Stop Wasting Money: 11 Bad Financial Habits To Stop In 2019 (To Help You Save More Money)
Are you looking to take control of your personal finances? One of the best places to start is to stop wasting money by eliminating bad financial habits and overspending. A small shift in the right direction could be the difference between feeling the stresses and pressures of money or starting to make momentum in your financial journey.
Every dollar you stop wasting can go towards your more meaningful financial goals. Whether that be investing for retirement, scaling your business, taking your family on a vacation or spending more on what matters most.
Personally, I’m continually working to stop wasting money and better manage where I’m spending my hard-earned dollars. It’s hard though for me and the majority of people.
Almost 30% of households have less than $1,000 saved and you can quickly compare how your spending compares to the average American.
As the saying goes, personal finances are personal. So wasting money to one person might be the opposite to another. Taking control of your finances is about finding a system that works for you so that you can continue to make progress with your money and life. This isn’t about money shaming or judgement. Hopefully discussions like this and the others across the financial community encourage all of us to evaluate our money mindset and spending habits.
Here are 11 bad financial habits we can all counteract or adjust to stop wasting money and start saving more money.
1. Make Personal Finances A Priority To Stop Wasting Money
The biggest initial step you can take to stop wasting money is to make your personal finances a priority. Rather than have money be a taboo subject, you need to put finances at the forefront of your focus. Don’t let the bad financial habit of ignoring money management hold you down.
Perhaps the best route to take is to build up that foundation of knowledge around personal finances.
So where can you start or continue to grow that knowledge?
Thankfully, there are podcasts, blogs, books and communities to help you master your money no matter where you currently stand on your financial journey. Thousands of pieces of content are produced each week.
Here are 40+ of the best personal finance podcasts covering all aspects of money, investing, side hustles and more. If you’re more of a reader, review this list of personal finance books will ensure personal finances become a priority for you and your family. For me personally, there is a collection of personal finances resources and content that saved my own financial life. Finally, if blogs and online communities are the best fit for you to master your money check out the Rockstar Finance Feeds and Camp FIRE Finance.
Whether you’re at the start of your financial journey and approaching retirement, if you want to stop wasting money, make personal finances a priority.
2. Stop Not Planning & Tracking Your Money
“What gets measured, gets managed” – Peter Drucker.
That saying holds true as it relates to your personal finances and the goal to stop wasting money. If you don’t know where you want to spend your money and where it’s currently being spent, it’s going to be hard to improve.
It took me that same realization before I was able to get my money management on track.
Personal finances are of course, personal. So call it a budget or call it a spending plan, the idea is to outline where your money is going. You need to find a system that fits for you.
This article from The Balance discusses how to build a budget that works for you. A rough rule of thumb is also the 50/30/20 budgeting system. If you’re wasting money due to overspending on credit and debit cards, try the cash envelope budgeting system.
Ideally the road to stop wasting money is supported by getting a better understanding of the journey your money takes. From income to expenses through to budgeting for your wants and needs. Then monitoring, reviewing and adapting along the way as best possible to fit your lifestyle.
Thankfully, the growth in FinTech services available through your computer or phone have made planning and tracking easier than ever. The other option is to do things the classic way with Excel, Google Sheets or a pen and papers. It’s all about finding what works most effectively for you.
Mint
Free, easy to use and accessible by web and mobile app, Mint is a great tool to help you stop wasting money. After setting it up, Mint will automatically connect to your bank accounts, credit cards and investments to ensure you get insights into each area of your money.
Mint helps with budgeting, tracking, bill payments, overspending monitoring, credit score tracking, goal setting and more.
You Need A Budget
While not free like Mint, You Need A Budget (YNAB) is another popular budgeting and tracking software for those looking to master their personal finances. With features that maximize reporting and goal setting you can ensure that every dollar you’re spending is being tracked.
Monthly Status Check
As you continue to track your spending and manage your budget, monitoring and adjusting will be key. A monthly personal finance monthly status check can help you stay on top of your spending habits and overall money management.
