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How to Eat Steak on a Budget

Do-it-Yourself Steak: Making the Cut
Filet mignon: worth every effort.
Filet mignon: worth every effort.
Stephen Walls/iStockphoto

­If recreating a restaurant-style meal at home is so easy and inexpensive, why go to the steak house at all? At Ruth's Chris, or any other steak house, relaxing and enjoying the company of friends at your table is part of the price. At home, it's the steak lover on a budget who's whipping up the blue cheese dressing by himself and hopping into the car for a quick trip to the liquor store to pick up bourbon for the bread pudding. The difference, in other words, is elbow grease. Preparing steak at home cuts costs dramatically, but becoming a savvy and creative shopper and chef can reduce the price of a steak dinner even further.

Where does knowledgeable steak shopping come in handy? Let's consider the priciest steaks first. Filet mignon is among the best cut of meat any cow has to offer. These steaks come from the very soft, low-fat and tasty tenderloin area. They're also among the most expensive steaks, but eating steak on a budget doesn't mean that you have to forgo them altogether. Part of the expense of buying a cut of filet mignon is the trimming that's required. In most stores and at restaurants, the filet mignon served is cut from the center of the tenderloin. By agreeing to buy the whole section of tenderloin from which the filet mignon is cut, a budget-conscious steak fanatic can really save some dough.

Buying a larger cut of meat to save money doesn't make much sense, so why buy it? This large section is called a peeled, skinned and muscle side off (PSMO) section of the tenderloin. As the name implies, a great deal -- but not all -- of the butchering has already been done. Buying a PSMO can cut the price per pound of filet mignon by more than half. Basically, it's the difference between $9 and $20 per pound at some wholesale clubs [source: Cooking Light]. The PSMO cut of tenderloin is relatively large and can weigh several pounds. Compared to purchasing a pair of pre-cut filets mignon, the cost may even out. The PSMO could be more expensive, but you've also bought a lot more meat. In the end, it makes financial sense to spring for the PSMO, especially when you're throwing a dinner party.