You may be pretty confident that you’re good with money. You create a budget and strictly follow it, you pay all your bills on time, and you’ve got some savings. But, did you know you may still be wasting money and you don’t even realize it?
Even the most budget-conscious can fall into the trap of unnecessary spending, whether it’s leaving the lights on when no one’s home, buying food you don’t eat, or paying for services you rarely use. So, budget-conscious or not, chances are, you may be wasting money too and you don’t know it!
In this post, let me walk you through the most common spending pitfalls that many people are wasting money on. If you could avoid these, I am sure you could free up more money to achieve some of your financial goals faster. It could help you boost your savings, pay off debt faster, build an emergency fund or perhaps fund a vacation.
So without further ado, here’s the list. Hint: Don’t waste FREE money with #9!
This post contains affiliate links which means I may earn a small commission if you used a service/product through these links. Please see my Disclosure for more details.
1. Overspending on name band apparel
According to the Bureau of Labor Statistics, American families spend an average of $1,800 on clothing, and this amount could go even higher if you’re so brand-conscious all the time.
I know that most of us like and trust a good brand but you could always get brand-name products without paying full price. Pocket a couple of dollars by checking out overstock stores where you can buy name-brand products at a cheaper price. If you don’t mind getting quality second-hand brand name products, check out Poshmark.
2. Not getting refunds when prices drop
After shopping online, I bet you don’t go back to the store the next day to check whether the price of the item you bought dropped. I mean, who has the time to do that? Even if you do, filing a price adjustment claim to get refunded for the price difference can be a hassle and time-consuming.
But, there is an app called Paribus that can do just that.
Paribus can help you get the price difference back into your pocket so you don’t waste those savings. It automatically tracks your online purchases and pays you back the price difference when they detect a price drop for any item you ordered.
I have been using Paribus for a few months now and not only it did help me get refunds when prices drop, but it also paid me for late deliveries.
I love using Paribus because it assures me that I am getting the best deals each time I shop online.
3. Buying food you don’t consume
It’s easy to justify why we spend so much money on food: we need it to survive. But let’s be honest, do you consume all the food you buy? I bet you don’t.
Americans spend 11% of their take-home pay towards food. On average, American households spend $7000 a year on food and the average household spends at least $3000 a year on dining out alone. This makes food one of the top 3 expenses we spend money on per year.
Sadly, based on this website, 20% of food that the average American buys is never eaten!
If you also waste food like most people, try meal planning.
Apart from the money you get to save when you plan out meals, what I also love about meal planning is that it helps us become more intentional about the food we eat. We get to eat more healthy foods more often than when we didn’t make meal plans at all.
If you need help with meal planning or don’t have time to do it, I recommend the $5 Meal Plan ( $5 meals for the entire family). For only $5 a month, you will receive a delicious meal plan per week + a shopping list to help you save money and time.
Most meals you could create with the help of the $5 Meal Plan only cost $2 per person or $5 per family, so it’s definitely a great tool to use if you want to save money on food.
They are currently offering a FREE 14-day trial through this link. You can cancel anytime with no questions asked so it is absolutely risk-free!
4. Spending on the latest gadgets
Buying the latest gadgets is one of the quickest ways to waste money. Once that shiny smartphone is in your hands, its value depreciates. The old and newer version of any gadget are also very similar anyway even though the latest model has slightly new capabilities. Why spend hundreds to a thousand dollars for a little upgrade?
5. Not negotiating on your bills.
Many bills, such as insurance, internet, and phone/cellphone, may still be negotiable, and you may be wasting money on these bills by not negotiating your rates.
By making a phone call to your service provider, you may be able to lower your rates, get extra credits, and even qualify for promotions or discounts. For instance, my husband got a discount on these services as a veteran.
You might qualify for discounts too and you might not know it. So, check out your plans and call your service providers for more details.
Or better yet, try the Trim Financial Manager.
Trim is a free virtual assistant that can help you with canceling old subscriptions, setting spending alerts, checking how much you spent on ride-sharing apps the previous month, and automatically fighting fees. It can also negotiate your Comcast bill, find better car insurance, and more!
