Andrea Woroch is a Money-Saving Expert and shares with us ways that we are wasting money without even realizing it.
Since many people are taking on pre-pandemic expenses and traveling more/prepping for back to school and return to the office, I thought this was the perfect time to review your budget and plug these leaks so you have room to enjoy things like going out to dinner and taking weekend getaways!
Here are Woroch’s 5 unexpected ways that you’re wasting money and tips to plug those budget leaks:
According to LendingClub’s Reality Check Paycheck to Paycheck research series, 54% of Americans across a range of income and ages are living paycheck-to-paycheck, with 21% struggling to make ends meet. As the world begins reopening and you start spending more on things like travel and dining out as well as transportation and childcare, it’s more important than ever to pay attention to where your money is going and avoid wasting it.
Are you guilty of these 5 money wasters?
According to Feeding America, Americans waste more than $218 billion each year on food and the average family of four throws away $1,600 annually in spoiled veggies and fruit. Cut grocery waste and costs by meal planning and run a pantry/fridge audit — sites like Cooklist.com help you find recipes with whatever food you have at home already.
Leaving gadgets plugged in.
If you leave electronics and appliances plugged in throughout the day, your energy bill is likely soaring. That’s because these energy hogs continue drawing electricity even in the off mode, accounting for 10% of the utility bill in an average home, according to the Department of Energy.
Slash this wasteful energy use and cost by unplugging gadgets like mobile charges and small appliances when they’re not in use, and use power strips for entertainment centers and large appliances to turn power completely off.
Not comparing insurance rates.
The 2017 Driving in America Report found that more than 1 in 3 Americans haven’t compared auto insurance costs or checked the price of their policy in at least 3 years which has costed them $416.52 a year in potential savings. Since insurance companies increase policy prices overtime, the increased costs can easily go undetected, but insurance comparison sites like The Zebra make it easy to gather quotes from local and national providers quickly, saving users around $922 a year on car insurance based on the national average. Increasing your deductible is another way to lower your monthly payment.
Overlooking bank fees.
With average checking account fees hovering around $14 per month (or $168 annually), according to the Checking Account Survey from MoneyRates.com, you may be wasting more money than you’re making when using a traditional bank. Online banks have lower overhead costs that they pass on to customers in the form of lower fees and no-fee checking accounts so making the switch can keep more money in your account. It’s also a good idea to move your savings to a high yield online savings account where you can earn around .5% on average, compared to the low 0.01 to 0.06% on interest offered by traditional savings accounts.
Underestimating subscription costs.
Have you checked how much you spend on subscriptions recently? This survey from Waterstone Management Group found that 84% of Americans grossly underestimate their monthly tech spending including subscriptions for Netflix, Spotify, Amazon Prime, iCloud, Fitbit, Instacart Express, Birchbox and more (the list is endless!). Sites like Trim will help you identify all the subscriptions and memberships you’re signed up for and even cancel the ones you don’t need or use.
Considering that 31% of credit card holders have never redeemed their rewards, as reported by this Bankrate survey, there’s a good chance you you’re wasting your rewards and missing out on free money. Comb through your credit card accounts and loyalty programs to see how much you have accumulated and make a plan to redeem them. You can swap points for gift cards to use towards gifts for upcoming celebrations or apply cash back as statement credit to use toward a dream vacation. Meanwhile, retail rewards can offset shopping needs such as back-to-school supplies.
Carrying a balance.
Credit card purchases can add up quickly but carrying a balance will cost you more in the long run, making everything you bought more expensive thanks to interest. Wipe away interest fees and save yourself money by transferring your current balance to a 0% balance transfer credit card. Compare balance transfer cards at sites like CardRates.com to find the best one for your needs.