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50 Bad Habits That May Be Costing You Thousands Each Year

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50 Bad Habits That May Be Costing You Thousands Each Year
50 Bad Habits That May Be Costing You Thousands Each Year

We all have them – bad habits that are costing us hundreds, if not thousand each year.  Some of these we are very aware of and others not so much.  Just how much are these costing you?

==>  Health Related

1. Smoking

most expensive habits you can have is smoking

By far one of the most expensive habits you can have is smoking.  If you are a moderate smoker (1-2 packs per day) then you are spending on average $5,000 per year on cigarettes.  This price can be lower or much higher depending upon the State you reside in and the taxes they add to the cost of cigarettes. 

It is estimated that over their lifetime a smoker will spend over $1 million dollars on cigarettes and that doesn’t include the possible medical expenses caused by smoking which collectively exceeds $100 billion dollars in the United States alone. 

Lastly, being a smoker can have an adverse effect on your ability to obtain quality employment as more and more employers are  not hiring smokers due to the increased cost to their health insurance premiums.     

2. Eating out / Not Packing a Lunch

Guilty as charged!  We find ourselves falling into this habit as it is just so easy to do.  If you’re planning a budget or trying to get control of your spending then take a good look at your lunch time habits.  Those daily trips to the local sandwich shop can really add up. 

Assuming you work a 5 day work week and spend an average of $10 per day then you are looking at a $200 monthly habit – stretched out to a year that equals $2,600.  That’s a lot of money to spend when you could bring food some home (leftovers anyone?) and it would cost you a fraction of that.   

3. Drinking Coffee

We are a nation of coffee drinkers.  Just look at the lines that form at your local Dunkin Donuts and Starbucks for the obvious proof.  This is another habit that could be costing you a small fortune throughout the year.  If you purchase one coffee each day then you may be looking at a yearly expense of just over $1,000.  This number assumes you drink ice coffee (like us) and the average cost is $2.81 each. 

The cost goes up significantly if you buy more expensive coffee (comparatively a Starbucks Macchiato will cost you $6 each) or you buy donuts or breakfast sandwiches at the same time.  For some people the morning trip to the coffee shop can be costing them over $3,000 annually.  Alternatives:  Give up coffee.  If you can’t quit then consider brewing your own at home.    

4. Gambling

Gambling is a habit that can quickly spiral out of control

Gambling is a habit that can quickly spiral out of control and leave you in financial ruin.  Many people spend their entire adult lives chasing the dream of ‘hitting it big’ only to learn the grim reality that the odds are not stacked in their favor. 

Gambling beyond your means can quickly lead to bankruptcy, loss of your job, martial/family strain, depression and even suicide.  Even a ‘responsible’ gambler who buys a few scratch tickets here and there should take a look at what that is really costing them each year – they might be surprised.   

5. Drinking Alcohol / Going to the Bar

Recent studies indicate that the average American family spends about $600 per year on alcohol.  These figures appear very low as they only average out to about $12 per week; however, we know that there are many people out there spending hundreds each week on alcohol.  Similar to gambling the potential social, physical and even legal ‘cost’ of drinking heavily can easily exceed thousands of dollars each year.

6. Avoiding Your Doctor or Dentist

Avoiding medical or dental treatment can be a slippery slope as those aches and pains turn into something much more serious.  This is especially true of avoiding preventative dental care which most health insurance companies will pay 100%. 

Allowing small issues to snowball into larger ones may end up costing you hundreds, if not thousands, in future medical/dental expenses some of which could have been completely avoided.    

7. Drinking Soda

The soda industry is a massive market pulling in $66 billion annually.   Americans account for their largest consumer group and spend one average $500 each year on soda. 

While this figure doesn’t jump out as a significant yearly expense it doesn’t account for the added hidden costs of drinking soda which includes tooth decay and weight gain as well as other medical issues.

8. Tanning

If you are trying to trim your monthly budget then the monthly fee you may be paying for tanning is a good place to start.  Not only does tanning cost you upwards of $80 per month but it also can cost you a lot more as it is known to cause skin cancer. 

