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The Often Ways People Waste Their Money and Where to Stop Spending


Today I want to talk about some money problems that most people bump into every day and then a few words about the importance of keeping track of your expenses. Let me start by defining what I mean by saying "money-saving tips". It's not about just cutting off your daily Starbucks coffee (still it could be helpful a little bit) or not buying a new pair of shoes every and clothes week (unless you really need them). There are simple things that can save you hundreds of dollars each year.

The first step is should be to get to know how much you're spending and find your reserves. Spend less than you earn. Never go into debt unless you absolutely have to. And this is a well-known fact, but it bears repeating. Most people spend way more than they should on things like food and clothing or even for subscribed services like streaming or overpriced mobile deals because we don't know what we're supposed to be paying for them. And you should start to cut your budget here.
But before that think about it for a second and then ask yourself. Do you truly know how much you spend every single month on TV streaming services (many families have several of them), gaming platforms (which you don't play anymore), smartphone bills, etc.? Do you even use them?
Do you really need to buy a new trending smartphone every year? What about insurance? When did you check your energy tariffs?
And please, please, tell me you did not max both on your credit cards. I know that tempting feeling when you saw something you want so badly. The problem is you spent all the money on that stupid overpriced branded t-shirt but your check has not arrived yet until next Tuesday when all you have to do is pull out a card from your wallet and swipe it throw that card reader to pay and fill your lust. Trust me those good feelings are just for a short period of time before you start to regret that.

I have bad news for you. You know It's a trap and starting line for a rat race.

So, stop blaming others for your own bad decisions that led you into this situation where you just are now. But don't worry too much. We all make mistakes. Yet clever people can learn from their own mistakes, move on and turn those mishaps into advantages in the future.
What about you? Can you do the same? If not, then it doesn't look good for you because you will be likely repeating those same mishaps again and again.

Let me ask you a simple question. Do you know how much you spend monthly? What are your expenses? Can you save some money every month?

If not, then you have to learn your spending habits and keep an eye on where your money goes for a month or two. Sounds boring right? Well, maybe but think about it! I know several people who always complain about money. I often hear words like "I have no money", "I can't afford to buy anything", and "My bills are killing me", but when I ask them if they know where that money is gone they can't answer this simple question, just shrug their shoulders and stay quiet.

And it's common that most people have similar behavior because they have learned that way from TV, society, etc. I believe one of the reasons why schools don’t learn about financial responsibility is that nobody needs responsible people who save, invest, and live a frugal life. The government loves when people spend their money - means paying taxes.
It reminds me of one scene from a series movie called 'Two and a half men' where the main actor nearly went bankrupt in one episode. So, he decided to visit and ask his accountant where all his money had gone. The accountant started to laugh. Then showed him a cup, made a small hole in the bottom, starts to fill it with water, and said. ' This cup represents an ordinary person, water is an income, and the hole in the bottom of his expenses.' You can see the water is slowly draining through the hole in a cup.

Then he took a pencil and made several more holes into the bottom and started to fill the cup with water again. But now because the cup was full of holes, it can't hold any water and everything was gone in a second

And it is the same in life for most people and their incomes. It doesn't matter if they make $1000 or a million because they spend it all very quickly regardless of how much they earn.
I believe you heard about those who won the lottery and made millions as actors, and athletes however they end up poor. The reason was bad money management but let’s talk about the next time.

So, please stop spending money like a maniac and make that bloody budget.

Another question. Have you ever heard about a budget rule of 50 - 30 - 20 (60 - 20 - 20, etc.)?

Probably not, but it is a quite simple budgeting method of your salary after tax where you divide money into three basic categories according to use. First, the category with the biggest number 50%(or 60%) is intended for covering your needs like bills, groceries, and other necessities. The second number is for things your want (enjoyment) and the last part is for your financial goals, savings, reserves, investments, retirement, etc. For your information, the purpose of savings is usually for an emergency like unexpected expenses, if anything happens when we need cash fast or when we lose a job so it should last at least for 3 months (6 months recommended). The funny fact is I am just using it now because after a big fight with my agency I decided to send my boss where the Sun doesn’t shine and quit on the spot.

By the way, I believe If the cost of the living is more than 60% of your salary then you have probably done something wrong and you should fix it ASAP You have two choices. The first one is to increase your income by asking for a rise, changing a job with a better salary, building a passive income, etc. The second is decreasing your living expenses, or you can do a combination of both.

It's fascinating how some small changes in simple things can make a huge difference. For example, did you know that many people eat out at least twice a week? That adds up to over $300 a month alone. Instead, of eating in a restaurant bring your own grill, buy some cheap shitty beer have fun with your friends, family, neighbors, or police chasing you running naked through the park for much less. It can be cheaper (If the police don't catch you.), healthier and you know that nobody rummaged with his dirty buckles in your food.

See? It could be just your first step to improving your life. And it is essential to identify where your money is going - where you could cut down the expenses.

So, what are the most common mistakes that cost people money?
Here is a list of a few things you probably do without thinking. They may seem harmless at first, but they can end up costing you big time in the long run.

1. As I told you before. Not having a budget.
Budget is the cornerstone of personal finance management, and it helps you understand where your money goes. Tracking your expenses is not a complicated task. Remember that a budget is essential if you want to save money. A lot of people think that budgets are restrictive and that they restrict their freedom. However, a budget is your friend. It will help you save money by showing you where you're spending too much money, and it will help you plan for future expenses so that you won't have any surprises.

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2. Paying for unused services and subscriptions.
Some (most) companies will automatically renew your subscription every year. You need to be very careful with this because it's easy to get caught out and spend unnecessary sums of money on something you don't use! If you have any questions or doubts about automatic renewal, contact them directly before signing up so that you know exactly what you're paying for.

