8 spending habits to avoid

Eight Spending Habits that Can Cost You

By Mike Peterson
In October 26, 2015

You’re not a big spender.  You don’t drive a fancy car.  Your rent/mortgage payments aren’t astronomical.  In fact, you consider yourself to be fairly frugal.

You should have no problem saving money. But somehow, all that extra cash you should have seems to disappear by the end of the month.  Why? Where does it go? And how does it get there?  Is there some kind of financial Bermuda Triangle out there, just waiting to zap your extra money into oblivion?

No.  No there’s not.  That’s one thing you can rule out, I promise.

What’s more likely is that you have a few spending habits that are draining your wallet. You may not be blowing huge amounts of cash on fancy, big-ticket items – but you may be chipping away at your bank account with small, seemingly inconsequential purchases.

Read on for a list of eight common spending habits that can derail your efforts to save:

  1. Carrying credit card debt. If you’re not paying your credit card balance off every month in full, you’re paying interest.  The amount you pay depends on your total credit card balance, of course – but they add up.  Why pay anything extra?  Work on paying your credit card balance in full to avoid unnecessary fees.
  1. Spending more to “save.” Have you ever purchased something simply because it’s on sale and/or you’re getting a good deal?  Or purchased more than you need to get some kind of “buy X, get X free” deal?  Do you throw extra items into your Amazon cart just to qualify for free shipping?  These may seem like ways to “save” money, but the truth is, if you’re regularly spending money on “deals” you don’t really need or wouldn’t typically buy otherwise, you’re not saving anything.
  1. Buying fancy coffee. At first, coffee hardly seems like a huge splurge… until you start doing the math. Let’s say your favorite triple-mocha-pumpkin-spice-decaf-soy latte costs $5. No big deal, right?  Right . . . until you do the math.  If you start (or end) your daily commute with a trip through the drive-thru of your local coffee chain, you could be looking at upwards of $100 a month.  That’s a grande drain on your savings.
  1. Making “in-app” purchases for smartphone games. Smartphone games are colorful and easy to play and they can be pretty darn addictive. And that’s exactly how they can get you in trouble.  There’s nothing wrong with playing Jewel Crush or Farm Universe or Zombie Kittens vs. the Mafia – except that most of these games follow a “free to play” model, as in, you can start playing for free, but you eventually have to use real money to buy additional content, tokens, or other items to progress past the first few levels.  And most of these purchases can be made with the touch of a button – which makes it all-too-easy to spend without thinking things through.
  1. Paying your bills late. In most cases, when you pay a bill late – whether it’s a credit card bill, utility bill, car note, or even your monthly rent or mortgage payments – you’re stuck paying a late fee on top of what you already owed.  Although they vary from company to company, late fees are usually around $30 or $40, which can add up quickly – especially if you regularly pay some (or all!) of your bills after the due date.
  1. Giving in to impulse buying. Cash registers are typically surrounded with magazines, soda, candy, energy bars – you name it. And, there’s a good reason for this: As you stand in line, you’re likely to see at least one item that catches your eye – and you’re pretty likely to throw it in your basket.  Again, we’re not talking about huge purchases here – a $4 magazine here, a $2 energy bar, etc., but if you tack a few dollars on to every gas or grocery run, those little impulse buys will add up – big time.
  1. Smoking. Not only is smoking incredibly bad for your health, it’s also damaging to your budget. If you smoke a pack a day at, say, $5 or $6 a day, well, that’s a huge chunk of cash that could go into your savings, retirement, or emergency accounts.  Yes, it’s hard to quit smoking – but the benefits to your health and finances are well worth the effort.
  1. Buying lunch at work. Sure, it’s convenient to hit up the burrito place across the street on your lunch hour – but at around $7 to $10 per day, those super-convenient lunches can be super-draining on your bank account.

So, are you “guilty” of any of these not-so-great spending habits?  If so, now’s the time to make some changes!  You may find that it’s not so difficult to cut down – or completely eliminate – some of these unnecessary purchases.  And once you do, you’ll be surprised at how much farther your money goes!

mike-peterson-250If you need debt advice or budgeting advice, you can always contact the Debt Guru team today for a free, no-obligation quote.  Our friendly, certified debt counselors will be happy to help you take steps toward a financially sound future.

Mike is the author of “Reality Millionaire: Proven Tips to Retire Rich” and he has been published in a variety of local and national publications including Entrepreneur Magazine, Deseret Morning News, LDS Living Magazine, and Physicians Money Digest. He holds a B.S. in business administration from the University of Phoenix.