In fact, it is estimated that skin cancer from tanning beds alone costs the United States nearly $350 million each year.  Do your homework when it comes to tanning and learn the possible associated health risks.

9. Speeding / Reckless Driving

In a hurry?  Not only is the habit of speeding potential costly but it also significantly increases your chances of becoming involved in a motor vehicle accident.  Locally the fines associated with speeding range from $80-434 which makes it a very questionable risk-reward activity. 

The possible costs of speeding are minimal when you compare them to more serious motor vehicle infractions such as Driving While Intoxicated which can cost you thousands of dollars in fines and legal fees.  Not to mention time away from work and a loss of license.

10. Undervaluing Health Insurance

The area of health insurance is one that can cost (or save) you thousands each year.   If you looking for a new job do not undervalue the actual cost of a quality health care plan.  Many employers that offer affordable health care may not offer you the same hourly wage than those you do not offer health insurance (or at least affordable health insurance).  Keep this in mind and be sure to place an appropriate ‘value’ on any offered health insurance benefit. 

To keep it in perspective the average premium in 2017 for health insurance was $321 per month for an individual plan and $833 per month for a family plan.  That is a big chunk of change and can have a major effect on your overall monthly budget.    

11. Waiting Until Last Minute / Procrastination

Procrastination or avoiding what needs to get done today can have adverse effects on your budget, financial and even physical health.  Not only do you have the stress of always being in a hurry but it also leads to missed deadlines, opportunities and personal commitments.  Procrastination also leads to frivolous mistakes (financial or otherwise) and can even lead to loss of employment and/or family involvement.    

==>Finance Related

12. Not Shopping for Auto Insurance

Auto and home insurances tend to have a very wide range when it comes to rates, total costs and services provided to a customer.   Given that the total cost is based on what the customer brings to the table (driving record, age, sex, etc.) it is very important to shop around and find the best rates. 

When you get your annual renewal bill this is a good reminder to call several other carriers to see what they can offer you as a potential new customer.   Don’t underestimate the potential savings doing this simple act could have. 

We have heard stories of people saving hundreds of dollars each year by making a simple phone call.  Geico insurance even created a slogan with this very idea in mind – “15 minutes can save you 15%.

13. Not Using Flexible Spending Accounts

If your employer offers a Flexible Spending Account (FSA) then be sure to take advantage of this money saving program.  The FSA program allows you the ability to put aside money tax free for the purpose of paying future medical and other approved expenses. 

Because the money is paid back tax free you are saving about 30% by taking advantage of this program and it can generally be used for expenses such as medical deductibles, co-pays, dental work, braces, medications and even childcare.   We used this benefit when our child had braces and in the end it saved us $1,800.  That is a big chunk of money for a working family.

Each FSA program has its own process to set up and limitations.  Be sure to check with your employer to see if they offer it and how to get signed up.       

14. Unused Memberships or Subscriptions

Most of us have these and they can become monthly money-drains that provide little to nothing to you.  If you are trimming your budget then these should be the first to go.  Look at things such as Netflix, Amazon, Hulu, Weight Watchers and even that gym membership that is not getting regular use. 

The key is to look for UNUSED or UNDERUSED services that are no longer cost-effective for you to continue to pay for.  They will not be hard to find as most families have 2-3 at any given time.      

15. High Interest Credit Cards or Loans

Stop High Interest Credit Cards and Loans

If you are currently carrying a balance on your credit cards then do yourself a favor and look at your monthly statement to see what your Annual Percentage Rate (APR) is.  If you have the habit of just paying the bill without looking you may be surprised (or shocked) to see how high your APR is and just how much it may be costing you each month. 

High APR credit cards should be avoided at all cost as they are nearly impossible to pay off.  More tips on this topic are discussed below.

16. Paying Only the Minimum Due

If you are only paying the minimum due on your credit cards each month then you may never get out of debt especially if you have a high interest rate.  For example:  A $1,000 credit card balance at 29% interest will accrue $79 each month in interest alone. 

