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A guide to managing your money: The Most Common Ways You Waste Your Money

Do you often feel that you should have more money in your account at the end of the month? The chances are that you’re spending money unnecessarily every single day! It may seem harmless to pay a couple of pounds for takeaway coffee, but even a little penny here and there can quickly rack up a mountain of wasted income.

So what are the most common ways people waste money and have you fallen victim to unconscious spending?

1. Food and drink on the go

Eating out is a satisfying experience even for the amateur gastronomist, and there is nothing wrong with treating yourself to a nice meal or the occasional cappuccino, however when your habits are damaging your budget it’s time for a re-evaluation.

Spending even just £3 per day on takeaway food or drink will add up to a total of £90 a month on avoidable expenses. Why not try preparing your snacks and lunch at home or swapping the takeaway coffee for a delicious brand of coffee that you can brew yourself at home or at work?

2. Wasted uneaten food

Are you guilty of letting food go bad on a regular basis? Buying two packs of carrots because they were on offer sure seemed like a good way to save money at the time, but now you have more carrots than you can possibly cook in a week and they have gone bad already.

Instead of impulse buying, planning out your meals for the week will reduce the amount of food you waste as every item in the fridge will have a purpose and it will save you money in the long run. Make sure to check the expiry dates of each item when shopping and be extra mindful that reduced price items may be expiring in the next couple of days.

3. Underused subscriptions and memberships

Automatically renewing a membership is a very easy way to overspend. How much time do you actually spend watching Netflix or listening to Spotify? What about that yoga app you were so excited about, but now guiltily swipe away the push notifications every morning as you snooze your alarm for that extra 10 minutes of sleep? And haven’t we all made the mistake of taking our momentary inspiration way too seriously and signing up for a yearly gym membership, only to never set foot in the gym?

We all try to be more actively involved in enjoying our personal time or learning something new, but the reality is if you haven’t used these subscriptions so far you probably never will and it’s time to cut the losses.

4. Not shopping around for deals on insurance and utility contracts

How long have you been using the same mobile network provider? What about your insurance company? Are you a truly loyal customer? Then why are they increasing your monthly tariff for the same features? More importantly why are you simply accepting these new terms without any objection?

Negotiating your regular monthly bills at your contract renewal can save you hundreds of pounds each year. If your current company is not willing to give you a good deal, there are plenty of other companies who have fantastic deals for new customers and switching providers has never been easier. Don’t be afraid, all you need to do is ask!

5. Bad household habits and home improvements

In every household, there is always someone who leaves the TV on, turns on the heating so they can walk around in a T-shirt and shorts, or takes 30 minute showers. Curbing bad habits and making simple changes to your home will save you a lot of money in the long run. For example, investing in higher quality energy efficient appliances may seem counterproductive as you will spend more money when purchasing them, however the short-term expense will be worth it when you save money on your energy bill over the next few years.

6. Entertainment

It’s very important to do the things we love that make us feel good, but have you ever calculated the copious amounts of money that are flowing to your entertainment pot? Often there are easy and cheap alternatives to our recreational habits that are simply overlooked. For instance, instead of going to the cinema, you can host a movie night at home and you can even afford to buy snacks! Alternatively, most venues now have a night where tickets are at a reduced price. Opting to make use of the offer means you can still enjoy what you love and save at the same time.

Swapping bad for wise entertainment choices will not only save you money, but you will have more money to spend on the things you love and never have money for. For example, £15 a month from your usual cinema bill can be redirected to your skydiving pot.

7. Late fees that can easily be avoided

Do you often forget important deadlines? Have you woken up to a missed payment fee more than once? It’s time to leave these avoidable expenses in the past. A little planning ahead can go a long way and give you peace of mind. Setting reminders for your upcoming repayment obligations will prompt you to revisit your financial situation and make arrangements to cover all outgoings for the month ahead of time.

8. Buying lower quality items

The buy it for life approach saves you money in the long-term as items of higher quality can be reused time on end with less risk of breaking. Buying higher quality doesn’t necessarily mean buying luxury items. This approach still encourages moderation and up-front savings, however it promotes picking meaningful products that have lasting use and being thoughtful about your purchase. For example, investing in quality appliances, health products, clothing, shoes and a car will save you money and a headache.

9. Transportation

For most people transport fees are one of the biggest drains on funds. Have you evaluated all options for your regular journeys, such as your journey to work? Is there a reasonable alternative route that you can take which will reduce your travel expenses? Perhaps something as simple as getting off the train one stop before and walking a short distance or grabbing a bus can have a huge impact on your ticket cost.

In addition, working out the best payment option for you is a smart way to start saving. If you only need to travel 3 days a week, it may not make sense to buy a weekly or monthly ticket when you will pay less with pay as you go.

Other options, such as sharing petrol with a colleague who lives near you or cycling to work can lead to massive savings.

10. Housing

Making a house a home is invaluable, however have you considered all the expenses that come with your new abode? There are many factors to consider when choosing a living space and the cost of the rent or mortgage may not always be the most important factor.

Could it be all about location, location, location? Would moving a bit more central increase your rent, but completely diminish your travel bill so that you are actually spending less per month? How will moving close to a supermarket with cheaper pricing impact your monthly food costs?

Moreover, shared living arrangements can take the pressure off your budget and make your living space livelier and more enjoyable. From sharing the bills and chores, to catching up on gossip and binge watching your favourite series, moving in with a good friend or a partner will give you a peace of mind and wallet.

Whatever your spending sins, it’s time to repent and to value your hard-earned money! If you are ready to kick your bad habits goodbye, check out our Guide to Budgeting to get started with managing your money.

More Information:

Top Money Management Tips

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