Giving away money is kind, charitable, and downright awesome—when you’re doing it on purpose. But giving away money accidentally is one of the worst things you can do for your budget—and your financial future.
What do we mean? Mistakes, fees, and other financial mixups can nibble away at your money, with nothing to show in return. And wasting money like this is easier than you might think. Here are a few of the most common ways people give their money away, and how to avoid them.
Paying Bank Fees
Bank fees are one of the most insidious wastes of money there is. Imagine the audacity of being charged for accessing your own money! And yet they’re one of the most common ways for people to waste money. ATM fees, credit card penalties, and more really add up. If you Using a money management app like Mint can make it easy to spot fees when they happen, and once you see them you can start eliminating them.
As a rule of thumb, never use an ATM that charges you a service fee (unless your bank automatically reimburses you, as some do). Pay your credit cards on time to avoid spending needlessly on financing fees. And make a note whenever you’re charged a fee by your bank—then plan ways to avoid that fee again in the future!
Using Food Delivery Services
There’s nothing inherently wrong with ordering takeout instead of cooking at home, but it’s way too easy to waste money doing so—especially if you’re using food delivery apps like GrubHub or DoorDash. Delivery apps tag on convenience fees that quickly add up, just for the convenience of ordering through the app menu instead of picking up the phone.
Is it really worth a few dollars for you to not have to speak? Sometimes it is. But it shouldn’t become a habit.
When it comes to food, the best thing you can generally do for your wallet is to plan your meals ahead of time and buy your groceries in bulk. While this isn’t always possible, it should be your default approach. It’s okay to deviate from this once in a while, but you’ll see how quickly it makes a difference in your bank account when you’re not overpaying for food all the time. And when takeout is the only option, be sure to call the restaurant directly instead of spending extra money to use an ordering app.
Have you ever carried a gym membership, but never went to the gym? What about subscriptions to magazines you don’t read, or streaming services you rarely use? All of these are unnecessary expenses that chip away at your finances. And as digital subscriptions become more and more common, these wasted expenses will be even harder to avoid.
As more people cut their cable bill to save money, cable companies are responding by offering more streaming services. For example, HBO offers a standalone digital subscription now, which is great if you don’t want cable but still want to see who ends up on the Iron Throne. But if you’re still paying for that and not watching anything after the series ends, it’s over a hundred dollars a year spent on nothing.
Check your bank statement monthly to make sure there aren’t any recurring charges on there that you aren’t actively using. This can be a bit of a reality check as well—if you’re paying for a gym membership or magazine subscription that you have every intention of using, but you aren’t actively going to the gym or reading, then you need to be honest with yourself and cancel the subscription until you have more motivation to take action.
Paying for Tax Software
You might think you’re saving money by doing your taxes yourself, but the truth is that you probably aren’t. The price of do-it-at-home tax software and the price of seeing an accountant are comparable, and with a tax professional you’re guaranteed to save the most money on your taxes. You have no such guarantees when doing it yourself.
Relying on a qualified accountant is your best bet for getting the most out of your tax return. Plus, it’s a whole lot easier to hand all your paperwork to an expert than it is to sit down and hash it all out yourself. If you’re going to pay to do your own taxes, it’s well worth it to pay the professional instead.
Buying Expensive Coffees
This one can be such a money waster that we felt it important to list separately from ordering takeout. Many people have a daily coffee habit that involves going to a store and paying upwards of $5 for a cup of coffee. As accountants, we simply can’t condone that!
Making your own coffee at home is fast, easy, and far less expensive. Plus, you could be cutting out countless calories of fats and sugars if you make the switch from sweet and syrupy coffee variations. An occasional trip to your favorite cafe is a well-deserved treat. A daily visit is a huge waste of money.