If you paid the minimum payment due each month ($100) then only $21 would come off your balance and the rest would go to interest.  At that pace it would take you 47 months or almost 4 years to pay this credit card off. 

If at all possible pay more than the minimum each month even if it is only a small amount.  Paying an extra $20 per month on the above scenario would cut the repayment time nearly in half.

17. Not Consolidating High Interest Debt

If you find yourself carrying high interest credit card debt from multiple cards then do yourself a favor and search for a solid consolidation offer.  These have become very common and can be found very easily with a little bit of research online. 

These offers allow you to consolidate various high interest debt into one monthly lower interest payment.  Most of them offer a special promotional period of 12-18 months at little to no interest and then they convert to a standard APR.  Your goal is to move everything into one of these accounts and then shoot to pay it in full BEFORE the end of the promotional period.

18. Paying Late Fees

make your monthly payments on time to avoid paying late fees

Fees, fees, fees.  Seems like everything has a fee now and late payment and overdraft fees are a popular way for banks and credit cards to make money.  In fact in 2016 the three largest US banks reported earning over $300 million from these fees alone so the truth is they are not going away any time soon. 

They can, however, be avoided by making sure you make your monthly payments timely and monitor your account balances.  If you happen to see a fee on your account then call the bank and ask them to waive it. 

You really have nothing to lose by calling and you may be surprised just how generous banks are about waiving fees but only when it has been requested by the customer.

19. Having a Home Phone

Our primary methods of communication have changed dramatically over the past 30 years and having a home phone is just no longer necessary.  If you have one just because you have ‘always had one’ then it may be time to cut the cord and have yourself the extra $20-30 per month.  While this may represent a small savings we know very well that even a small savings today will add up to big savings over time.

20. Not Investing in Your Future

Life is all about balance and you should be finding ways to save for your future even if you are living paycheck to paycheck.  You should also be looking into this sooner rather than later.  Don’t wait until you are age 50 to decide that it is time to begin contributing to a retirement fund.  If you are a job seeker then you should be asking potential employers questions about their retirement or deferred compensation plans. 

Similar to insurance having a quality retirement plan should have significant weight when comparing prospective employers.

21. Loaning Money to Family

Loaning money to friends and family can become the kiss of death to an otherwise healthy relationship.  One piece of advice is you should never loan anyone money unless you are prepared and capable of NOT being paid back. 

If you are barely getting by each month and you are going to rely on repayment then you should never loan anyone money.  This will only cause you even more stress and will inevitably strain the relationship.  If you are financially able to lend someone money then you should always get something in writing.  Basic repayment contracts can be found online and may become a necessity if things go south. 

Otherwise you should not loan anyone money.  You can choose instead to give them the money with no expectation that they will ever pay you back.      

22. Using Out-Of-Network ATM’s

don't use out-of-network ATMs

We have all been there.  You need to take out a quick $20 and are forced to use an out-of-network ATM that is going to charge you a $3 convenience fee.   What you may not have realized is that your bank likely also charged you another fee for the same transaction.

Much like late fees the banks are making millions of dollars by charging these convenience fees so they are not going to be going away any time soon. 

One possible solution is to stop at a store that allows for cash back when paying with your debit card.  This type of transaction is free from any type of fee and still gets you the cash you need without searching high and low for an in-network ATM.        

23. Relying on Credit Cards to Get By

If you are relying on credit cards to get you through each month then you are playing financial Russian roulette.  Chances are you are not paying your balances off in full each month which means you are losing lots of money to interest alone. 

If you do not take proactive measures to correct your budget you will inevitably run out of rope (or credit) and the house of cards will fall.  This can be a very stressful position to be in and you really only have two choices:  earn more money or cut your costs.

24. Not Having a Basic Monthly Budget

This is a very common problem especially for younger people who may have just moved out on their own for the first time.  They have never had the need to create or even think about a monthly budget before and this can quickly lead to overspending.  We recommend you create a basic spreadsheet of your budget as most of us are visual learners and this will help you track spending habits over time as well. 