3. Audit Your Subscriptions & Services To Stop Wasting Money
Set it and forget it can be a far too uncommon approach with the different paid subscriptions and services we use. We’re all guilty of overpaying or continuing to pay for products or services that are no longer being used as originally planned or delivering the expected value. It’s a bad financial habit we need to stop.
Whether it’s cable, premium streaming services, music subscriptions, magazines, newspapers, website memberships or one of any other dozen things, when’s the last did you did an audit? Go through your credit card statements and bank accounts to deep dive into your current expenses.
How much are you spending each month? Are any of these services or subscriptions essentially just wasting money? Is there one product (or more) you can cut out?
Of course life is about enjoyment and development. If there are certain forms of entertainment, services that improve your health, drive knowledge or bring you happiness, you don’t have to stop it. This is about eliminating the spending that has you wasting money.
If cancelling or downgrading to a lower tier with any of those services can help you stop wasting money, that’s a step in the right direction.
You won’t be alone if cancelling cable becomes a feasible option for you. According to Marketwatch, over 5 million more Americans will cut the cord in 2018.
Trim Financial App
Trim Financial Manager is an app that helps you save money on your subscriptions, bills and recurring expenses. It’s like an automated savings assistant that identifies cost-saving opportunities to support you on the road to stop wasting money.
Some examples of the free services it provides to help you save are:
- Subscription Analyzer
- Bill Negotiation
- Deal Finder
- Price Protection
Trim is a free tool and their users saved over $1 million in the last month. It looks to identify inconsistencies or areas of overspending based on your habits and the current trends in the market on those products or services.
Sign up today for Trim for free to review your own spending habits and subscriptions.
4. Credit Card Debt Is A Financial Anchor
There is no shame in having credit card debt. At times when money is tight or life has you down it’s an unfortunate outcome. Medical emergencies, taking care of our families, covering essential bills and staying afloat in tough times of course take precedent.
However, the interest paid on those outstanding balance is a financial anchor holding you back. Those minimal payments and the weighted portion going to interest are crippling.
It’s a bad financial habit that you (and many others) need to break. A 2018 study by CreditCards.com, found that approx. 34% of American households carry a monthly balance on their credit cards.
If things are truly irreparable, this article from Nerdwallet on debt relief can help you understand potential avenues available. Before that consider options like the below routes to expediting your debt payoff.
Balance Transfer To Lower Interest Credit Card
At times credit cards will offer 0% balance transfer when you sign up for a new card. If that card has a lower interest rate or extended window at a lower rate, this is an opportunity to potentially save you hundreds in interest. However, you need to be cautious and ensure you’re paying this debt off in the lower interest rate introductory window.
You’re then transferring your credit card debt from the higher interest card to this new one. Americans can see the best balance transfer cards at ValuePenguin and Canadians via Ratehub.
Take A Personal Loan At A Lower Interest Rate
Taking a personal loan at a lower interest rate could be an opportunity to help mitigate the situation. Whether through your bank or another financial provider, this lower interest rate could save you hundreds.
You’d apply, get approved and then use the funds to payoff the credit card. Then of course would start the process of paying off the personal loan.
Call The Credit Card Company
A simple phone call to your credit card company asking for a lower interest rate might take minutes and save you hundreds. The worst case is they say no and you’re in the same position as right before you called.
Side Hustling To Earn More Money
Have you considered starting a side hustle to earn extra income to put towards the debt? There are dozens of ways you can make money from your home or earn extra cash through your phone. There opportunities are consistent with the avenues available to make $1,000 fast or make $500 fast.
Run the numbers through Bankrate’s Credit Card Payoff Calculator to see how extra sums of money each month can help you stop wasting money on interest and expedite your payoff timeline.
5. Stop Wasting Money On Bank Fees
Long gone are the days of needing to pay fees for the standard day-to-day banking needs. No fee chequing and savings accounts have become readily available and shifted the industry standard.
Forking over unnecessary dollars for ATM fees, maintenance fees or other charges are a bad financial habit that only benefits the big banks. A 2017 survey from BankFeeFinder.com found that the average US householder pays $329 in annual banking fees.
