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Do you ever wonder where your money goes? Or how some other people seem to make their money last much longer than you do? It sometimes feels as if there’s a black hole in your bank account into which money gradually disappears.
Of course, one of the most important ways to get on top of where your money is going is to make a budget that takes into account all the money you have coming in, and how you spend it. We cover this in more detail in our article How to make your money last until payday.
But did you realise that there are also a lot of things that most of us regularly waste money on? It’s so easy to do, and can make a huge dent in your bank account. And if you can identify things that you are wasting money on, you can choose whether to keep doing this or to save money instead.
In this article we take a look at ten of the things that most people waste money on. See if any of them apply to you?
One of the biggest wastes of money is credit card interest. It is all too easy to start overspending on your credit card and then be unable to repay it in full each month. But if you only make the minimum repayment, you will soon be carrying a credit card balance from month to month. And the larger that balance gets, the more likely it is that your repayment is only just covering the interest being charged, rather than the balance itself.
So if you use credit cards, keep them for important purchases or emergencies only, then pay off the balance in full as soon as you are able to do so. If you do have existing credit card balances, you could save money by transferring the balance to another card with lower interest: sometimes credit cards even offer balance transfers at 0% interest. But you would need to have a decent credit score in order to be able to do this.
By far the best option is to make every effort not to run up a credit card balance, as this will definitely enable you to save money rather than wasting it.
A recent survey found that 51% of people think they have wasted money on buying clothes that only end up being worn once. And if you take a look at your wardrobe, you are bound to see lots of items you haven’t worn in a long time.
So being wise about buying clothes can really help you to save money. If you are buying new clothes, ensure that they fit well, will go with items that you already have, and will genuinely be useful. And don’t fall into the trap of buying something just because it’s a sale bargain. If you don’t really need it, you are wasting money.
Also consider alternative ways of buying clothes. For example, you can find some hidden gems in charity shops or online auction sites. Another fun option is that if a few friends are also clearing out their wardrobes, organise a clothes swap evening between you. You could all end up with some great new outfits without parting with a penny.
If you regularly shop online, you could be wasting a lot of money on delivery charges. Some companies offer free delivery on any purchase, but others charge for delivery under a certain amount. But there are various ways to save on delivery charges. Here are three to try:
Whether you are taking a quick break from the office or are out and about doing errands, think twice about buying a takeaway coffee or supermarket meal deal. If you were to spend around £3-£5 every weekday on these items you could be frittering away £75-100 per month without realising.
Of course the occasional treat is fine, and sometimes you do need to grab on the go, but it’s much more economical to sort coffee and sandwiches out at home and take them with you if needed rather than get into the habit of buying coffee and/or lunch every day.
Around a quarter of people in the UK feel that they waste money on takeaways, particularly younger people. And when you consider that a takeaway meal probably costs around five times more than cooking the same food at home, you do have to question whether it’s really worth it.
As with coffee and lunch, an occasional takeaway either for convenience or as a treat is fine. But if you are slipping into the habit of having takeaways several nights of the week, you are wasting a lot of money. It is worth spending time each week planning a few quick easy meals and making sure you have the ingredients for them, so that you have an incentive to make something at home rather than ordering food in.
And of course, even more expensive than a takeaway is eating out. The markup on restaurant and pub food is enormous, and if you eat out a few times a month this can put a massive dent in your budget. It’s estimated that a restaurant meal could cost around 20 times more than making the food yourself! So you will save money if you eat out less often, and perhaps sometimes spend a bit more than usual for special food at home instead.
If you tend to eat out with the same group of family or friends, an alternative option could be to take turns to host Come Dine With Me style evenings, where you take time to prepare a meal that everyone will enjoy. And next time you can sit back and relax because it’s someone else’s turn. It’s a great way to have the fun of a meal together without the price tag.
Even when cooking at home, you can waste a lot of money on food. Three of the main culprits here are:
If you drink alcohol regularly, the cost can be way more than you think. For example if your household buys a couple of bottles of wine and six cans of beer per week, this is likely to set you back at least £20, which adds up to £80 per month and £960 a year – the best part of £1000.
And if you drink more than that – particularly if you also buy drinks in pubs – you can double or treble the above figures.
So if your money seems literally to be draining away, it may be worth logging how much you are spending on alcohol and sometimes sticking to tap water instead. This way you can enjoy a few drinks when you want to, but also cut down the amount of money wasted.
Another area where it is very easy to waste money is home entertainment. There are so many different TV options and streaming services that it can all become very confusing. Many households have several TV and streaming subscriptions, and chances are you don’t actually need all of them.
It’s worth making a list of all your TV and streaming services and working out which ones you actually use. You may be able to cancel one or two streaming services without actually losing anything. If you use satellite or cable TV, check your package to see if there are channels you are paying for that you don’t now want. Get in touch with your supplier to see if they can tailor a package that is more suited to your current needs: they will often do this, particularly if you say that you are thinking of leaving them.
And TV subscriptions are not the only kind of subscription where you can waste money. Almost every household spends money on memberships or subscriptions they don’t use. This is a total waste of money. But people often do it just in case they might want to use them, or because it feels like too much hassle to cancel.
Typical examples of subscriptions and memberships are:
It really is worth taking an hour or so to go through your direct debits to see if there are any subscriptions or memberships that you are paying for. If you have a membership or subscription you’ve forgotten about and realise you do still want it, that’s great, you’ve rediscovered something of interest. But if you don’t want them, cancel them immediately. You can always sign up again later if you change your mind. But don’t waste any further money on them at this point.
We hope that the above tips will help you to identify things that you are currently wasting money on, and enable you to start making changes that will help you to save money.
Do check back here soon for more lifestyle and financial tips from Loans 2 Go.
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