Bottom line:  You absolutely need to know how much money you have coming in and going out in order to be financially successful.  Do not live in fiscal denial or avoid it because it is an uncomfortable topic for you (or your significant other).  Taking control of your finances needs to start somewhere and creating a basic budget will help you get a handle on just what is going on.

25. Not Prepping for an Emergency

Financial experts recommend having 9 months of expenses saved in an emergency fund ‘just in case’.  While this sounds nice in theory it may be difficult, if not impossible, for the average family to amass such a large savings account especially when you consider that statistics show that 49% of American families are living paycheck-to-paycheck. 

So we promote at least HAVING a saving account and TRYING to put money in it each month.  Set reasonable savings goals and try hard to stick to them.  Having $500-1,000 in a savings account can still come in handy if you are short one month and could prevent you from incurring some serious late fees.

26. Living Beyond Your Means Each Month

save at least 5% of your gross income

Financial experts believe that you should be saving at least 5% of your gross income or they consider you living beyond your means.  That means if you are earning $50,000 per year you should be setting aside about $210 per month. 

Not leaving yourself this financial ‘buffer’ places you in high risk of financial ruin if you were to become unemployed, unable to work or fall victim to a large unexpected expense.  So, even if you are ‘getting by’ each month you should still be trying your hardest to put some money away into savings.       

27. Using Snail-Mail for Payments

In 2018 there is really no reason why you should still be relying on snail-mail to send out your monthly payments.  Nearly every major bank and creditor now offer free online bill-pay capability which makes the process as simple as one click. 

Snail-mail has three major disadvantages:  It cost you money (checks, envelopes, postage), it takes time which may result in late fees and it is not easily tracked or managed.  If you haven’t done so already do yourself a favor and make the switch to online banking – you will thank us later.

28. Paying to Park

If you work in an area that requires you to pay for parking then you know all too well the financial impact this can have.  It is not uncommon for some people to pay $10-20 per day just to park their car and go to work. 

This equates to a potential annual cost of $2,600-5,200.  If you are trimming your budget then you may need to consider parking elsewhere and walking to work, getting dropped off each day or carpooling with a co-worker in order to mitigate this expense.   

29. Using Payday Loans

NEVER, NEVER, NEVER fall victim to a payday loan.  There is almost always another way to get through a financial crunch that does involve paying upwards to 400% in interest.  If you are using payday loans to get by then you are absolutely throwing your money away and should look for another alternative immediately.

==>Shopping Related

30. Not Using Coupons

Use coupons to save money

Over 300 billion coupons are redeemed each year and it is estimated that the average couponer saves $30 per week or $1,560 annually just by clipping coupons. 

Not a bad return on investment when you consider that they report only spending 30 minutes each week looking for coupons.  When you also factor in that the advent of mobile or digital coupons has made the process easier than ever then this is a no-brainer if you are looking for ways to save yourself some money. 

This also doesn’t take into consideration the money that you can save by taking advantage of stores that price match as well as online coupon savings codes.  The digital era of coupons is upon us and with it are even more ways to save your hard earned money each week.

31. Impulse Purchases

There is a reason why retailers pay millions of dollars to study customer shopping habits and how product placement can directly affect sales.  They want to do everything they can to entice you into making impulse purchases while shopping in their store. 

We have all done this – we stop at the store to pick up just one thing and end up leaving with ten.  Reducing (or at least being aware) of your impulse purchasing habits will make you a more efficient shopper and save you money.

32. Shopping with Your Kids

If you are trying to stay within a strict budget then the last thing you want to do is take your kids shopping with you.  Having two kids of our own we know this all too well.  Kids not only make it more difficult to make it out of the store without impulse purchases but they often times make you rush your shopping trip thus missing out on opportunities to save. 

