Ever since you started earning money, your parents told you “don’t waste it!” They wanted you to learn to be smart with your finances, even at a young age. You learned to really think about the purchase before you handed over your hard earned cash. But, are you still making mistakes and wasting money?
However, as we get older, it seems that we forget this simple idea. We spend money on things we think we need. Often times, these are just a waste of money.
HOW YOU ARE WASTING MONEY
1. CREDIT CARD INTEREST
While I know many people pay off their cards each month (good for you), many do not. Instead, they charge and then make the minimum payment. The problem with this is that it is the best way for you to waste your money.
If you want to use a credit card, if even for the perks you might get, then you need to use it in the right way. Never charge more than what you have available in cash to pay for. You should not even charge in advance of a paycheck coming your way. What would happen if you suddenly lost your job? Would you really pay off your card or would you hold onto it to cover upcoming expenses?
2. CABLE TV
This is a sneaky was you are wasting money. Cable companies love to charge people money – and lots of it. If you look at the number of channels you pay for each month vs. the number of channels you actually watch, you quickly realize that you are absolutely wasting money.
The average household pays around $960 per year for cable. If you subscribe to even 3 monthly services at $9.99 each and also pick up Amazon Prime for $99 per year that is an annual amount of around $459. That is a savings of nearly 50%!!
What you can do is try to find other alternatives to getting the programming you want. There are services such as Sling TV, Hulu Plus, Netflix and more.
3. NEW CARS
Car Dealers love to try to convince you to purchase a car that you really can’t afford (and really, probably do not even need). While the interest rate may seem too good to pass up, it really can be a poor investment. The reason for this is that depreciation occurs so quickly that you end up owing more than your car is worth — even if it is brand new!
Instead, opt for a used vehicle with low miles. You can find really great deals and can sometimes even negotiate the price down a bit more easily.
Before you ever shop for a car, you need to know how much you can afford (keeping in mind your annual taxes and insurance in addition to any payment). Don’t even test drive something that might be outside of your budget.
Stick to your guns and do not fall for the lure of the salesman – who is just trying to make you spend more so he can make a larger commission.
4. OVERDRAFT FEES
In 2016, banks made $11 billion in overdraft fees. That is a serious waste of money for the American consumer!
If you find yourself living paycheck to paycheck or even robbing Peter to pay Paul, overdrafts often occur. However, if you do not follow a budget you can actually force yourself into spending more money than you have available, which in turn can generate overdraft fees.
Make sure you account for every dollar coming into your home and do not spend it unless you have it. This is where you MUST have a well-written budget. Make sure you never write checks before the money is in your account.
5. GYM MEMBERSHIPS
We all have great ideas that we are going to go to the gym and workout. We buy the discounted membership and go a few times and then stop.
Rather than even pay for a gym, just go online to YouTube and you can find video after video offering an at-home workout. You could also use what is around your house such as your stairs for your own stairclimber routine, the sofa to do reverse push ups…and more.
Really think before you purchase a membership. Try to do it a home first. If you can’t keep up the routine when it is free, then chances are you will not do so when you pay for it either.
Read More: 6 Different Ways to Workout for Free
6. MORNING COFFEE
I know that many people think that they just need that morning coffee to get going. But why pay for it? You can make your own coffee at home — for a LOT less. Find flavored syrups or add-ins to create your own unique flavor combination.
If you really MUST have your coffee, why not set up a gift card that you load at the beginning of each month. That will be your total allowance for the month. You’ll think twice before driving through to grab that cup of Joe on your way to work.
OK. You are probably thinking – food? We need food! Yes. Yes, we do. However, how much food goes to waste by going bad before you can eat it?
Make sure you always shop with a menu plan and a shopping list so that you purchase only what you need and can eat before it spoils. Smart planning is key to saving money here.
8. DINING OUT
This is really a continuation of Step 7 above. When you do not plan your meals out and have items on hand, you might run out to dinner rather than dine at home.
I am not saying that dinner out is something you should give up. Not at all. Just be wise when you go out to dinner.
One way to do this is to skip the appetizer. When you add this to your meal, you may find that by the time dinner arrives, you are too full to eat it! Not only that but do you really need to eat something while you wait for your entree to get to your table?
Another simple way to save when dining out is to make sure that you are not purchasing soft drinks. They charge you $1.99 (or more) and say that you have unlimited refills. Sure, that sounds great, but do you really drink $2 worth of soda? Probably not. Just get water and you’ll instantly save.
9. EXTENDED WARRANTIES
Have you ever purchased an extended warranty? How many of them have you ever used? These are not created to help you, but rather make the retailers a LOT of money. This is another trap which assists you in wasting money.
Yes, there are times when something breaks, but the majority of items do not. That means you are throwing money out the window. If you want to really get additional coverage, make your purchase with a credit card that offers additional warranty coverage at absolutely no cost to you. Just make sure you follow step 1 above when you do!
10. LEAVING ELECTRONICS PLUGGED IN
We all know that we should turn off the lights when we leave a room, as that is just a waste of money to leave them turned on. What people don’t realize is that by leaving electronics plugged in when not being used can do so too!
Even a few dollars here and a few dollars there can all add up to additional utility expenses each year. Just take the time to unplug things not in use and you’ll find some instant savings.