Paying for something that you can get for free is truly an area to stop wasting money. It’s an ongoing expenses slowing down your ability to actually save more money. Thankfully, there are plenty of solutions available to you that might offer all or some combination of no costs or stipulations on key banking areas:
- Checking accounts
- Minimum balance requirements
- Foreign transaction fees
- Overdraft fees
- ATM fees
- Card replacement fees
For Americans, here are Nerdwallet’s checking account and saving account recommendations. For Canadians, I recommend the EQ Bank Savings Plus Account and the Tangerine No Fee Daily Chequing Account.
6. Earn Cash Back On Normal Shopping Habits To Stop Not Making Free Money
Another bad financial habit to break is to stop not earning any free cash back on your normal shopping habits. You could say you’re wasting money by not earning free money.
The current platforms and the offers available can provide you free money or rewards on almost any purchase you make. With no investment and only minimal effort needed you can monetize things you’re already doing to start saving more money.
It might not seem like much of a financial win but if you’re able to earn $20 per month in cash back, that will be worth over $20,000 in 30 years if saved and invested.
Here are two free platforms used by millions to save (and make) a little extra cash each month.
Ebates – Cash Back For Online Shopping
Earn FREE cash back with Ebates for the normal spending you would traditionally do online. All you do is register an account and click through the links on the Ebates website (or install the Browser Extension). Ebates earns a referral fee for driving you to these different stores sites and at no extra charge to you, you get a percentage of that cash back for free.
Ebates has affiliations with almost every major retailer (2,500+ stores and counting) including Amazon, eBay, Indigo, GroupOn, Expedia, etc. So the cash back opportunities on your normal shopping habits are endless.
Plus Ebates offers a welcome registration bonus of $10 FREE for Americans or $5 FREE for Canadians.
Checkout 51 – Cash Back For Grocery Shopping
Checkout 51 is another app to help you earn cash back rewards for grocery and household item purchases. They include a wide-range of product offerings all with a set cash back value and also release ongoing weekly promotions and one-off deals to help you push your earnings further.
Open the Checkout 51 the app before you go to the store(s) to make note of any offers, purchase your items, upload a photo of the receipt into the app once you’re back home and let your cash back dollars build up.
It takes less than a minute to upload your receipt and get that cash deposited into your account. Plus you can get $5 FREE as a welcome bonus after you upload your first 3 receipts.
Cash Back Credit Cards
Personally, I prefer travel rewards credit cards to earn points that can then help me travel hack this amazing world at a discount. However, the other avenue to go with your credit card is to use a cash back card.
Similar to the services above, you’re earning a specific % of free cash back on your qualified purchases just by using your card as your normally would. We’re talking about hundreds in free cash every single year depending how much you spend on credit cards annually.
Here are some of the best American cash back credit cards and also the best Canadian cash back credit cards.
7. Stop Overspending & Wasting Money On Utilities
One area I’m always looking to improve upon is to stop wasting money on utilities. There are good months and still some that can become more efficient. This is a bad financial habit to stop that also has positive repercussions for the environment. It’s also an expense you’ll have to deal with for your entire life so learning how to save more money now will pay long-term dividends.
This article with from an HVAC technician found that the cost of running an air conditioner can go well over two dollars per hour. Flick off the heat or cool air when you’re at work, out of the house or away on vacation. It could stop you wasting hundreds of dollars annually.
In addition to better spending money on heating/cooling, turn off the lights to stop wasting money on electricity. The cost to light your home generally represents 20% of your electric bill according to Mr. Electric.
Some of the opportunities below might fit based on your current home and living situation. The initial investment could deliver long-term savings.
- Switch to energy efficient LED bulbs
- Invest for the long-term in higher quality, energy star certified appliances
- Install a reduced water usage shower head
- Get a smart thermostat
- Change the filters on your vents and ducts to ensure optimal airflow
- Use your dishwasher as opposed to hand-washing
- If it isn’t dirty or needing a wash, don’t throw those clothes into the laundry
- Ensure your windows and doors are properly sealed
- Install insulation in your attic to better hold heat inside
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8. The Buy It For Life Approach To Stop Wasting Money Re-Buying Things
Another way to stop wasting money might seem counter-intuitive as we often preach frugality and upfront cost-savings. The buy it for life approach (aka purchasing higher quality items) is a financial habit to consider for specific types of products.
