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20 Common Money Mistakes To Avoid

20 Common Money Mistakes To Avoid

Ever wonder where all your money goes right after payday? Spending money is way too easy. It is so easy that it makes saving it look extremely hard! It is very simple to save money though it isn’t something that happens over night, you need to work on changing a few habits. There are several steps you can take to help you along the way on the road to financial success. You don’t need to be a mathematician to sit down and take an hour to analyze your spending and income to create a budget.

You can start by stepping back and going over your bank statements, or have an app categorize them for you. Divide them up into sections such as fast food, bank fees, bills, etc. When you actually take a look at what you spend and have an actual dollar amount on things, it will open your eyes. After you have seen where you spend your money, it would be best to set a budget.

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To set a budget, you need to compare how much you are spending and how much you actually make. Set money aside to take care of yourself and your well-being first. This will include expenses like your bills (food, utilities, rent) and putting money aside in a retirement fund. From there make sure you give yourself an allowance because, well, living frugally is not fun.

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After you have set some money aside for your well being, your fun money fund, and your savings, you need to make sure that you are thinking about your debt to income ratio. Take a look at all what you owe everyone and how much time and money it will take to pay them back. A majority of these expenses are going to be credit card companies and student/bank loans. The sooner you pay it off the better it will look in your bank account and also on your credit report. Don’t pretend that credit isn’t something that affects you, it affects everyone. So don’t cancel all your credit cards once you pay them off, keep them open. An open line of unused credit looks good if you are looking to buy a house or a car in the near future. Saving for the down payment and the interest will be a lot better.

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Some of you are thinking that the Fun Money Fund (FMF) is a little ridiculous, but it is necessary! You want to make saving easier so that you will keep doing it. You have lived off an allowance before for things that aren’t a necessity (most of the time it was no more than twenty dollars here and there) and you can do it as an adult. Want your FMF to grow? Pay off more of your debt and you will have a little wiggle room. Seventy five percent of that monthly payment to unnecessary bills and services could be going to other areas that need to be paid off, and the other twenty five percent of it can go into your FMF!

You may be thinking, where can I get the extra money from to pay the rest of my bills? The answer is in cutting back spending in your daily habits. Here are some common money mistakes people make everyday. See if any of them sound familiar:

  1. You keep putting off paying off your credit card debt

  2. You don’t have a savings account for emergencies

  3. You go grocery shopping when you’re hungry

  4. You enjoy frequent shopping for retail therapy

  5. You don’t maintain an allowance for fun spending

  6. You don’t define the difference between want vs. need

  7. You never read fine print

  8. You’re always trying to keep up with trends and fashions

  9. You’d consider going into debt for a wedding

  10. You prefer to buy a meal instead of preparing it

  11. You haven’t made a plan before taking out a student loan

  12. You don’t think you need to have a budget

  13. You haven’t been paying attention to your credit score

  14. You buy items based on the price and not the quality

  15. You spend more than you make

  16. You want to get a larger house and mortgage than you need

  17. You are dependent on one source of income

  18. You’re not saving for retirement

  19. You replace things that aren’t broken

  20. You’re not paying attention to your debt to income ratio

Featured photo credit: 401(K) 2012/mmoney via flickr.com

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Margielyn Musser

Event And Volunteer Coordinator / World Traveler

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Last Updated on June 26, 2020

25 Easy Tips on How to Save Money Fast

25 Easy Tips on How to Save Money Fast

“How to save money fast?” This is the question asked by all of us not in the top 1% of rich people.

If you are looking for ways to drastically reduce your expenses immediately, first look at what you need to spend money on every week. And I mean really need.

You don’t really need to order in food. You don’t really need to buy expensive perfume.

Building from that, you can work out how your regular expenses can be reduced.

As for irregular expenses, they can also be deceptively costly in the long run. Once-off buys can also be tackled with some prudent planning and a little extra research.

And remember: a budgeted lifestyle does not mean a bad or boring one!

But first, understand what budget you can cut down on daily:

  • Regular expenses for the average adult (can be trimmed but not eliminated):
    • food
    • rent/mortgage
    • cell phone
    • insurance
    • socializing/entertainment
    • transportation
    • hygiene products
    • household bills
  • Irregular expenses for the average adult (can be eliminated or cut down a lot):
    • travel
    • clothing
    • medication (*depends)
    • grooming (hair, nails etc.)
    • gifts

Now, let’s dive right into the 25 ways to save money fast:

Save Money on Food

1. Bring a stock of food to the office/work

Instead of popping out for an overpriced salad and a smoothie, leave a set of basic utensils at the office as well as a stock of non-perishable goods such as tinned fruit, tuna, rice crackers and so on (try to avoid the junk food and this can turn into a pretty great diet!).

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Stocking up means you won’t forget or say “I didn’t have the time” when you rushed out to work in the morning.

2. Buy the store-brand version

Many basic foods, such as bread and milk, will taste exactly the same as their branded alternatives. Go for stuff with minimal additives and preservatives. Meat in a tube is probably insanely unhealthy!

3. Eat cheaper cuts of meat

Learn how to tenderize and flavour cheaper meat and fish, and save on the (typically) most expensive item on your grocery bill.

