Do you think you make the best possible use of your earnings? Do you try to cut back on foolish spending as much as you can? If yes, then you might want to think again. There may be many places where you’re still spending your money, thinking it’s necessary, but in reality, you’re just wasting it away! It’s pretty ridiculous how easy it has become to overspend money. With a myriad of things and opportunities out there, things often get pretty overwhelming. This eventually pushes us to buy things we don’t need.
It’s vital only to spend money that is necessary to spend, especially when finances are tight. Yet, most people spend on luxury items and other things that aren’t necessities but are rather a huge waste.
However, saving money isn’t as outrageous as you might believe it may be. Once you go through the list that we’ve put together, you will know how much money you waste in useless places.
So, without further ado, here is a list of dumb things that waste money.
Investing in Costly Mutual Funds
This may be surprising, but many people invest in high-cost mutual funds, which is an easy mistake to make. Unfortunately, you don’t receive a bill showing the cost of services of mutual funds every month. If mutual funds began sending bills, they would go out of business quite fast. When investing in mutual funds, the rule of thumb is to keep the total weight mutual funds cost under 50 basis points. If not better, these funds are as good as mutual funds that cost more.
Unnecessary Life Insurance
Life insurance is important for those of us with dependents. However, many people tend to make the mistake of buying more than required. The best option is to stick with term life insurance, which is the least expensive form of life insurance. This is because you need to realize that you’ll need much less (if any) life insurance once your child has grown up.
Getting Extended Warranties
A huge number of people opt for warranty extensions and service contracts. You’ll often find clerks at most stores asking if you want to add a year of warranty worth $40 onto a product that hardly costs $200. Seem quite unreasonable. Yet electronic stores and retailers make a fortune from extended warranty contracts even though they are never worth the cost.
The best idea is only to insure items that are vital, expensive, and hard to replace, including your home, health, and car. If you’re making credit card purchases, you should know that many credit card companies offer extended warranties on certain products.
Getting Paid Smartphone Apps
You can always figure out a way to do something on your phone completely free of cost. You don’t need to spend money opting for phone extras and paid apps. This is very similar to the case of ringtones. A few years ago, phones would come with a bunch of free ringtones and the option of subscribing to more ringtones for an additional fee. Well, your phone would still ring, even if you didn’t get any fancy ringtones.
Paid smartphone apps are now the ringtones of the cellphone industry. While some apps may even be for your while, depending on the reason you’re purchasing them, at other times, you can find a free app or a free version of an app to save money. The point is that you should think before purchasing any apps.
Buying Single-Use Kitchen Appliances
Supermarkets and appliance stores have a variety of kitchen appliances that only have a single-use. Sure, appliances that help you save time peeling potatoes and cutting onions are quite tempting, but it is also a waste of money. If you start purchasing single-use appliances, not would you cause a dent in your pocket, but you’d also run out of cabinet space really soon! The ideal solution is to purchase multi-purpose appliances with additional add-ons. For example, a stand mixer is a great investment if you love baking. Moreover, it offers more uses with additional add-ons, helping you save money.
Purchasing Too Many Personal Care Products
Personal care products are often considered as an investment in one’s self. So, it’s quite easy to justify spending outrageous amounts of money on them. However, let’s face it, do you really need five different types of hair products, multiple body sprays, and ten different lotions? Probably not. The idea is to keep things as simple as possible.
Sure, it’s vital to invest in personal care products, but you should do so mindfully. Start by finding a good face and hair care routine for yourself. Try sticking to a handful of good-quality affordable products. If you find yourself getting tempted to buy more products, make sure that they add some value to your routine or help you accomplish something new.
Getting Formal Wear
Dressing up and wanting a new dress for certain special occasions is completely normal. However, do you really need a formal outfit for every event you attend? Probably not. Owning expensive formal wear cannot be justified for most people. Firstly, people don’t like repeating their outfits. Secondly, selling off formal wear is quite difficult. A great choice is to rent a formal gown or tuxedo instead of buying them in such cases. This allows you to dress up in up-to-date styles at a meager cost.
Purchasing Exercise Equipment and Gym Memberships
When was the last time you went to the gym or used the exercise equipment you so determinedly bought? A huge boost of motivation can often lead you to make hasty decisions such as buying expensive exercise equipment or getting a gym membership. However, oftentimes, due to one excuse or another, you never really come around to using it. So, if you do experience a certain determination boost to drop 10 pounds or get abs, consider a low-cost option first. This means that instead of hastily buying a treadmill, try walking or jogging to see how long it lasts.
Now that you’re aware of dumb things that waste money remember to be more mindful of your expenses. The best way to do this is to keep track of your income and spending regularly!