If life were simple, we would just buy the same bare necessities everyday cash-in-hand, or by trading llamas or something, and there would be no such thing as debt. Unfortunately, life is not that simple, and many of us have gotten into bad spending habits that waste money and accumulate debt. This is a guide on how to recognise and stop these bad habits in their tracks.
1. Out-of-network ATM fees | Saving Money Sydney
Save money by using your own bank’s ATMs
Using another bank’s ATM is a money-wasting convenience that can be avoided through foresight. The $2.50 per transaction of an out-of-network ATM can be avoided by bringing enough cash or walking to your own bank’s ATM.
This is one of those things where doing it every now and then is perfectly fine, but getting into a habit of doing it is a ritual waste of money. Plan ahead, always make sure you have enough money on hand and think about what you are doing in the future and whether you will have access to an ATM from your bank.
2. Using A Credit Card When You Have Enough Cash On Hand | Reducing Debt Melbourne
Avoid credit card transaction fees by opting for cash
Credit cards have notoriously high transaction costs. Each time you pay by credit card you may be paying around 2.5% extra for what you are buying. And if you have cash on hand, why not use it?
A common reason for people paying by credit card even when they have cash is because it doesn’t feel like they are spending as much if they don’t have to hand over hard cash.
Unless you have a good deal on your credit cards or the store you are shopping at doesn't charge a transaction fee then try and use cash in most situations.
3. Buying Bottled Water | Avoiding Debt Brisbane
Save money by avoiding unneccessary expenses
Bottled water is the least necessary $3 purchase you can buy. It is just as healthy as tap water, except tap water is actually better for your teeth (Source). And of course, tap water is free.
If you are concerned about tap water, try a Brita instead as a one of purchase it will be cheaper over time. Bottled water is one of those things you can definitely do without and can save you hundreds over the course of the year.
4. Impulse Buying | Bankruptcy Solution Canberra
Making purchases without planning or thinking can waste money on things you don’t need
Impulse buying is when you buy something at the last minute without really thinking about it. The classic example is when you buy a Mars Bar in the checkout line. Impulse buying is one of the classic ways that people waste money then regret it. And it’s difficult to avoid because so many businesses actually try to make you impulse buy. This is the reason for Mars Bars in the checkout line and ‘Would you like fries with that?’. Nevertheless, with some impulse control, it is possible to resist the urge to impulse buy. Here are some tips:
- Follow a shopping list.
- Don’t shop with your kids (too often).
- Think about significant purchases for at least a day and a night before proceeding. If possible, seek the opinion of another person.
5. Brand-Name Products | Reducing Overspending Adelaide
How much are you paying just for the brand name?
Is the word ‘Adidas’ really worth that much? Considering that shoes are known for having gratuitous markup values just for brand name and that you can buy brandless/brand imitation identical shoes for a fraction of the price online. (And let’s just halt the rumour right now that knock-off products are illegal.)
But the best opportunity for saving money is pharmaceuticals. Brand name medications have the same active ingredient as generic medications. Panadol is made from paracetamol, so if you just buy generic paracetamol is considerably cheaper.
6. Expired Gift Cards | Budgeting Gold Coast
Avoid losing money from expired gift cards
When you realise that the $50 gift card that your friend gave you for your birthday expired last week it’s pretty much the worst feeling. It’s so needless a waste of money . . . if only you wrote it down.
The #1 trick to not losing money through expired gift cards is: write the expiry date on the calendar. Also write a reminder on the calendar at least a month before it is to expire. That’s how yours truly has solved this problem completely.
7. Late Fees | Spending Less Newcastle
Penalty rates on unpaid debt and overdue bills
Late fees are often just as avoidably tragic as expired gift cards, if you have the money to pay them. In the same way, we recommend writing a reminder for paying your bills on the calendar at least a month before it is due. That is, if you don’t pay it immediately which is the safest option.
Making sure you keep on top of all your credit card, electricity, water and other bills is extremely important. You don't want to end up further in debt by not keeping up with your current bills. Also paying on time means no more interest is incurred on top of the bills.
8. Warranty And Extended Service Plans | Smart Spending Melbourne
Don’t get upsold into buying something that you don’t need
Many merchandise, appliance and electronics salesmen try to upsell you after you make a purchase by offering you an ‘extended warranty’ or some such deal. They promise you the security that if the device breaks in this time frame, that it will be replaceable with a new one.
Extended service plans are rarely worth the money though. Most appliances come with included service plans that are adequate. And it is not usually that a device breaks within the first two years of use.
9. Unused Services | Repaying Debt Sydney
Ongoing payments that aren’t being used are a large waste of money
Statistics say that 3 out of 4 gym memberships are virtually unused. Yet when you apply for a gym membership, you commit to a year of payment, irrespective of how much you use it. The solution is to carefully consider what you will and won’t use. Throughout the year each time before you sign up to one of these services.
You can also reduce the amount of memberships you have and try doing some of the activities at home. For example, instead of paying for a yoga class, try doing it by yourself to save some extra money. While it can be harder to motivate yourself, it will be worth it in the long run and help your bank account.
Also making sure you cancel a membership if your not using the service. Now days a lot of service have automatic charging and you need to cancel the service to stop it from charging straight away.
10. Incandescent Light Bulbs | Managing Finances Brisbane
CFLs are one of the most cost-effective investments you can make
Compact flourescent lamps (CFLs) cost more than incandescent (standard) light bulbs, but they are an innovation that is an absolute game-changer. They use 75% less electricity that could equate to savings of $10 per bulb per year.
Save Small Amounts Every Day | Debt Consolidation Perth
To add up to large savings by the end of the year
These savings are of the form that may save you under $10 each day. But when you add this up at the end of the year, that’s a lot of money going towards paying off your debts and achieving a healthy bank balance.