Do you or your partner always splash money out on things that are later considered a waste of money? Do you know what things you should stop buying?
Firstly, I’m going to make two quick assumptions based on the fact you are reading this article and have stopped by at the site.
- You only have a limited amount of cash coming into your household every month.
- You are in some way interested in achieving financial independence.
Wasting Your Hard Earned Cash
Everybody in the world has wasted money at some point. In this consumer led world there are millions for you to spend your money on.
Depending on your point of view spending money on anything could be seen as a waste of money.
A dedicated football fan going to see his team play every week could be their reason for living. To others this could be seen as spending money watching grown men run round in a field.
Even one of the things that keeps us alive; food, could be seen as a waste of money if you are spending too much.
Working out what to spend money on and what not to spend money on was a question I had to ask. But to who??
If In Doubt Ask Money Writers
There are thousands of people in the world writing about money including your friendly neighbourhood Frugalfox.
Surely some of them could help determine what items are simply a huge waste of money.
And guess what……. they did.
Money Writers Say These 7 Things Are An Enormous Waste Of Money.
Pia from bigkidlittleadult.com “They pollute the air and are quite literally the way to burn money.”
Lets Just think about this for one second. You pay somebody a large amount of money to dry some plant material. You will then set this on fire before throwing the end which you can’t inhale into the bin or on the floor.
The smoke produced by the cigarettes makes your house, your clothes and your car smell. Not to mention what it does to your skin, your lungs and your breath.
Smoking is legitimately one of the most illogical things you can do if you are aiming for financial independence. Spending money to shorten your life, whilst at the same time making somebody else rich.
The antithesis of frugal.
2) Actively managed funds
Thefinancialjourneyman.com “Actively managed mutual funds other than a few offered by Vanguard with low expense ratios”
Actively managed funds over a short period CAN out perform the markets. The problem is however that its very unlikely, and over a long period it could be seen as almost impossible.
Why not spend a a quarter of the money (or less) on tracker funds and achieve the same or more likely better results.
3) Bottled Water
Jim from wallethacks.com “Bottled water, regularly. There are many cases where bottled water is best and necessary but when you do it all the time as a default choice, it’s a waste.”
Bottled water is a waste of money. There are so many ways around buying bottled water these days. Bottles like this with inbuilt filters can save you hundreds. This bottle filters around 150 litres of water or around the equivalent of $300 on shop bought water.
4) Lottery Tickets
CYInnovations.com “I would say that one of the biggest wastes of money is buying lottery tickets – you just won’t win.”
They actually wrote a post about this very subject “The Odds of Winning the Lottery . . .”
Personally I haven’t bought a lottery ticket for years although I’m not adverse to a bit of “gambling” through matched betting.
5) Extended Warranties
OthalaFehu “Warranties, with one hand they sell you an inferior product, with the other they ask for more money based on the fear that they just sold you an inferior product. Most products are not made to last very long anymore, let the fates decide.”
I have never taken an extended warranty on any product and I don’t intend to anytime soon.
In the UK we are protected by the Consumer Rights Act 2015. Basically this means any item purchased should be of satisfactory quality, fit to do the job intended and last a reasonable length of time.
If something breaks in our house it goes straight back to the shop.
6) “Too much house”
Jim from www.routetoretire.com “More than anything else, I think that this can have the biggest impact on someone’s savings in the long haul. We have a tendency to think that bigger is better or that we need to live in the richest neighborhood, but that hefty mortgage payment can severely cost a family big time in the long run.”
Peer pressure or trying to “keep up with the jones'” can have a massive effect on your ability to become financially independent.
Is your house like “living with the enemy”?
7) Eating out
Adventurerich “Eating out regularly. Eating out is great on occasion, but the difference between home cooked or home prepared meals and eating out is ridiculous! I buy a dozen eggs for $0.49 but if I try to order eggs at a restaurant, its typically $1.50-$2/egg ($18-$24/dozen!).”
This is a difficult one. For my job I get paid to eat out a lot, this causes tensions at home when I never want to go out for dinner with the wife.
We save our meals out for special occasions and when we are on holiday.
7 Things That Are An Enormous Waste Of Money
So there we have 7 things that money writers consider a complete waste of your hard earned money.
You can see find the second part of 7 Things That Are An Enormous Waste Of Money here.
What expenses do you consider a complete waste of money and what can’t you live without? Let me know in the comments below.