Most people don’t realize the amount of money they overspend on everyday things. Often these expenses become habitual and you don’t even give any thought to them after a while. Becoming more aware of what you spend is important if you want to cut down on expenses and add to your savings or retirement fund. This is not to say you should do without your daily necessities. There are ways, however, to get the things you need without wasting money unnecessarily. Here are some helpful suggestions of things you may spend money on and could save if you retool the way you do it.
1) Name Brands
Buying the name brand is always going to be way more expensive than generic or store brands. If you take some time on your next trip to the grocery store, take a good look at the ingredients of a name brand product and compare it to the ingredients of the store brand. The ingredients are usually identical and, more often than not, the name brands actually manufacture the store brand. With big name brands you’re paying for all the advertising they do to get you to buy it in the first place. So, essentially you’re getting the same product for less cost. If you’re not sure you’d like the store brand, try buying just one thing you use from a name brand. Little by little, you could roll over some items and save a lot in the long run.
2) Pharmacy Items
The same can be said for hygiene products and prescription medications. Granted some medications don’t have a generic version but most do, so be sure to ask your doctor and or pharmacist about the medications you take and if they have a generic version available. Also, shop around for the best price on your medications even if they are generic. Websites like GoodRx.com and Simplefill.com can offer significant savings on medications (up to 80% in some cases) and show you which pharmacies near you have the best prices. Same goes for things like lotion or body wash. That’s why the store brand will often state “compare to” whatever the name brand is on their label, and usually is located right next to it on the shelf.
Credit card interest payments are another area overlooked by many. If you aren’t paying your balance in full when the credit card bill(s) arrives, then more than likely a good portion of what you’re paying is going towards the interest on the card. Even if you don’t carry a large balance, every little bit adds up. If you even pay $20 per month on interest, that’s $240 per year. In ten years’ time, that’s $2,400 you could have added to your savings. It’s a given that in today’s financial climate many people use their credit card to get through. Try creating a realistic budget that you can live with without compromising your quality of life. Then consider budgeting enough weekly cash for incidentals like food or gas and only charge what you can comfortably pay off at the end of each billing cycle. The money you’ll be saving on interest alone will put some cash back in your wallet each month.
4) ATM Bank Fees
ATM fees are another utter waste of money that take advantage. They’re actually charging you to access your own money. It can be hard to say when the need to use an ATM outside of your financial institution will arise, but if you get in the habit of carrying some emergency cash for times when you can’t find or get to a branch ATM, you can avoid those unnecessary fees. Tuck four or five twenties away from where you’d normally keep cash in your wallet and forget about it. Only use it in cases where you can’t get to your bank and replace it as soon as you can. Banks other than your own can charge up to $3.00 to use their ATM’s, so keeping an emergency cash stash with you eliminates the need and the fee.
Buying coffee out is also another expense that adds up quickly. Even setting aside the pricey lattes and cappuccinos, a regular cup of coffee will cost anywhere from $2-$3. If you have just two cups per day, that can cost around $30.00 a week. A reusable coffee cup or travel mug allows you to bring coffee from home, eliminating the need and the cost to stop on the way to work. Also, places like 7-11 only charge a dollar for a refill in a reusable cup. Places like the aforementioned 7-11 also have coffee clubs that give you a freebie every so many cups. It’s not much, but free is free!
6) Shopping Bags
It’s a given that our world is slowly steering away from single use plastic. In some states though, you can still use the grocery store plastic or paper bags at a fee. Some people may think, well it’s only 5 or 10 cents. If you shop weekly and never bring your own bags, at the end of a year that can add up to money you could have put in your pocket instead. Let’s just say you shop weekly and buy 10 bags at a cost of 10 cents each. In a year, you’ll have spent $52 on bags that you probably can’t or won’t use again. On the other hand, reusable bags can be used for an entire year in some cases. Even if you spend 25 cents on a reusable bag and you buy 10 bags, that’s only $2.50 for the year versus $52.
Yes, that sounds odd at first, but there are ways to maximize your gas mileage and save on what you spend. This is especially true if you commute or drive for a living. The first thing is to make sure your tires are properly inflated. Uneven air pressure, or pressure that’s too low, can cost you hundreds of dollars more per year. Even if it’s only a couple of hundred, that’s $2,000 in ten years that you could have put in your savings or retirement account. Another tip is to just plain go easy when you’re driving. Speeding up to a stop light, or putting the pedal to the floor at the green light, will certainly cost you more in gas. If you see a red light up ahead, simply ease off the pedal. After all, you’re going to have to stop anyway, so what’s your rush?
8) Extended Warranties
This is a common gimmick that every salesperson wants you to fall for and many people do. It’s unfortunate, but the reality is they want to bump up their sales numbers if they work on commission. Some of the extended warranties may be worth it but you need to scrutinize the cost versus replacement. If you buy a refrigerator for $1,200 for example, and the extended warranty is $150 per year for every year after the first year that would be $750 for five years. If you have more than one new appliance, that can certainly add up. Most appliances are meant to last for the amount of time of the warranty and usually break right after the warranty expires. The warranty also usually only covers certain repairs, not replacement. Instead of wasting that money, just set it aside in your bank so if something goes wrong you have the money for a new one.
So, you’ve just upgraded to the latest Smart Phone, and surely you’re excited to try all the new features. Just be careful when you find the apps you want to use and make sure you’re not signing up to pay for something you really don’t need. For example, if you subscribe to a music app that only costs $2.99 per month that seems like a bargain. But why pay for something you can easily listen to for free on other apps that don’t charge for it? That’s nearly $36 per year. Times that by the number of other apps you subscribed to in your excitement and forgot about, and the total is adding up to more than you may realize. So, now that the honeymoon is over with your new phone, take a look at what your paying for and ask yourself if you really need it, or is there a free app alternative you could use? Apps are fairly competitive, so it’s worth a try to take a look. You could end up saving hundreds of dollars in a year’s time, depending on how many you signed up for.