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Have you looked at your bank account recently? How’s it looking? If your bank account looks the same as it did last month, or worse, it’s less than before, it’s time to look at your spending habits. To you, the things you spend your money on may seem worthwhile, but if you really put things into perspective, you will realize just how much of your money you are splurging on unnecessary things.
Let’s dig deeper into common ways how most people waste money without even realizing it!
1. Paying for Insurance Policies You Don’t Need
It’s important to realize that you don’t need every insurance policy out there. Sure, some are necessary, such as medical insurance, life insurance, or auto insurance, but there are some insurance policies that might be a waste of money. These may include travel insurance (if you don’t travel that often), identity theft insurance (most credit cards already come with protections from fraud), children’s life insurance (usually, children don’t have any assets to protect), and so on. To save yourself from this money drain, it’s important to do your research when shopping for insurance policies.
2. Grocery Shopping Without a “List”
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Or… going grocery shopping when you’re hungry!
People can easily go overboard with their grocery shopping if they’re not mindful. The stores themselves don’t do you any favors as they’re designed to make you want to part with your hard-earned money. When you go grocery shopping, it’s crucial to stick to a list and only buy what you need for that particular time period.
That’s not to say that you can’t treat yourself. However, you should do this as a reward for saving a certain amount of money. E.g., if you’ve refrained from buying junk food and snacks for a week, treat yourself to a bag of chips or a bit of ice cream.
3. Investing In Branded Products When There Are Cheaper Alternatives
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Not every item you own should be branded. Shopping from thrift stores or local stores can be a great way to save money, but unfortunately, people don’t take that route very often. Too much dependency on high-end products can be one of the major reasons why your bank balance isn’t increasing.
To do some hard-core saving, invest in appliances, home décor items, clothes, accessories, and other stuff from local brands. If you search properly, you can easily find quality products that are good value for money.
4. Dining Out
Now, we are not saying you should totally stop eating non-homecooked food. However, some people tend to dine out more than they should. According to CNBC’s Jonathan Blumberg reports, people who eat out every workday spend on average $10 per meal, which totals up to $2500 a year!
The Harvard Business Review concludes that 50% of people hate to cook, which is why they eat out, resulting in wastage of money. The best advice here? Learn how to cook! Cooking your own meals will help you save a lot of money, and you can then eating out can be a treat or something you can do after you achieve a goal.
5. Costly Skincare Products
To be clear here, investing in pricey personal grooming products doesn’t guarantee better skin.
Not all costly skincare products work for you, so you may be using them in the hope of getting rid of pimples, or acne, or to look young or beautiful without any results. In fact, the only impact they’re having is on your wallet! As we said earlier, not everything you buy has to be branded. Look for less-premium skincare items when you go shopping for beauty products. Alternatively, you can even try some DIY, natural ways to treat your skin issues.
A lot of people waste their money in casinos and lotteries, with the desire to make it big keeping them coming back again and again. Even though stakes are involved in gambling and the chances of winning a lottery are bleak, that doesn’t stop people from taking the plunge. Unfortunately, people end up losing a great deal of their money in this process.
The best way to approach gambling is to use money that you can afford to spend. If you’ve accounted for your monthly expenses, set aside some money for saving, and still have money left over, then you can use that money to gamble. However, know when to stop, and don’t ever dip into your savings to gamble.
7. Paying Full Prices for Everything
Not taking advantage of sales and discounts can really burn a hole in your pocket over time, as you have to pay full price for everything. Keep an eye on holiday sales or seasonal discounts to get high-quality products at a reasonable price.
Also, if you can bargain to get the price down, never pass up the opportunity to do so!
This will come as no surprise to anybody, but using your HVAC system unnecessarily can lead to costly electric bills. This is why people always advise you to use electricity wisely. Switch off extra lights, turn off appliances when not in use, turn off the air conditioner when nobody is in the room, etc. Making these slight but effective tweaks to your lifestyle can prevent you from wasting a whole lot of money on electric bills.
9. Being Disorganized or Careless
This bad habit can cost you money at some point in time. You may damage or lose your important things if you don’t look after them or keep them in the wrong place. As a result, you will have to buy them again, so in a way, you will be spending your money unnecessarily.
10. Using Unnecessary services
If you want to know how most people waste money without even realizing it, look at their spending habits when it comes to things they can do on their own for free. These include laundry services, online grocery, spa services, etc.
You don’t need to hire professional services for laundry or grocery – or any other service that you can do yourself. Take some responsibility for your daily tasks and save some money in the process.
This blog post on how most people waste money might not be an eye-opener for many, but ask yourself honestly – how many of these traits are you guilty of? If it’s more than 3, you now know why your bank account continues to suffer even though you’re probably doing your best to save money. Keep the tips mentioned above in mind and enjoy the money that you save in the long run.