The buy it for life approach ideally saves you money in the long-term by not having to re-purchase things due to damage, breaking or malfunctions.
In my world, the buy it for life approach doesn’t mean only buying luxury or the highest tier of product. That’s not feasible for 99.9% of the world (including me). Personal finances are personal and we’re all constrained by our income, expenses and financial needs vs. wants.
It might be better dubbed the “selectively spending up approach”.
Jim from Wallet Hacks has implemented this as an “upgrade and save approach” for things he uses mostly frequently or as a strategy to make common tasks easier.
Picking specific categories or meaningful products to you could be where you focus. Perhaps items you use most frequently, need for your career or have special relevance to you. It’s also applicable to products or services that might impact your happiness, health and general wellbeing.
In my life I spent more on items like the below to ideally save more in the long-term and drive other benefits:
- Appliances
- Suits
- Fitness & Work Shoes
- Bed Mattress
- Coffee Maker
- Cookware
- Knives
9. Stop Wasting Money By Not Negotiating
Negotiating isn’t something that comes natural to everyone. It can be intimidating to put yourself out there in an attempt to get what you want or change someone else’s mind. However, when it comes to your personal finances, being able to negotiate could save (or make) you countless sums of money over a lifetime.
Stop wasting money by not negotiating in your life. I need to remind myself that constantly in my my career, day-to-day spending habits and long-term financial outlook.
So what could you try to negotiate?
- Rent
- Car Insurance
- Cell Phone Bill
- Cable Bill
- Salary
- Employee Benefits
- Used Furniture
- Vehicles
- Credit Card Fees
- Medical Bills
Essentially, you can (try to) negotiate one-off and recurring expenses that will be present throughout your entire life. In terms of a bad financial habit, not negotiating is one that you can likely improve upon pretty easily with the right mindset and research. Plus the biggest step you can take is to just ask and attempt it.
Well how can you improve or best prepare to break this bad financial habit and turn it into a strength?
This negotiation guide from Ramit Sethi of I Will Teach You To Be Rich features tips, suggested scripts, best practices and more. This article from MSN Money Talks on how to successfully negotiate lower prices can help prepare you for the eventual discussion too.
10. Plan Your Meals To Stop Wasting Money On Food
The big three expenses we all have to deal with are housing, transportation and food. Generally, the food portion of those big three has the most opportunity to make quick improvements and better manage how much we’re spending.
From shopping at the grocery store to eating out at restaurants there are some bad financial habits we can all look to better master to stop wasting money. It’s easy to just say “don’t eat out”. However, like you, I enjoy going out for a nice meal when I can fit it in the budget.
So let’s put our attention to grocery shopping and meal planning, which has helped me save hundreds each year.
Meal Plan To Stop Wasting & Start Saving Money
Here’s a crazy stat on food expenses, Americans waste of $165 billion annually just on food they throw out.
Meal planning can not only help you do your part to stop wasting money, it can also give you back the other vital resource of time.
The goal is to map out your meals for the week, generate a shopping list and then stick to that list at the store. Then once home, you bulk cook a number of those meals so they’re prepped and ready for the week. You’ve now alleviated the decision making of what to eat, whether you have the right supplies and the time each morning or evening to prep a lunch for work and meal for dinner.
So to summarize, how can meal planning help you stop wasting money on food?
