6 Money-Draining Mistakes to Stop Making Now
You're probably aware by now that making small tweaks to your spending habits will add up to significant savings over time. Ditching the daily Starbucks habit, bringing lunch to work, and cutting back on weekly manicures could "earn" you hundreds of dollars per year and well over $100,000 over the course of a decade.
However, there are sneakier money thieves lurking in unexpected places and draining your bank account on the sly. Keep reading to find out what not to do in order to boost your savings right now.
Renting a Storage Unit
It's tough to resist the allure of self-storage, especially when you're renting a small apartment with one (count 'em, one) closet and no space for even a coffee table, much less an extra wardrobe. But if you're storing a bunch of stuff with the idea that you'll use it in the future and don't want to repurchase those things, think again. A storage unit actually won't save you money.
On the lower end of things, a five-by-five-foot unit costs an average of $40 to $50 per month, or $480 to $600 per year! As Money magazine points out, "These expenses combined are the equivalent of a car payment or monthly grocery bill for many households, which would offset any savings you might recoup by hanging onto this stuff in the first place." Instead, dive in and sift through what you need and what you can sell or trash — spending a little time now will save tons of money in the future.
Leasing a Car
I will let the excellent Suze Orman explain this one:
"A shiny new car every three years seems so enticing. But have you every stopped to consider the cost? If you are leasing and trading in, and then leasing again, you never own the car free and clear. You will be making monthly payments forever. That is a colossal waste of money. If you instead follow my advice and take out a three-year loan, you will own the car free and clear after 36 months. Given the dependability of cars these days, that could mean you could keep driving the car for five, seven or even more years (depends on your mileage) without having a loan payment. That gives you years when you can be saving more for other important goals — such as retirement-rather than continuing to throw money at your depreciating car."
Signing Up For Retailer Credit Cards
"Would you like to save 15 percent today by opening a credit card account with us?"
Like the moment in a horror movie when the lady runs back into the house where the killer lurks, listen to the voices shouting, "Don't do it!" It's tempting to give into this "offer" when you're on that shopper's high and making a big purchase, but it's probably best to decline, especially if you only occasionally shop at that store, because the high interest rates mean that any discounts will not prove worthwhile in the end.
According to a survey by CreditCards.com, "The average APR on America's largest retailer credit cards has risen to 23.84 percent and only half of the cards offer a sign-up rewards deal or purchase discount. Retailer cards remain valuable to people seeking to build or rebuild credit, but those with good credit can find better deals."
Online shopping has rapidly become the preferred way to shop, and as more retailers offer free shipping, it's hard to justify ever paying for it. Even if you can't meet the minimum amount required to qualify for free shipping, you have options. Check websites like FreeShipping.org for shipping codes, or opt to have your items shipped to a nearby store and pick them up for free.
And although online shopping is clearly the wave of the future, there is still the human-based option of ordering by phone and asking nicely to waive the shipping charges. You'd be surprised what a little common courtesy will do.
If you haven't done so yet, cut the cord! Relying solely on cable TV for entertainment not only means overpaying every month, but also missing out on amazing TV shows that are exclusively available on Netflix, Hulu, or Amazon Prime. If you can live without the 900-plus channels, cut out cable TV but keep the high-speed internet so you can stream movies and shows straight to your TV.
Having said this, it is worth taking a look at how much monthly subscriptions to streaming services like Netflix will add up to over the year. If your cable TV and internet package comes to less than $100 per month, it could be worthwhile to just stick to those 900 channels. But even with monthly fees plus the cost of internet, you'll most likely save at least a few hundred dollars per year by eliminating that cable bill.
Paying Full Price
With so many ways to find deals these days - signing up for exclusive emails, following retailers on social media, finding coupons or discount codes, and, heck, even Groupon! - it's almost physically painful to pay full price for anything. Try finding discounts, and it never hurts to comparison shop and then use the competitive information you dig up to your advantage.
Another old standby? eBay. We've found killer deals on eBay and you can read reviews, so it's more reliable than sites like Craigslist. Talk about an oldie but goodie!