4. Have group dinners

If 10 friends put $5 each in the kitty, it’s pretty easy to make a giant lasagne and get refreshments, as well as hang out with your favourite people.

Save Money in Transport

5. Get a bicycle

Save on gas money and bus/metro fares with this underrated mode of transport.

6. Use public transport and/or don’t get taxis

Some places can only be reached by car. But as a good practise, check your public transport website and see if any routes pass nearby where you need to get to. Walk as much as you can.

7. Find the cheapest gas

Regularly check out where the cheapest gas can be bought.

Save Money in General Shopping

8. Shop online

Not only will you save on the gas or transport fares from going to the shopping mall but you will also find better deals

9. Sell your old stuff

Get your unwanted belongings up on eBay ASAP and earn a few dollars.

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Here’re more ideas for you: 25 Things to Sell to Make a Lot of Money

10. Bulk buying stores

For regular non-perishable/slow perishable purchases such as toilet paper, cat food, pasta, washing powder and so on, do an epic stocking-up trip to a co-op or equivalent (my mum used to go to a place that restaurants buy from).

Be wary of supermarket “deals”, as some have been found to be fraudulent after working out a simple calculation.

11. Become a flea market/car boot sale/street market guru

You can find original gifts and develop good negotiation skills at these places.

12. Generic brand medication

More often than not, the generic version of paracetamol and other basics work the same as the branded version.

13. Choose deodorant, not perfume

It blows my mind when someone drops $70 on a bottle of spray. Stick with a nice deodorant, and not only will you smell just fine but you’ll be sweat-free as well!

Cut Down on Household Expenses

14. Printing

Ink is one of the most expensive substances in the office and coloured ink is doubly so. B

e more efficient and choose black and white, and if your printer doesn’t have a print-both-sides options, just print odd pages first, re-insert the paper and print even pages.

Expand the margins of what you are printing as often as you can to save on paper.

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15. Minimize SMS and phone calls

A combination of a free chat service such as WhatsApp and a free call service such as Skype can reduce your bill to nothing (so long as you have a decent Wifi connection).

16. Shop around for insurance

Most people don’t spend enough time searching for the best insurance deal.

Keep a watchful eye out for deals and new competitors in the market.

17. Try re-negotiating your rent/mortgage

If you have built up a good credit history or a good rapport with your landlord, then chances are a frank chat about needing to tighten your spending could result in lowering your payments. You’ve nothing to lose from trying.

18. Don’t get a TV

Invest in a computer/laptop and an internet-only package. You can watch more (and often better) entertainment on the web, and skip the advertisements as well.

19. Pool your internet bill with a neighbour

My apartment building is basically a big old house split into three apartments. There are five of us in total. We pool the internet bill, making it crazy cheap.

Save Money in Socializing, Entertainment And Travel

20. Have house parties

Instead of paying for overpriced drinks, set up a series of in-house get-togethers with your friends. Everyone takes a turn, so it’s not always your house that needs cleaning.

For sound insulation, hang heavy drapes on the walls and windows. For music, invest in a good second-hand set of speakers which you can connect to your computer. Let Spotify or Grooveshark playlists do the rest.

21. Open festivals, meetups and events

It never fails to surprise me how much underground stuff goes on around me for free or for very cheap. Find out who runs the blogs and websites that list all the less well-known cultural activities.

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22. Volunteer

If you can’t pay for a ticket, volunteer and get to be there anyway.

23. Housesit

There are multiple housesitting websites offering you the possibility to avoid paying hotels and skip the discomfort of crummy hostels.

Save Money on Hygiene and Beauty

24. DIY beauty

French manicures, pedicures, waxing, eyebrows… pretty much all of these can be achieved at home (and done well) with some practise. There are plenty excellent blogs and YouTube tutorials to help.

25. Fewer haircuts/volunteer at a trainee hairdresser

If you can’t bear the risk of a trainee touching your locks, learn more ways to manipulate your hair as it grows and get haircuts sparingly. Women’s haircuts are outrageously priced in many cities.

Bonus: Effective Money-Saving Tips for Everything

Here’s a summary of what you can generally do to save more money:

  • Share/pool resources. Organize a neighbourhood sharing scheme, common resources for your apartment block or with your friends. Not everybody needs an individual lawnmower.
  • Buy energy-saving everything. The easiest way to lower your bills – replace those lightbulbs!
  • Buy in bulk. Be sensible about it (i.e. make sure you have space!), and drastically reduce weekly expenditure.
  • DIY. Skill up using YouTube tutorials on plumbing and many other essential services so you never have to pay for simple problems again.
  • Research a lot before making a decision. Most money-wasting is the result of poor preparation and planning. Don’t shirk this part just because you don’t like it!
  • Use your network. Your network is full of resources that can ease the pain of budgeting. Ask for help.
  • Stop and think. Do I really need it?

Unfortunately, there are some things that require plain ol’ giving up for the time being. This can include high-cost sports such as skiing, the latest versions of some technologies, the finest brands of food/drinks, premier seats at the opera and most other indulgences.

What is important to remember during lean times is that when you look back on your life, it will be the experiences that stand out, not the extra comforts.

Living on a budget can teach you a lot about how much you can really get out of your paycheck. We only live one life, so make the most of every penny you earn!

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Featured photo credit: Unsplash via unsplash.com

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