Let’s face it, for most of us having your kids running around the grocery store is just plain stressful and certainly does not promote taking your time, looking for deals and getting everything you need.  Do yourself a big favor and when possible leave them at home.

33. Not Keeping a Shopping List

Do you really need milk, bread, butter or eggs?  Take the guess work out of your grocery shopping and make a list.  Also, take the time to look over the store’s weekly sales flyer (most of which are all now posted online) so they can be viewed BEFORE heading out to the store. 

Having a shopping list will make you more efficient, less likely to forget something you need and less likely to purchase something you already have.    

34. Paying Full Price

don't pay full just use a coupon

While it is not reasonable to think that you will never pay full price you should also not just blindly pay it all the time.  There are so many coupons now available and more and more stores are now offering price match guarantees so finding a possible discount is as easy as ever. 

Don’t forget there are also now numerous free money saving mobile apps available all you need to do is some homework on which ones will work best for you and your shopping habits.    

35. Keeping Up with Others (Joneses)

Always competing with your neighbor (or friends and family) can be a very financially draining process and can ultimately lead to your own financial distress.  While some healthy competition may not be a bad thing you need to keep things in perspective and know your limits.  Remember the green is not always greener on the other side – although it may look like it from your yard.

36. Stopping at Convenience Stores

There is no way to get around it – convenience almost always has its price.  Stopping off at the local convenience store to grab milk, bread or eggs will surely cost you more than the local grocery store. 

Not to mention they make a fortune on impulse purchases as you can’t leave without grabbing that king-sized Kit Kat and 20 ounce Pepsi.  Then there is always the temptation of scratch tickets and Dunkin Donuts as well.  Trying to trim your budget?  Cut out the trips to the convenience store.   

37. Being Brand Loyal

Brand loyalty can carry with it a hefty price tag especially if you have expensive tastes.  Coupons and sales offers are generally used by major brands to entice consumers to try their product or switch from one brand to another. 

If you are unwilling to switch then you will not have the ability to realize any of those potential savings opportunities.  Having flexible spending habits will increase your ability to save in the future.

38. Not Buying Generics

buy generic brands to save on grocery

Purchasing generic or store brand products can be a great way to trim your grocery budget each week.  This is especially true for baking supplies and medicines. 

In these examples the generic versions have the identical ingredients and in theory offer exactly the same thing as the more expensive name-brand. 

Don’t let the lack of colorful labeling fool you into thinking they are of less quality.  In the end avoiding generics just to remain brand loyal will only cost you more money with little to no real benefit.    

39. Not Using Loyalty Programs

Nearly every major retailer seems to have their own version of a loyalty or rewards program.  While it may be annoying to always be looking for your rewards card these programs can be very beneficial to you if they are utilized effectively. 

The store we generally use for groceries is always running some promotion that gives us points towards free gas or pan sets.  Not a bad perk to have and over the years we have accumulated some nice freebies in the process.  Make sure you are maximizing these savings opportunities as they become available.     

40. Using Department Store Credit Cards

Department Stores make it super tempting to use their credit cards and routinely offer discounts only to cardholders.  There is a reason for that – the interest rate on these cards is generally much higher than a traditional credit card. 

They will offer you 20-30% off your purchase knowing that many people will not pay of the balance and be subject to the high interest for several months, if not years.  Also, check the fine print carefully on some of these department store offers.  Many times they will offer low teaser interest rates that balloon after 6-12 months. 

What’s worse is the offers that pool your interest during that period and then add it to your balance at the end of the promotional period.  That’s a double whammy and it can be difficult to get out from under these cards.

41. Not Researching Large Purchases

Taking the time to research purchases (especially large ones) can be a major money saver.  Think of the last time you purchased a car.  How many dealerships did you visit?  What websites did you check? 

How many offers were you made before you settled?  Doing everything you can to become an educated consumer will do nothing but help you achieve your goal of getting not only what you want but, more importantly, the price you want.

