How to Eat Your Way to Financial Freedom
“The cornucopia that greets you as you enter the supermarket dwarfs anything that Louis XIV ever experienced…you can decide on a whim to choose between scores of nearby bistros…in each of which a team of skilled chefs is waiting to serve your family at less than an hour’s notice. Think of this: never before this generation has the average person been able to afford to have somebody else prepare his meals.” — Matt Ridley, The Rational Optimist
Our Favorite F Words Part 1: Food & Finance
Over the next few weeks we’ll be diving in deeper to our favorite F word, Finance, and how it relates to the other important F’s in our lives, Family, Friends, Fun and more. But this week there’s no better place to start than Food.
There are two main ways the average American gets her food: groceries and restaurants. Restaurants were once special occasions, so the vast majority of people ate food at home that they bought (or farmed) and prepared themselves. Today, fewer than two percent of Americans live or work on farms, so our surplus income and time deficit leads us to buy takeout on our way home from work, eat out on the weekends, and when we do find time to visit the grocery store, we choose Hot Pockets and Easy Mac over swiss chard and carrots.
This phenomenon, of course, is no surprise. Everybody knows that we’re getting more obese and that food manufacturers entice us with chemical concoctions not found in nature. They do it so cheaply that it makes buying what Michael Pollan would consider “Real Food” less appealing. Not an ideal situation, but what on earth does it have to do with personal finance?
Some foods are undoubtedly good for us, like leafy greens, lean meats, whole grains, nuts, and Ring Pops. Ok maybe not Ring Pops. Those would go in the second category of foods that we should definitely avoid, like anything on the Cheesecake Factory menu, or ingredients that sound like they’re from a sci-fi movie. The trick is to eat as much of the good foods as possible without breaking the bank. That means trying to find ourselves in the top left corner of the diagram below more often than not.
To achieve this goal, we need to understand why we want to jump into the other three quadrants of the chart so often. First, let’s tackle the option furthest from where we want to be, eating expensively and poorly. This category is home to 80 percent of the restaurants we frequent, as well as silly specialty items we get from the grocery store like rare cheeses or any of those prepackaged meals from Trader Joe’s that are always smaller than we expected.
When we eat at restaurants, every calorie we consume is tremendously expensive because not only are we paying all the farmers and suppliers who produced the raw ingredients, we’re also paying for the chefs, the waiters, and the restaurant’s mortgage. Going to a new restaurant or an old favorite every now and then is fun, but going every week takes the magic out of it, making us poorer and fatter in the process.
But some of us are more sensible than that, or at the very least we’re on a budget. Sometimes we move to the upper right corner of the chart and buy food that’s cheap but still pretty bad for us. This includes 10 percent of restaurants and the majority of our purchases at the grocery store. The kings of fast food like McDonalds are in this category because they actually can provide a meal to us as quickly and cheaply as we can do it ourselves. The catch is, the meals they produce are rarely good for us.
Whether it’s a processed cheese log you use to make queso or a piece of fried chicken that’s been sitting under a heat lamp all day, this stuff is not a good deal for future you. It’s cheap and it’s tasty, but I can almost guarantee that the medical bills it causes won’t be. By and large, folks who eat well live healthier lives, unencumbered by heart disease, diabetes, and high blood pressure. In the long run, even moving into the lower left corner of our chart would be a better move for our health and our wallets. So that’s where we’ll turn.
If you’ve ever bought food from a place that only sells fancy artisan salads, you fall in this category. We want to eat healthy and make sure all of our foods are organic, free range, low sodium, gluten free, and dressed in clothes from Pottery Barn Kids, but it’s hard to find the time to make it. So we buy everything from Whole Foods, grow our hair out, and tweet about the environment. The problem is we spend an incredible amount of money doing so.
So how do we move into that coveted upper left corner of the chart? It depends. The first thing we have to ask ourselves is “Which of the other three quadrants do I spend the most time in?”
Let’s say we’re stuck in organic land down in the lower left corner. We’re eating healthy but not smart. We might want to buy leafy greens in the organic section, but apples, carrots, and tomatoes with tougher skin won’t transfer chemicals to you if you wash them well. It’s way more important that we eat an apple rather than a slurpee than it is that we eat an organic apple rather than a regular one.
What if we eat well at restaurants like our fancy salad connoisseur? It’s really beneficial to stop thinking of restaurants as sources of food and to start thinking of them as sources of entertainment. We might consider eating well at home and occasionally joining friends at a restaurant for a drink and an appetizer. When we no longer think about restaurants as an alternative to the grocery store, we tend to visit them only for special events.
Maybe eating healthy isn’t at the top of our list and we find ourselves dangerously far to the right of the chart. If we’re in the top section, we should think of our future selves, unable to even put a Ring Pop on our fingers because they’ve swollen to the size of salty sausages (which sound awfully good right now). Slowly backing away (or briskly jogging) from that future, we turn to the bottom right side of the chart.
For those who both destroy their waistlines and wallets, I have no immediate and actionable advice. We actually have a good thing going on down in this corner. We’ll be dead from heart disease, diabetes, hypertension, high blood pressure, stroke, heart attack, or something else health related soon enough. So we don’t have to plan for the future. We can spend all our money at fancy restaurants now!
For people in that bottom right corner, I have even more fake advice. Take up smoking, another expensive pastime that whittles away at your health at breakneck speed. The only problem, of course, is it suppresses the appetite, so we’ll have to take extra care to commit to our previous hedonic lifestyle. I have faith we can do it. We’ve never turned down a cronut before, why should we stop now?
“But how does this affect me?” you might be wondering. “I love cronuts, but I also splurge on salads. I’ve eaten at McDonalds and I shop in the organic section.” Well, that tells me you’re human. Most of us don’t fit into neatly into any one quadrant because our wants change from time to time. Luckily, we can use that to our advantage. Because we’re human we are constantly striving to become the best possible versions of ourselves. We want challenges, and we want to learn. We want to be wealthy, healthy, and happy, we just find that we stumble from time to time. Perhaps all it takes is a little motivation.
In that case, I have a challenge for you. Keep a food journal for 30 days. Write down everything you eat, however small, and write down how much it cost (either individually if you are at a restaurant, or in aggregate if you are buying lots of things at the grocery store). Changing our habits for a full month isn’t easy, but if you want to guarantee success, share your food journal publically. Whether to your friends or to the world, in real life or on Facebook, hold yourself accountable by letting others hold you accountable. Because when we work together to become better, we are at our strongest.
Nathan is the CEO of Monte Largo Financial Advisors LLC.