Where Do You Throw Away Your Money?

I know what you are thinking, who in their right mind throws money away? Well the truth is most of us waste money each and every day in places we don’t even realize. While it may not seem like a lot of money at the time, we have had many reminders recently why it is important to make every cent count. There are many ways we commonly waste money and we will look at just a few of them here today. If you recognize any of these habits or behaviors you would be well advised to try to make changes to eliminate these habits.

• Up in smoke. Smokers are the last people who need to be reminded that the cost of this habit is not only expensive financially but potentially deadly. That being said, if you are a pack a day smoker (let’s say $5 per pack which is low in some areas) you are spending $1825 per year to support your habit. Imagine what you could do with that money, not to mention the health benefits of quitting.
• Betting on a big payoff. There are undoubtedly different levels of gamblers. Some people are content to buy a few scratch off tickets or enter the pool at work when the lottery reaches millions. That type of gambling generally will not make or break your budget. If however, you find yourself hitting the casino or betting on the horses in the hopes of making all your financial problems disappear you are likely only exacerbating the situation.
• Unnecessary upgrades. We live in a society where just about everything can be upgraded for just a “little” more money. If you don’t pay attention to what you are buying you may find yourself upgrading yourself out of money that could be better invested in other places. You can go big with anything from fast food meals to building a home. The point is this, think twice before you mindlessly say yes to upgrades that you may not need.
• Not taking advantage of employee retirement plans. If your employer offers a retirement plan that they are willing to match, you must find a way to take advantage of this benefit. Do not be deterred if you are unable to max out your contributions. Any effort you make to put money aside for your retirement, especially when your employer matches the contribution is a step in the right direction. To not participate is one of the biggest ways to waste “free” money.
• Impulse sale purchases. We all love a good sale, however you only really save money if you buy something that you would have otherwise purchased at full price. It is really very simple, if you find yourself buying something because it is a good deal you may in fact be saving money off of the regular price, however if you wouldn’t have purchased the item in the first place you are simply throwing your money away.

It may not seem like a big deal to have any of these habits (or a dozen more not listed), however in the long run the little bit of money you waste here and there can easily add up to thousands of dollars a year. Just as you can silently lose money, you could silently be growing money if you took those same dollars and invested them in your future.