Money-wasting things you should avoid
Save Money Tips: You should keep track of your spending as inflation drives up the price of almost everything.
Consumers can often spend more than they need to on certain expenses over time, despite being budget-conscious.
We’ve compiled seven money traps you might be falling victim to — and how you can avoid them.
- Bank fees
Paying small fees can add up to a considerable amount of wasted money over time, whether paying for a withdrawal at an out-of-network ATM or a monthly checking account service fee. A Bankrate survey reported last year that the average monthly cost for non-interest checking accounts was just over $5, while those who did not meet the requirement to waive the fee paid more than $16 for interest-bearing checking accounts.
Change banks to reduce waste. Bankrate found that nearly half of the checking accounts in its database did not charge any monthly maintenance fees. You probably won’t gain more interest in that account if you cannot avoid monthly fees with your current bank.
- Don’t buy sale items.
A bargain purchase is sure to give you a thrill. Overspending while shopping on sales can lead to overspending if you purchase something you don’t need.
Wait 24 hours before purchasing something for sale the next time you’re tempted. In many cases, you’ll be able to walk away from a deal after the initial excitement disappears.
- Subscriptions that you don’t use anymore
Approximately 70% of consumers waste more than $50 per month on recurring payments that they do not need or want, according to a Chase study from last year. Consumer analyst Julie Ramhold said people are frequently enrolled in free trials and fail to cancel them once the trial period expires, which is a major contributing factor.
As Ramhold points out, these types of payments often go on autopay, so people aren’t even aware that they are putting money toward things they don’t even use. “That’s a great way to waste money.”
Take the time to scrutinize your statement each month to make sure you don’t see any charges you don’t need, even if you’ve set up your credit card for autopay.
- Food waste
Approximately 40% of food is wasted, according to the Natural Resources Defense Council. Despite wilted salad greens and leftovers brought home after dinner out, it is not uncommon for families to waste food.
Check your refrigerator before heading to the store to save money. Consider the items you already own when planning your meals (and shopping list). As a result, you will to purchase new groceries that go to waste since you will not only be able to use the items before they go bad, but you will also save money.
- Extended warranties
According to Ramhold, extended warranties aren’t always a good deal for consumers, whether it’s for a car, appliance, or electronic device. The plan may cost more than the cost of possible repairs, or it may not cover the problems you are facing, said Ramhold. You may also pay for coverage you already have with extended warranty coverage on certain credit cards.
Put your extra money into an account that can be used to repair occur instead of paying for an extended warranty. You can skip this expense if you already have an emergency fund fully funded.
- Overpaying for insurance
Insurance costs tend to increase over time, especially if you’ve been with the same provider for a while. Shop around if you want a better deal.
Andrea Woroch, a consumer savings expert, said that new customers get new customer deals. The same or better coverage may be available for less with a different policy.”
Compare insurance quotes online with sites like TheZebra.com and Policygenius. You can use quotes when negotiating for a better rate if you’re satisfied with your current provider and coverage.
Increasing your deductible or bundling your auto and home insurance will also help you save money. As a result of those two steps, Woroch recently saved $1,100 per year on her insurance bill.
- Credit card interest
The Consumer Financial Protection Bureau estimates that American households spend $1,000 per year on high-interest debt and fees on credit cards. Whenever a balance is credited on a credit card, it becomes an expensive burden that can negatively impact your finances.
Putting your cards on hold while you pay down your existing debt is a great way to cut waste.
Ramhold suggested using a debit card or cash card instead of a credit card if you have credit card debt.
edited and proofread by nikita sharma