42. Emotional Shopping

Emotional shopping speaks to shoppers that purchase things they don’t necessarily need but instead they fuel a shopping addiction and need for immediate gratification.  They feel they ‘deserve it’ and often times completely ignore the financial ruin this behavior can create. 

Many times this behavior can be stress induced and many times it can be a sign or symptom of a larger mental health disorder.    

==>Home Related

43. Getting a Pet

having a pet can increase your costs

We love our dogs but we also know all too well just how expensive getting a pet can be.  If you are just getting by each month then you may want to reconsider adopting a furry friend until your finances improve.

Not only will you have the upfront adoption fees but you also need to consider the cost to feed, groom and provide vet care for them as well.  Plus, you put yourself at risk of incurring a massive vet bill if (or when) an accident or injury happens.      

44. Throwing Away Food

Do you find yourself throwing away food on a regular basis?  This is a habit that could be costing you hundreds of dollars each year.  It is usually a product of purchasing too much food all at once or failing to ‘brown bag’ your leftovers for lunch and instead eating out (and thus feeding another bad financial habit). 

We have found that making multiple trips to the grocery store instead of one large weekly trip helps us to reduce the amount of food we throw out.  We also do not purchase perishable foods in bulk and try as hard as we can to eat leftovers rather than cooking something new or eating out.    

45. Expensive Hobbies

We are not saying you shouldn’t have a hobby but we are saying you should take a close look at just how much your hobbies are costing you each month.  Some hobbies are just so ridiculously expensive to get started with (scuba diving for example) that most of us will never have the means to even start them. 

On the other hand there are so many other hobbies that start out small and can grow quickly into a major expense.  Things like photography, antiquing, collecting something, music lessons, making your own jewelry, brewing your own beer and even running in road races can all become a larger expense than you originally anticipated. 

If you are trimming your budget then make sure you take a look at your hobbies and the ‘real’ costs they create.    

46. Not Being Energy Efficient

Many of us are throwing away money each month due to inefficiencies in our home.  Some of these are very cost prohibitive such as replacing your existing heating/cooling system with a more efficient one. 

However, others are very easy and cheap to address and include things such as proper home insulation, replacing/sealing drafty windows, replacing incandescent lightbulbs, limiting hot water use and unplugging unused electronics. 

You can also consider replacing aged appliances with newer energy star ones and even taking advantage of tax incentives to transition into solar power.   

47. Drinking Bottled Water

drinking bottle water is costy

Bottled water has become almost the norm with most families but it comes with a cost that is higher than you think.  There are some things you can do to help minimize this if you absolutely need bottled water due to poor well or public water quality.  First, consider switching to a Brita water filter system.  These work very well and in the end cost only a fraction of bottled water. 

Second, if you purchase bottled water consider purchasing a generic brand.  Water is water and you shouldn’t be paying more just for a fancy label.  Third, if your family uses a large amount of water each month then consider a home delivery service.  These are more cost effective when compared to standard bottled water and produce much less waste. 

Lastly, never buy bottled water one at a time.  Always buy it in bulk (24-36 pack).  Locally a single bottle of water will cost us between $1-2 and I can purchase a 24 pack for $3.50 – that’s about .15 each.

48. Paying for Unnecessary Services

Look around your home for services you are paying for each month and not using.  This can include big ticket services such as cable which may be costing you over $1,000 each year.

It can also include unused extended service plans and cleaning or landscaping services.  These may be nice to have but are far from a necessity when your budget needs tightening.

49. Being Disorganized

This may be costing you more than you think.  Being disorganized is known to lead to late payments and the misplacing of important documents or items that cost money to replace. 

Disorganization is also often times viewed as a poor quality by managers and may prevent you from future employment or promotional opportunities.

50. Not Learning to Say ‘No’

This can become a huge financial problem for several reasons.  It often times leads people to loan or give money to family or friends because they just can’t tell them ‘no’ even if they know it will cause them their own financial hardship. 

If you have children then you absolutely need to learn to say ‘no’ as it is a much needed financial lessons for kids to learn.  Just remember the wise words “You can’t always get what you want”.

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