Trim has helped save its users over $1 million in the last month!
6. Wasting Electricity
If you want to save money while saving the environment, then stop wasting electricity. Wasting electricity is one of the most common ways people are wasting money. From not using the lid that came with your pots and pans to constantly washing your clothes in hot water or still using incandescent light bulbs, there are many ways you could be using electricity unecesarily. Learn more tips on how to save energy and save money here.
7. Buying drinks and coffee from cafes and vending machines
According to a report from Acorns Money Matters, the Millennials are spending an average of $3 on coffee each day, or around $1,000 per year. Unfortunately, the same report also reveals that millennials also tend to spend more on coffee rather than invest in their retirement.
Realizing that each sip of branded commercial coffee bought outside has been costing us some money, we have since stopped buying drinks from the vendo and have also opted to brew our own coffee at home. This has freed up a couple of dollars in our monthly budget, which we put towards our financial goals.
8. Paying for Cable
I find cable a completely unnecessary expense because in reality, most people really don’t spend a lot of time watching TV. You are probably not home for over 8 hours at least five days a week, so why pay full for something you don’t use full?
According to move.org, the average cost of cable is $100 per month or $1200 per year and that’s already a good amount to save for other needs!
So 5 years ago, we cut cable and switched to Hulu (another option is Netflix). It only costs around $8 per month, thus saving us at least $700 per year!
Here are a few reasons why you should cancel cable and switch to Hulu instead:
- It is cheap at $7.99 per month so you getto save around $1,000 a year if you are paying the average cost of $100/ month forcable.
- You can use Hulu anywhere you go as long as there is Internet connection.
- I love the fact that I can place my subscription on hold to save more money. If you constantly travel or just can’t use Hulu for a while (like during summer vacations or business trips), you have the option to freeze your subscription for up to 12 weeks so you don’t have to pay for the service for the duration you specified. Your subscription will be automatically reactivated after the specified duration.
- You are not locked in a contract. You can cancel your subscription any time!
Another way to lower your cost on this expense is to use Amazon Prime. If you constantly pay for shipping for your Amazon purchases anyway, why not subscribe to Amazon Prime to avail of free shipping for millions of products and watch thousands of movies and shows for FREE.
9. Buying stuff because they’re on sale
I hear this all the time: buy it because it’s on sale and you’ll never get it at the same price! It’s one of the most common spending pitfalls that most people are not aware of.
Unless you really need the item, don’t buy it just because the red sticker says it’s 50% off because in reality 50% off is not a great deal if you don’t use it 90% of your time.
10. Not using cash back apps
I love using cashback apps! It’s a painless way to save money or make FREE money. If you haven’t tried any of these apps, then you are wasting FREE cash.
My favorite cashback app is Ibotta which has so far paid me over $600 of FREE money from my regular grocery purchases and bonuses!
Ibotta is a free app that pays you cashback (a.k.a free money) for buying things you buy at the grocery store such as milk, bread, meats, vegetables or canned goods.
It works just like couponing but without the need to clip coupons. All you need to do to get your cashback is scan your grocery receipts using the app.
Ibotta partnered with hundreds of grocery stores, such as Walmart, Sam’s Club, Costco, in over 500,000 locations so there are lots of places where you can use this app to save money. You could also use it for online purchases!
You can join Ibotta here or use my Ibotta referral code fnwchum and receive $10 FREE after scanning your first receipt.
Another favorite of mine is Rakuten (formerly called Ebates.)
How it works is that you’ll earn cashback rewards each time you shop through their portal on Ebates.com. Don’t worry, Ebates partnered with over 2000 stores, including Amazon, so I am sure you can regularly use it.
If you shop strategically through Ebates, you can earn up to 40% off so make sure that you use Ebates each time you shop. I also recommend installing this free browser extension on your computer so you’ll always be directed to Ebates whenever you are shopping on any of their partner sites.
Are you wasting money on these things? What expenses do you have that you sometimes don’t realize are already harming your budget? Please let me know in a comment below!