Saving and spending money wisely is a lesson that has been taught to almost every person since they were young. From having a piggy bank to save a percentage of your allowance as a kid, to having a swear jar where you had to put in some money whenever you swore as a teenager. You are older now, and you know the value of money and the importance of spending it on only the things you need. And yet, you often find yourself using all of it and having nothing left to save. If you often struggle with spending your money, here are a few things you should consider cutting off because they are a waste of money.
7 things you should stop spending your money on
1. Overpriced or expensive things
It is very tempting to splurge on things when you have a large amount of money or even when you have some extra cash. Some of the things you might be overspending on include; expensive new houses, high-end vehicles, fancy clothes, and expensive vacations. Another example of poor use of money is buying an extravagant wedding dress or a tuxedo that you will only wear once.
Buying these expensive items is a bad spending habit and can deplete your savings. Unless you have an endless supply of money or intend to resell the items at a higher value, it will run out eventually, and some of the things you bought, such as cars, will have depreciated.
You should spend your money wisely and avoid using it on pricey things. You could probably rent or get the same items/experience at a cheaper price elsewhere.
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2. Excess and unnecessary commodities
How often do you find yourself purchasing something or excess items, thinking that you will need them in the future then end up never using them? For instance, buying extra groceries thinking you might need them, only for them to get spoilt in the fridge because you forgot you even bought them. You can save more money by buying just enough of what you need.
Another bad spending habit you need to get rid of is impulse buying things just because they caught your eye or are on offer. It makes you go above your budget and hence reduces the funds available for other activities. If you are trying to learn how to become rich, spending only on the things you need and saving or investing the rest is wise.
Limit spending money on things that you can make for yourself or bring from home. For instance, don’t waste money on take out, buying coffee, eating out, bottled water, or shopping bags if you can get them at home. (Read more on sustainable living here)
Additionally, making some DIY items can help you save money because the pieces needed to assemble them are usually pocket-friendly or they can be made from old items. For example, you can make your own gifts, cards, laundry detergent, paper towels, and napkins instead of purchasing them.
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3. Late fees and interest
A late fee or overdue fine is an extra amount charged when one fails to pay their bills or return a borrowed item by the due date agreed upon between them and a company/organization.
Late fees can apply in places, such as; libraries when you fail to return books by the agreed date; movie shops when you don’t return movies you rented on time; when you fail to pay house rent by a particular date; or on credit cards when you don’t meet your monthly minimum payment. It often increases at a given rate per day/item. To avoid spending extra money on late fees, ensure to return borrowed items on time and pay your rent by the required date.
On the other hand, interest is charged on loans and debts by banks and credit organizations. Avoid having to spend money on interest charged on credit cards, loans, and debts by;
- Paying the balance on your credit card each month and not letting it gain interest,
- Not taking loans or borrowing money
- Paying your loans and debts before their due date, or
- Repaying your loans in a lump sum to finish them early and reduce the interest.
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4. Lottery tickets and Ponzi schemes
Today, everyone wants to make some quick money and get rich, and it is no surprise that people still get tricked into joining Ponzi schemes and others still try to win the lottery. Even with the knowledge that their chances of winning are slim, they continue buying the lottery tickets because of the lure of getting rich quickly. However, the odds are NEVER in your favor, and if you do finally win, you might have spent more money on tickets by that time. Playing the lottery is a waste of money and can also be addictive! It is wiser to put that money into better use, for instance, by investing it or depositing it into a savings account.
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5. Brand names
Having a popular brand name doesn’t always equal quality. However, due to herd mentality, most people prefer to buy from big brands, believing their goods and services to be superior. While you might trust purchasing products from a familiar brand, sometimes they are too expensive, or you might get poor customer service. Opt instead for a smaller, lesser-known brand that is still growing, if its products serve the same purpose. Not only will you find the same items at a more affordable price, but they might also have better quality and service because they are more concerned with customer satisfaction and retention. Some things you should consider buying from smaller brands include foods, bags, gadgets, clothing, and shoes.
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6. Cable TV
Come on, with all the available streaming options today, why are you still wasting your money paying for cable TV? Cable is expensive, and the available channels and programs might not always be to your liking. Choose, instead, to subscribe to the various streaming services such as Netflix, Amazon Prime Video, Hulu, Apple TV, Roku, and many others. They are much cheaper and have a wide variety of content to choose from and watch at any time, wherever you are.
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7. Subscriptions that you rarely use
Have you ever registered for a gym membership only to go for the first few weeks then stop entirely? Or you subscribed to services such as video streaming, phone airtime and data, and music streaming platforms that you rarely use anymore? You might blame it on the lack of time to use them and say you only need to know they are there, but the fact remains that you are spending money on something you aren’t using. If you are hesitant to cancel the subscriptions, you should monitor how much they cost you and decide whether you are willing to waste that amount of money knowingly.
Spending and saving money are two sides of the same coin. The more you spend, the less you have available to save, and vice versa. Starting today, learn to spend your money wisely. Identify the things that you should stop buying and use your money only on those that you need. Splurging once in a while is okay as long as you don’t turn it into a habit or spend all your savings. You could set some money aside for when you want to treat yourself to something. Start saving and spending your money well today; your future self will thank you for it!
Are you good at spending and saving your money? How do you do it? Do you know any other things people should stop spending their money on or more money-saving tips that work for you? Please share.
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