When it comes to buying things, we all have little things we buy, sometimes on a daily basis. For the past several months I’ve been helping a friend get her finances in order. She lives on a fixed income and didn’t know where her money was going. After having her record her daily expenses for only one month I discovered where her “money leak” was. She had won a contest and given a free soda every day for a year at a national chain restaurant. So she’d go to collect her soda and usually take a friend with her. But the friend didn’t get a free soda, so she would buy one for her friend. Every. Day. And sometimes they would buy food to go with that soda. She ended up spending anywhere from $50 to 75 a month on her “free” soda. It took my friend 3 months of recording every expense before she finally listened to me and realized it she couldn’t afford it. Three months before she stopped wasting her money.
The point is, the little “this doesn’t cost very much” purchases can add up. And usually when we stop to think about it, it’s easy to pinpoint those little purchases that do you in. However, there are other kinds of money leaks that you might be overlooking. US News has a list of 10 possible money leaks you need to be on the lookout for, along with tips on how to trim them. Most of them are ones you may be overlooking.
- Transportation: Cabs or Uber rides can add up. Leave in plenty of time to walk or take public transportation.
- Name-brand products: Opting for generic can save you a lot of money. Take a look at the ingredient list between the name-brand and generic. You’ll often find they are identical, but you can save a ton of money with the generic version.
- Entertainment: Cable can cost $100 or more a month. Cut out the cable and spend more time outside. Use Netflix or Hulu. You could also get an antenna so you can get local channels.
- Grocery store “extras”: Even if you make a shopping list it can be tempting to throw in extras, especially the items surrounding you at the checkout lane. Avoid impulse shopping.
- Bank fees: Using out-of-network ATMs can really add up, especially if you do it several times a month. If you need cash, get extra at the store checkout, directly from the bank or use in-network ATMs.
- Pricey hobbies: Craft supplies and camping equipment are a few hobby-related costs that can really add up. Be careful how much you spend on your hobby. And if the hobby no longer excites you, sell your supplies. Want an inexpensive hobby? Click here for ideas.
- Wasted energy: People often waste hundreds of dollars a year on electricity and gas bills because of poor insulation. Check doorways and windows for air leaks and fix them. Also, change your thermostat by one or two degrees and it can save you more than you think.
- Your phone bill: There are often hidden costs or you may have a pricey data plan. Review your bill and consider switching to a cheaper plan or to a different cell phone provider.
- Auto insurance premiums: Most people find an auto insurance company, sign up, and then forget about it. In the meanwhile, premiums rise and you keep paying the bill, not thinking about it. You should get new quotes every year or two and often you will be rewarded with lower premiums. While you’re at it, review Homeowners and Health insurance premiums too.
- Takeout: Eating out multiple times a week when you don’t feel like cooking can really add up. Or buying a soda every day adds up too. Online food services like Seamless or GrubHub make it so easy that you don’t even realize the impact it has on your budget. Cut back on takeout.
Little things can add up. Control the money leaks.
For the full article from US News, click here.