I’m going to venture to say that almost everyone has at least something they waste money on. Whether it’s wasting your phones data instead of connecting to WiFi. Or worst paying for an outdated cable subscription instead subscribing to my YouTube channel for FREE! Or even innocently forgetting to shut off the AC when no ones home. They’re are a ton of things people waste money on. Here’s our top 5.
- Bottled water/beverages
According to a Acorns Money Matters survey 41% of millenials spend more on coffee than retirement. Which means I’m not the only one who feels personally attacked by this one. Until a few years ago, I’d spend about $10 twice a day on beverages alone! This consisted of 2 bottles of water, an energy drink, and coconut water! In case your math is as bad as mine, that’s $20 per day just in drinks! Which comes to $600 per month or $7200 annually. That money could’ve been going to increase my asset column. But instead I was wasting my money on a bit of pleasure in the here and now.
To remedy the situation, I’ve had to make few small but effective lifestyle changes. I’ve since decided to make my own coffee each morning. This meant I had to invest a little money up front in a coffee maker, but that paid for itself in about a week with all the money I saved by not buying energy drinks (Not to mention my coffee tastes better). I also decided to completely forgo the coconut water. And to pack my own water each day. This required me to purchase two 64 oz water bottles (I drink a lot) those too paid for themselves in the first 2 days. Now you might not want to carry 128 oz of water around, what I recommend to others (students in particular) is to try out a water bottle with an internal filter. This way when you run dry you can safely refill at a water fountain for FREE!
The best part of making these changes wasn’t the $600 that I was able to save each month. But more importantly, the fact that trading energy drinks for my superior cup of Joe is much healthier. And using the BPA free water bottles isn’t just better for me, but better for the environment. It’s a win win!
- Dining Out
As many as 72% of millennials admit they waste money on dining out. This is another one that unfortunately use to apply to me. There was a time when I would eat out literally everyday. To paint a picture I’m 6’3 240 pounds (athletic build), so as you can imagine I eat a lot. I could easily spend anywhere from $20 to $30 per day on dining out! That’s $600 to $900 per month or $7200 to $10,800 per year! That’s more than some people’s mortgage payment!
So, instead of making the same mistake of wasting your money on take out as I did. You should consider meal prepping. Not only will you save money, but it’s much healthier for you. Which means you’ll feel better, look better, and have more energy to work longer and harder! Not to mention, if you make all of your food for the week in a few hours; You save a ton of time by not trying to decide on what you want to eat throughout the workweek and then hunting down said food. It simplifies your life.
Another method to consider doing along with meal prepping, is intermittent fasting. This is where you only eat within a specific period of time (usually 8 hours). Beyond the numerous documented health benefits of intermittent fasting, you will gain the most valuable asset in the world, TIME! You can eat within your allotted time frame and not have to think about food anymore. This frees your mind for more important activities, like figuring out ways of increasing your asset portfolio.
- The stupid tax
This is a tax levied against you for being dumb. No but seriously, I see this all too often. This waste of money is totally avoidable, yet so many people fall prey. One the most common forms of the stupid tax is carrying a balance on a credit card. Depending on the credit card company you could be paying close to an additional 20% on whatever you buy. So if you leave a balance of $200 now you owe $240. STUPID. Don’t make this silly mistake thinking you’re going to somehow build credit faster.
The second most common stupid tax has to be overdraft fees. If you can, disable this feature completely. But if you can’t make sure you always have enough in your account to cover whatever it is you’re buying. There’s absolutely no reason to pay an additional $25 – $30 all because you didn’t budget your money.
- Not utilizing a high interest bank account
The inflation rate of the U.S. dollar is around 2% annually. Many bank don’t even giving you 1% annually. Which means if you’re leaving money in your local bank, you’re probably wasting money! If you’re like me and have a fully funded emergency fund of at least 6 months, that can add up to a significant amount of money wasted. For absolutely no reason!
In my case I have an emergency fund of $15,000. Let’s say my local bank only gives me an Annual percentage yield (APY) of 1%. That means I just lost $150 in the first year! Again, this is totally avoidable. We live in the 21st century, we have the internet; which means we have online banks like Ally bank that gives us an APY of 2.2%! That means instead of wasting money, you’re money makes you money.
- Not paying yourself first
Simply put this means you’re not investing your money. If you follow the tips you’ve learned in this article you’ll have plenty of money to invest. In my case, just by not wasting money on beverages, dining out, the stupid tax,and putting my emergency fund in an account that gives me a 2.2% APY. I’ve freed up an additional $14,430 (conservatively) to invest with each year! That can be put into mutual funds, dividend paying stocks, real estate, or even just reinvesting into my business. The way you build wealth, is by buying assets. So go get you some!