface, it’s often worthwhile to make an extra stop if you are completely certain you can save money with that extra stop.

I use a simple rule of thumb for this – if I’m not doing anything particularly productive with my time, I’ll often jump on board with anything that’ll earn me at least \$15 an hour in savings. In her situation, that’s exactly what she did by pumping twice compared to filling up just once.

This type of analysis reasserts itself with grocery shopping. There are several grocery stores in Ankeny, Iowa. The grocery store with the best selection of the items we buy is Hy-Vee. However, the best prices on staples can usually be found at Fareway.

If we had several specialty items on our list (like a particular kind of cheese or something along those lines), we would just do all of our grocery shopping at Hy-Vee, even though we’d pay a bit more per item for our other items. The only time we would split it up into two store stops is if we had an enormous grocery list.

In truth, if you’re buying more than just a few items, the amount you save for the extra time invested is probably worth the second grocery store stop. How so? If you figure that you’re familiar with the layout of both stores, it doesn’t take too long to find a particular item – let’s say thirty seconds per item to be fair.

Let’s say I can save an average of a quarter per item buying a staple item at Fareway, but we have to stop at Hy-Vee for some specialty items.

If we stop at just Hy-Vee, we invest ten minutes in getting out of the car, finding the cart, getting into the store, checking out, getting out to the car, and putting the items in it. If we stop at Fareway, we have to do that twice – twenty minutes. A ten minute addition for stopping at Fareway. However, the time actually finding items in the store is equal and, if anything, slightly favors Fareway because the store is smaller.

Let’s say I need an hourly rate of \$15 in savings to make the stop worthwhile. The extra Fareway stop eats ten minutes, so I’d actually only need to save \$2.50 there to make that \$15 an hour rate. If I’m saving an average of a quarter per item, if I’m buying only ten staple items, it’s worth making two separate stops for groceries.

What’s going on here? To put it simply, if you know exactly what you’re shopping for and have at least a solid idea of where you’ll find the best price on a particular item, stopping at multiple places to buy groceries or doing things like only partially gassing up actually really pay off – much more than you might think on the surface.

Most people look at a quarter and just see a quarter – no big deal. A better way to look at it is to ask yourself what it really takes to get that quarter. At some point, the effort is worth it – and if you find that level, why not just keep doing it again and again? After all, quarters really add up.

If you want to get rich, watch the pennies and the dollars will take care of themselves.