Spending money is something that we learn to do at a very young age. As we get older, it seems that we either gain financial perspective or lose it, depending on the people and circumstances we are surrounded with.
Bad spending habits are usually just that…habits. This means that we can make adjustments and overcome them just like any other problems in life. If you are spending too much money, work on identifying the sources of your spending. There are some likely culprits.
Here are seven really common ways we spend too much money:
Not Meal Planning: Not planning your meals is one of the quickest ways to waste money. Without a plan, you will just head to the grocery store and pick out anything that looks good (and possibly end up throwing out a bunch of unused produce that went bad). Getting started with meal planning is so easy – so DO IT!
Being a Label Snob – Needing the name brand is a problem in our world today but it is not always frivolous. Some labels are truly worth the money (my KitchenAid is worth every dollar that my mother spent on it as a wedding gift 21 years ago) while others are kind of ridiculous. Why spend extra cash simply because something is a certain name brand? If the generic is just as good, you should be saving that cash. Designer diapers, for example, are rather insane. They are holding poop for goodness sake. Poop!
Eating Out – If you eat out a ton, you are wasting an equal amount of cash. Why? Learn to cook instead (start with my recipe index for tons of meal ideas). If you are simply refusing to cook, you could just about hire a personal chef to come in for less money than it costs to eat out all day every day. A family of four can drop $100 in a heartbeat at a decent restaurant. Rethink your dining habits to save cash.
Buying New Instead of Used Cars – This one is a no-brainer. The moment your car hits the sidewalk, you lose money when you buy new. Find a great deal on a used car and you will come out far better. Period.
Credit Cards – The interest that one pays on credit cards is generally astounding. If you are in that cycle, you are very likely throwing money down the tubes. Focus your budget instead on paying this down (or off) and invest in yourself for a change.
Having Too Much Insurance – This is one of those things that won’t apply to everyone, but it certainly will apply to some. If you buy copious amounts of insurance, you are likely overspending. Paying extremely high insurance rates to cover yourself for disasters that may or may not happen is a bottomless pit. Look over your policies and make sure you are reasonably covered, but still for ways to save on insurance. Nobody can avoid every single bad thing in the world through insurance without spending way too much money. The key is to be reasonable.
Starbucks – If you go to this place more than three times per week, you are probably spending too much money…I don't care how much money you make or if you are just getting the coffee of the day. Before you have a heart attack (another reason to cut down on the coffee), remember this about cutting your coffee costs. There is nothing wrong with an occasional Starbucks, but it should be a treat and not a morning, afternoon and evening ritual.
Trying to Wing It On The Budget – If you don’t have a literal budget to go by each month, you are doing it wrong. In fact, you would be shocked at how much smoother your life could be from having a budget. Sit down and make out a budget right away and you will be shocked at how much better life can be financially and otherwise.