- Helps you avoid expensive takeout after a busy day at work knowing you have a ready-made meal at home
- Reduces time during the week you’re having the prep and worry about food – focus your time on your side hustles, family or something more beneficial instead
- Helps plan meals around what you already have at home or that’s on sale
- Develops your cooking skills
- Keeps you actively engaged with what food you have available and reduces waste
Other Tips To Stop Wasting Money On Food
- Don’t shop when hungry to avoid wasted money on impulse buys
- Keep an eye on expiry dates to ensure you don’t waste food
- Make an effort to use everything in the pantry, fridge and freezer every month or two
- Buy generic house brand name products on certain food products to save money
- Learn your local restaurants and cafes specials, happy hours and offers
- Find BYOB/BYOW (bring your own beer or wine) restaurants to cut down on the liquor tabs
- Buy discounted gift cards online (Gift Card Granny, Raise or Swagbucks)
- Check Groupon for special offers
11. Stop Wasting Money On Things That Don’t Make You Happy Or Drive Value In Your Life
Life is short, busy and stressful. No matter what direction you go money will play an important role throughout that journey. The mighty dollar also has the ability to unlock experiences, fulfillment and happiness for you and others in your life.
Stop wasting money on purchases that don’t deliver what matters most to you.
You need to find your “why” and the experiences (or things) to generate the best ROI in your life. Then double-down and focus on those.
Perhaps it’s going on a great vacation each year. Maybe it’s watching all the big new movies in the theatre or it could be buying fancy shoes, electronics and sporting goods. If you’re a foodie, those nights out at a new restaurant might be the experiences that you value most. Sharing your money with your loved ones might be the big driver for you.
Mastering your personal finances and cutting out bad financial habits is the ultimate lever to allowing you to do what you truly enjoy.
No matter what it is that means the most to you in life, have that be the focus of your spending.
Conclusion: Stop Wasting Money & Start Saving More Money
There is no magical solution or answer on how to stop wasting money. Each of us are unique and personal finances reflect that. However, the ability to cut down on overspending or mitigate those small ongoing expenses that aren’t delivering value can truly shift your financial journey.
Every dollar you stop wasting can be reverted to now accomplish what matters most to you financially.
What ways have you caught yourself wasting money?
How do you stop wasting money and better spending or saving money in your life?
Let me know in the comments below.
Here are some other posts to help you stop wasting money, make more money and better manage money:
- 40+ Money Saving Hacks: How To Save Money Each Month In Your Everyday Life
- Creative Ways To Save Money Today: 27 Experts Share Tips On Ways To Save More Money
- Building Good Money Habits – Make Your Own Money Momentum
- 17+ of the Best Free Apps to Make Money, Save Money, Invest & Get Cash Back
- 7 Effective Money Habits And Mindsets To Help Your Personal Finance Journey
Join 70,000+ Monthly Readers
Want to start making momentum with your money and life?
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The kit includes a collection of resources to help you start to take control of your personal finances.
Great article! There are so many good points, I wouldn’t know where to start. One thought to consider is to start an emergency savings fund. If you have 3 to 6 months of money in cash or other easily accessible, low risk instrument (such as a money market fund or high yield checking account), you can avoid incurring credit card interest in an emergency.
Thanks for checking out the article and for the kind words Susie! 100% agreed. Wrote about the topic of emergency funds here https://makingmomentum.net/emergency-fund/.
Definitely an essential part of protecting yourself and your family.
Thanks again!
Scott
Great article and very informational. You have all great points to choose from and I would definitely use this information to help with saving money.
Thanks Tracy! Appreciate the kind words.
Nice points. I found an old trial subscription for guitar lessons that would have charged me $120 in April. Got that cancelled! That would have been a budget killer for me.
Nice find! Sometimes that subscriptions become out of sight and out of mind…before you know it you’ve been paying for something you didn’t really need or isn’t delivering value. Appreciate you checking out the post Jeff!
Great article! The tip to negotiate is a great one! There are so many things we can negotiate if we want to.
I would add stop buying things you will use once. If you can borrow it or make to without it don’t buy it. You don’t need every kitchen appliance, every piece of sports equipment, or anything else you use less than once a year. In addition to having to buy it, you then have to store it.
Love the buy it for life tip.
I did this with a suitcase a few years ago. I was traveling a lot for work, and had two cheaper suitcases break within a month. I ended up buying a crazy expensive one with a lifetime warranty, and 6 years later it’s still rock solid. Even though it cost me almost 4x as much at the outset, I’m pretty sure I’m already close to breaking even on that buy.