3. And of course, don’t forget to read the fine print.
Always, you need to read the fine print before signing up for something. For example, you might have been offered a free trial period for a gym membership, but you should remember that you'll be asked to pay after the initial trial period has ended. So, the point is you should read through the terms and conditions before you sign any contract. This way, you'll know exactly how much you're going to pay, and you'll know what you're signing up for. If you don't read the fine print, then you'll end up paying more than you need to.

4. Buying stuff you don't need.
You might think that a new dress is just what you need to make a perfect impression, but how often did you wear it after the event? The same goes for those books and magazines that you didn't read from cover to cover. In many cases, the only reason you bought these things was that you wanted to impress someone, but you should stop trying to impress everyone else and start focusing on impressing yourself instead. So, when you buy/paid for something make sure you really need it. Can you live without it?

5. Never pay full price (And I did not mean to steal it).
Be creative. Research if you can find it somewhere cheaper with similar quality. Special offers are great because they allow you to save a lot of money. You should always check the newspaper and online stores for promotional codes before purchasing so that you can save money on top of special offers. Use the coupons. Coupons are a good way of saving money. They allow you to buy the products you need without having to spend too much money. You can use coupons in several ways. For instance, you can buy things that you normally don't buy, and you can use them to stock up on necessary items. It means the same for cashback apps. Check if your store where you usually shop has one. If yes, then use it.

6. Drinking alcohol, smoking tobacco, buying lottery tickets, etc.
Alcohol and tobacco are quite expensive substances on the planet. Especially recently, and if you're not careful, you might end up spending a fortune on it. There are different types of drinks, and you need to be aware of the consequences. For example, most alcoholic beverages contain sugar, and this puts you at risk of developing diabetes, or damaging your liver, etc.
Lottery tickets… It is a nice dream the possibility to win a big chunk of money but in reality, lottery tickets are a waste of money. Let’s be honest, you have practically no chance of winning. Lotteries are designed to exploit people who think that they can win one day.

7. Overusing credit cards.
Credit card debt can be extremely difficult to deal with. If you use a credit card to buy something, you won't need to worry about paying for it immediately. Instead, the company will allow you to pay later, but the interest rates can be extremely high (Sometimes it feels like a robbery.). That's why you should avoid using credit cards whenever you can. Otherwise, you might end up spending more than you earn, and that leads to financial problems. But still, a debit card can be a great tool. If you're concerned about your spending habits, you should only use your credit card for emergency expenses.

8. Not planning your meals.
Most people make a lot of decisions throughout the day, and in most cases, they are decisions that affect their daily routine. However, there are some decisions that could change the course of your entire life. For example, if you don't plan your meals ahead of time, you might end up eating at fast food restaurants or convenience stores, which ends up costing you a lot of money. And it is the same for buying packaged food. It is though more convenient, but it's more expensive, and it contains a lot of chemicals that can affect your health. It's much cheaper to cook for yourself. Learn some recipes. Cooking is fun, and you'll appreciate the results. As soon as you get home from work, you should prepare your meal, and you should also stock up on ingredients that you can use to cook healthy meals. Planning your meals is another way of saving money. If you know what you'll be eating for dinner tomorrow, you won't end up buying too many groceries
And I don’t even talk about ordering a takeaway. I know it is convenient, but it's also expensive. Takeaway meals are usually unhealthy, and they don't contain much protein. You should only order takeaway if you don't have time to cook.

9. Buying too much food.
Do you know that the average American household throws away about $1,500 worth of food each year? Although there are many things that we can't control, such as the weather, we should still try our best to avoid wasting food to save ourselves money. For example, fruits and vegetables have much longer shelf lives than meat, so you can buy them at lower prices and freeze them once they've been washed and peeled. You should always eat everything that you buy because you can't sell it. Food is perishable, so you need to use it quickly, or else you'll lose money.

10. Buying unnecessary items.
The word 'unnecessary' is subjective, so it can be hard to tell whether something is. Nevertheless, you shouldn't buy things just because you feel like you need them. You should only make purchases when you need them.
Paying full price If you want to save money, you should always wait for sales. A lot of products go on sale after Christmas, for example, and it's possible to find amazing bargains. Although it can be tempting to buy things from the first store that you see, you should always shop around. You should compare prices before buying anything, and you should always ask for discounts. So, don’t be lazy.

11. Buying newspapers or magazines.
Really? Are you still buying newspapers or magazines? Newspapers and magazines are expensive, and they contain advertisements. You should avoid buying them because you can find all the information you need online. The Internet contains thousands of articles on various topics, and you don't have to pay anything for them.

12. Overusing air conditioning or heating.
Air conditioning is an indispensable part of modern life, and you should use it whenever you need to cool down. However, you shouldn't rely on it too much. Air conditioners consume a lot of energy, and they can make your electricity bill skyrocket and empty your wallet fast.
It is the same for heating. Keep your room temperature lower. Invest in insulation or better windows. I don't I shall say more...

And that this all for today. I hope you enjoyed reading my article and even learned something new (but probably not). Anyway, have a nice day and see you soon with my next article.

And, if you wouldlike to learn some new cooking recipes you can try my website...

Have fun and don't forget one more important thing. Spend your money wisely and live frugally but don’t overdo it. Being too frugal is a bad idea because you need to live your life. You should spend money on experiences, not material goods. If you're too frugal, then you won't enjoy your life.

This content reflects the personal opinions of the author. It is accurate and true to the best of the author’s knowledge and should not be substituted for impartial fact or advice in legal, political, or personal matters.

© 2022 John Freez

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