Think of all the times you wasted your money. I have thought of 10 things people do to waste money, so hopefully I can prevent more people from wasting their money after they read this article. 🙂 Let’s stop wasting our money and invest it!
1. Buying on impulse. Think before you buy and give yourself time to shop for the best price before making the decision to purchase. You can often save money by buying online rather than purchasing at the brick and mortar store, or better yet, remember that you don’t need the thing you want to buy.
2. Buying/renting a bigger home/apartment than you need. Americans spent about 12% of their income on energy and transportation costs. In 2011, that number is estimated to be about 20%. Although people try to live in as big of a house as they can afford, think about how much your heating and electrical costs go into the unused spaces in your house. Also, bigger apartments/houses require more maintenance, more furniture, more effort in cleaning, higher taxes, ect.
3. Eating out too much. Americans on average eat at a restaurant/fast food every third day. Be conscious about cutting back on trips to Mcdonalds or your favorite restaurant at least once a week. Not only will you be saving money, but you may also lose weight.
4. Ignoring routine maintenance (car, house, spouse) in the short-term so it costs you much more (engine overhaul, new furnace, jewelry) in the long-term.
5. Keeping unhealthy habits. Smoking a pack of cigarettes a day at $6 each costs more than $2,000 a year. The U.S. government estimates the actual cost is closer to $10.47 per pack, once you add in the medical expenses smokers will face, including insurance costs. Excessive drinking is also an expensive and destructive and unhealthy pastime.
6. Playing lottery. The odds are so stacked against you that it is safe to say you will never win. Not even if you lived for five more lifetimes… The lottery is often considered a tax on the poor because only the poor and financially uneducated purchase lotto tickets. I don’t know about you, but I only bet on things when the odds are in my favor.
7. Buying books. Make a trip to the library first to see if they have the latest best seller to borrow for free. You can also borrow movies and CDs too.
8. Buying name brand vs generic. Things like name brand prescription drugs vs generic drugs are virtually the same, and so you can save a ton by opting for the store version. You can also save at the grocery for things like water, spices, cleaning supplies. For these types of products, can you really tell the difference between name brand and generic?
9. Buying brand new. Getting something in the original packaging often means paying twice the price. This mistake is most costly when it comes to cars, but it also applies to things like furniture, clothes, shoes, textbooks, etc. So whenever practical, skip the stores and showrooms and choose thrift stores, yard sales, eBay and Craigslist. For things like cars, it may be good to buy new and get its use over a long period of time (10+ years). However, be sure that you do not pay sticker price for the car. Don’t be afraid of the inherent conflict and uncomfortable situations that would arise in negotiating the best price. An extra 4,000 deduction is a lot of savings. Also check out freecycle.org for free things.
10. Carrying a credit card balance. If you have a credit card balance of $1,000 with an interest rate of 18%, you are wasting $180 a year.