Advertising
Advertising

6 Habits Which Are Costing You Money

6 Habits Which Are Costing You Money

If you are living in Manchester, and on your way back from office, eats a pizza at Wilmslow Road, you are surely spending a good amount of money on something which you should clearly avoid- for your health reasons.

Few of us do such things repeatedly- unconsciously spending money on small things. Money which could have been saved is spent on buying an extra cig or for that matter Latte coffee.

Is it wrong? Well! It depends

It depends on how you value things- for you, latte may be important because it gives you a caffeine boost you need just before you start your day

Or for someone like me who drinks 5 to 6 glasses of water immediately on waking up- just to get the same boost without caffeine. (if you drink coffee just to get a boost, try drinking a full bottle of water first thing in the morning and you will be more alert! Just try it) it may not matter much…

If you want to save money by avoiding some small expenses, here is the small list of mini habits which are costing you at least you hundreds of dollars a month:

Advertising

1. Buying pizza on your way home

I know, you guessed it right! I was going to discuss this first because most of us feel too tired after day’s work. Single, young professionals, looking to make their mark and get quick promotions, work too hard often.

By 5 pm when you leave the office for home, all the motivation and willpower is almost at zero level and you don’t feel like cooking.

If you live in a large city, peak evening hours means a lot of rush in the metro and more stress to deal with.

More stress- less willpower and you know what, on your way back, you just pull out your wallet and buy a pizza.

A pizza costs you on average $5 to $10 and if you buy at most 2 pizzas per week, you are already spending 40 per week on something you can easily cook at home or buy a really nice dinner at fraction of the cost.

2. Putting your money in banks which don’t offer interest on current accounts

I’m nott going to inform you about a secret current account offering you 5% rate but what I’m going to tell you is that you can squeeze out some extra cash if you place your money in accounts which offer you some interest.

Advertising

You may be thinking, how this one is a habit? Right?

Because you are too loyal to your Bank- you have a long history with them or probably it was the first Bank which agreed to open your bank account (My first Bank gave me an appointment to meet the Bank guy for opening my account after 6 weeks from the date I requested to open my account).

So yes over the period of time, using your Bank may be your habit because you simply don’t want other Banks.

But if it is costing you money, it’s time to rethink.

3. Buying for current Christmas season only

Buying on Boxing Day sale is a habit- a cultural phenomenon as people spend millions every year on that sale.

We buy Gifts, cakes, wine, cards, gift wrappings, and decorations just before the Christmas. However, most of the things are bought for that particular event i.e. bought in quantities which are consumed on that Christmas.

Advertising

If you can just stock up gifts (non-perishable items) for next year, you can save at least amount equal to the inflation.

If you are not a fashion crazy person, you can easily save a lot by buying next year’s items such as shoes, bags, and clothing on this Boxing Day Sales.

4. Supporting your teenage children

This one could be really emotional. If you have teenage children and you are still supporting them with pocket money and is paying for their other stuff, you should rethink because you are losing the opportunity to save.

5. Not preparing and following a budget

No one can deny the importance of having expense budget and following it. I guarantee you that if you just start tracking every single penny you spend; you are surely going to save a lot. Start developing this habit and build it as a life-long habit.

For me tracking expense is a habit because it requires repetition and if you keep on repeating this task, it will become a second nature to you record and track your expenses. Gradually you will realize where your money is going and what you can do it save it.

6. Stop paying with credit cards

In next few years, most of the developed countries will be check-free with banks only issuing money against plastic or online.

Advertising

But believe me, the joy of paying in cash is more than paying through the card.

When you pay through cash, subconsciously you are exercising control over yourself. Except your direct debits, the habit of paying cash can help you reduce your expenses. Many people spend more and get their balances transferred to balance transfer credit cards which can reduce your cost for some time but ultimately you have to pay.

Above are some simple facts which can cost you a lot of money in long run. Just be more observant of what you are spending on and you can easily save a lot. Spending without a purpose is always going to hurt your wallet so be careful.

Featured photo credit: Stylist via stylist.co.uk

More by this author

Adnan Manzoor

Data Analyst & Life Coach

50 Free Online Resources for Self-Motivated Learners How to Relieve A Toothache When A Dentist Isn’t Nearby? Say Goodbye to Sleepless Nights! 10 Essential Oils That Help You Sleep Soundly. Are You Obsessed with Your Sneakers? They Can Be The Cause of Smelly Feet 5 Simple Tips to Reduce Stress and Stop Anxiety Quickly

Trending in Money

1 How to Use Credit Cards While Staying Out of Debt 2 How to Use Debt Snowball to Get out from a Financial Avalanche 3 How Personal Finance Software Helps You Get More Out of Your Money 4 The Best Ways to Save Money Even Impulsive Spenders Can Get Behind 5 How to Answer the Tough Question: What are Your Salary Requirements?

Read Next

Advertising
Advertising
Advertising

Last Updated on March 4, 2019

How to Use Credit Cards While Staying Out of Debt

How to Use Credit Cards While Staying Out of Debt

Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

Advertising

Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

Do Not Treat Credit Cards as Your Funding Sources

Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

Advertising

I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

Make Sure to Always Pay Off Balances in Full Each Month

The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

Advertising

Using Credit Cards with Rewards

Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

Advertising

So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

Featured photo credit: Artem Bali via unsplash.com

Read Next