I know it's kinda expensive, but everything's so top-notch!

Hey folks.

You know what you want?

Yes!

I'd like to eat the Down Payment on a House, with a side of Flambéed Emergency Fund.

Excellent choice.

And for you, sir?

I'm pretty hungry, so I'm gonna have Our Retirement Savings, and... what the heck, a bottle of Our Daughter's College Tuition.

Very good.

Do you think we spend too much on dining out?

Maybe… but everyone else is doing it.

Besides, what's the alternative?

Cooking at home?

At least the breadsticks are free.

21% of Americans have no retirement savings, and another 10% have less than $5,000.

It's even bleaker for millennials:

nearly 6 in 10 have nothing saved at all.

Now, there are a lot of reasons for this:

the increasing cost of housing, health insurance, and of course, student debt.

But for many people, those costs are relatively fixed.

If you're looking for practical areas to cut back, one sticks out like a fly in your soup:

dining out.

In 2015, for the first time in history, Americans spent more money on bars and restaurants than on groceries.

With the average household now spending more than $3,000 annually on “food away from home,” representing between 5 and 7 percent of their total spending.

Even though restaurant prices are increasing faster than inflation, and grocery prices are holding steady－or even falling!

The average diner is still eating out around 5 times a week.

How much is this costing us?

Well, restaurants typically mark up their food by around 300%, meaning the price on the menu is about 3 times what they actually spent on the food.

If that seems like a lot, remember, you're also paying for the restaurant's rent, labor, equipment and overhead.

So if you live in an area where real estate values are increasing, that also applies to the surface area of your local restaurant's tabletops.

And that doesn't even include drinks!

A survey by Zagat found that the average restaurant bill per person is over $36.

If you do this just 3 times a week, that's over $5,600 a year!

By contrast, the average meal cooked at home with groceries from the market is about $4 per person.

Now you can see why so many financial advisors focus on dining out as a place to save money.

How much money could you potentially save?

I think it's time to…Run the Numbers!

Let's say Jake here goes out for dinner 3 times a week, spending $35 each time.

He starts every workday with a latte and croissant at his local coffee shop and buys lunch at the local food court 4 days a week. (Fridays are pizza day at the office.)

In one year, he's spent over $9,000 on commercially prepared food and drinks--

over 12% of his yearly salary of $75,000.

What if Jake could get those 3 dinners down to just one a week?

And what if he started making coffee and breakfast at home, and brown-bagged lunches at work?

Assuming that all those homemade meals would come out to around $5 each, that would mean a yearly savings of $4,420!

That's enough for a Hawaiian vacation!

But wait, we're not done!

What if Jake took those yearly savings and put them into an account earning 7% compound interest?

In just 10 years, he'd have over $65,000.

Enough for a down payment on a house!

In 20 years, he'd have almost $200,000!

All from just eating at home more often.

Jake's example demonstrates that even in an era of burdensome healthcare and student loan obligations, you might have some wiggle-room in your finances.

Even a small cutback in dining out could allow you to finally pay off an onerous debt or build an emergency fund.

This might be easy advice to give, but harder to put into practice.

Many of us dine out because we're too busy or tired to cook after a long day of work.

If we know how to cook at all.

And going to restaurants isn't just about the food.

It's a social event—

a place to see your friends, to connect with co-workers, to take the edge off a stressful day.

So we're not saying "never go out to eat!"

But if you want to cut down on this expense, you first have to know why you're spending the money in the first place.

Is it a convenience or a luxury?

If it's a convenience－

in other words, if you're eating out because you don't have time to cook at home, well, the problem might just be a lack of preparation.

After all, brewing a pot of coffee and toasting a bagel can be less time-consuming than waiting in a Starbucks line.

And can potentially save you hundreds of dollars.

There are lots of resources on the web for how to make shopping and cooking cheap and simple, including this video we made about navigating the supermarket.

But if you're still intimidated by the prospect, you could ease yourself into it by utilizing ingredient-or-grocery delivery services like Blue Apron or Instacart.

These are definitely more expensive than doing your own shopping, but still cheaper than eating out.

We like to use cash at the supermarket to stay within a budget, but if you're trying to incentivize yourself, you could look into a credit card that gives rewards for grocery purchases.

And it's always a good idea to keep some convenience foods like microwavable dinners in your freezer.

That way, on days that you really don't feel like cooking, you'll have an alternative to stopping for take-out or ordering in.

On the other hand, if eating out is a luxury－

that is, if you're doing it for social or psychological needs－there still might be ways to achieve that with less spending.

For instance, you can share an entree.

Restaurant portions are typically much larger than the average diner's appetite, because it makes it easier for businesses to justify high prices.

If you're there for the service and the atmosphere, you can get that without overeating to the point of discomfort or leaving uneaten food behind.

If you have favorite restaurants you know you visit often, it might be a good idea to sign up for their email lists or check Groupon for details.

But beware that these "bargains" are intended to make you visit more frequently.

Same goes for "diner's reward cards".

If you're not careful, these strategies might actually increase your monthly dining expenses.

Alcohol is one of the biggest markups for restaurants, so if you like to have a drink with dinner, you might want to find places that allow you to BYOB.

Similarly, going to an ice cream shop after dinner is usually much cheaper than ordering dessert at the table.

And lastly, if you find yourself buying lunch just as an excuse to get out of the office, no one's forcing you to eat at your desk!

Hopefully.

Take your brown bag to a nearby park or public space.

It's the same psychological benefit without the cost.

Dining out is a big part of our culture, and it might be an important aspect of your social or professional life, so we're not suggesting you cut it out cold turkey.

But you shouldn't accept any large, regular expense without asking yourself three fundamental questions.

How much am I spending on this?

What do I get out of it?

Can I get the same benefit for less money?

And that's our two cents!

Do you have any tips on how to save money while dining out?

Go ahead and share them with us in the comments!