One of the quickest ways to see an increase in your bank account is by cutting back spending on nonessentials. It is outrageous the number of money people are willing to spend on little things daily, which accumulate into great sums over time. The key to improving bad spending habits is being more conscious about where the money is being spent and maintaining a frugal mentality. The 8 most financially draining habits are listed below, avoiding these as much as possible will help you build wealth at an accelerated rate.
1. Eating out
Eating out frequently is an expensive habit that can easily be avoided. Many of us want quick, easy, and good-tasting food so buying a meal from a restaurant is very tempting but it comes with a price. Meal prepping and buying sizeable amounts of discounted food items from your local grocery store and cooking at home is a great financial alternative.
2. Lottery Tickets
Purchasing lottery tickets should always be avoided. The idea of spending a little bit of money on the chance of making millions of dollars is very tempting, this is why so many people buy into it. Some people may feel that winning the lottery is the only way to riches but don’t stop to consider the odds, winning the top prize on Powerball or Mega Million are 1 in 292.2 million and 1 in 302.6 million, respectively. Investing in the stock market is a great financial alternative to wasting money on the lottery.
3. Cigarettes or Drugs
Cigarettes or other drugs are not only damaging for your health but they also cause damage to your wallet. Many people use cigarettes or other drugs as stress relievers or for enjoyment but don’t stop to think about how it is affecting them financially. The average cost for a pack of cigarettes across the United States is around $6.96, and many smokers can burn through a pack a day. Let’s do some math, ($6.96 per pack x 365 days = $2,540.4 waisted). A great financial alternative to cigarette or drug use could be exercising.
4. Expensive Car loans
Many people lock themselves into expensive long-term loans in order to have a new pristine car full of the latest technology. These monthly car payments can be detrimental to your budget and can be avoided. A great financial alternative to expensive car loans is buying an older used car with cash.
5. Bottled Water
Buying bottled water although very convenient can be expensive over time. A great financial alternative is buying a filtering system and a single reusable bottle and drink filtered tap water.
6. Expensive Coffee
Many people rely on coffee to get moving in the morning or stay motivated at work but this doesn’t mean $5 Starbucks coffee is the only option. Consuming caffeine in any way stimulates the body, this is why buying a coffeepot and making coffee at home is a great financial alternative that will hold the same results.
7. Unused Subscriptions
A subscription is a standard payment method used by many companies and the monthly expenses for users can stack up quickly. Some examples of subscriptions are apple music, Spotify Premium, Hulu Live, Netflix, Amazone Prime, a gym membership, etc. Lack of awareness of subscriptions can be very costly especially if it is not being utilized. A great financial alternative is checking your subscriptions relatively often and canceling unused accounts.
8. Credit Card Fees
The failure to properly manage credit cards can lead to tremendous fees and a poor credit score. Some examples of potential fees associated with credit cards are annual fees, late fees, balance transfer fees, finance charges, etc. To avoid these types of unnecessary payments a great financial alternative would be utilizing credit lines with less potential fees and understanding how to handle borrowed money before applying for the card.