Money Draining Habits to Avoid
Many people believe to save money, you have to make more money. However, the real battle is learning how to hang onto the hard-earned money you have. In the world of convenience and technology, delivery and “one-stop shops” that are open 24/7, saving your hard-earned money can feel like an uphill battle. Avoid these money-draining habits to get your household back on track with budgeting.
Drain #1: Impulse Buys
Research shows impulse buying has skyrocketed since Covid-19 first hit, but there are tips to help you break it. Online flash sales, eye-catching items while walking to checkout and unplanned purchases can completely drain your savings. Americans spend upwards of $276 per month impulsively. Although statistically these purchases provide immediate comfort and convenience, down the line they can add to financial stress and debt. Here are a couple of tips:
When grocery shopping, make sure you have eaten before or are not hungry. When you're hungry, you are more likely to make impulse purchases on products from the store that you don’t need. The same thing goes for regular shopping as well. If you can’t limit the number of trips you are taking to the store or reduce the time spent looking online, make sure you’re not shopping while tired, hungry, or stressed because you are more likely to act on impulse. Set a budget and stock to it. If you need to prevent purchases, remove your autosaved credit card information, so you must manually add your information.
Drain #2: Being underinsured or Overinsured
Whether you’re underinsured, in cases of a fire, car accident, or medical emergency, you can be forced to break open your savings impacting yourself financially. On the other end, being overinsured can also hurt you. Paying for unnecessary insurance coverage that you don’t use can also deplete your finances.
Always compare deals when shopping for insurance coverage, and make sure your policies are up to date and are what you need.
Drain #3: Regulation of temperature in your house
Wasting energy can be another way your money is silently slipping away, whether a poorly insulated attic or basement, air leaks throughout your house, or overheating/overcooling your house. Not only does that waste energy, but also your money.
Always make sure your house is insulated correctly and when possible, refrain from using your thermostat. You can try opening a window, using an extra blanket or sweater, or just turning it down when you won’t be home can save you money.
Drain #4: Not Planning Ahead
If you have ever felt the pain of buying a $10 magazine or $20 pair of headphones at an airport, you know that not planning is another way you are draining money.
Anticipate what you will need for the next trip or event before you go. Plan. Pack. Save. It is better to overpack than to be forced to waste money on something you could have planned for. Always carry snacks, sunscreen, water bottles and other essentials to stay prepared and avoid overpaying.
Want to learn more draining habits to avoid?
Talk to one of our associates at First National Bank LI, and let us help you save money, so you can keep that money in your pocket, where it belongs.