Last updated April 12, 2019
You may think that there is no wiggle room in your budget, but that is not necessarily the case. If you look closely enough, you might find that you are wasting money on lots of things, from checking account fees and high insurance premiums to unnecessary subscriptions and credit card interest.
If you are paying for any of the following, you could be throwing your money away month after month.
Paying credit card interest. Running a balance on your credit card is just like throwing money away. If you cannot pay off the entire balance each month, it is time to put that plastic away.
Paying the bank to hold your money. There is simply no reason to pay maintenance fees and incur other charges on your checking and savings accounts. If you and your bank cannot come to an agreement, it is time to move on to a financial institution that values your business.
Paying late fees. Late charges on your credit card and loan payments suck money out of your wallet and hurt your credit score. Set reminders for your monthly bills and use them to make sure the payments get there on time.
Being over-insured. Being under-insured is bad, but carrying too much insurance can be just as bad. You may not need life insurance if you are single. You may not need collision and comprehensive coverage on your old junker. Review your insurance and see where you can save money.
Choosing a low deductible. A low deductible might seem like a good idea, but it could be costing you money by raising your monthly premium. Raising your deductible can lower your premiums and put more money in your pocket.
Spending too much for gas. Gas stations compete with one another for your business. Take advantage of that fact by comparing prices and filing up at the station with the best prices. It is worth driving a little out of your way to save money on gas.
Smoking. You already know that smoking is bad for your health, but it can be just as damaging to your wallet. If you smoke a pack a day, giving it up could put hundreds of dollars a month back in your pocket.
Choosing high cost investments. Investing for the future is important, but you do not have to overpay to do it. Low cost index mutual funds have consistently beaten more costly managed funds. Moving the bulk of your retirement portfolio to index funds could save you thousands of dollars over your lifetime.
Giving up interest. Having an emergency fund is important, but you could be losing out by letting money sit in an account that pays no interest. Once your account reaches a certain threshold, you should be actively looking for a money market account with a good interest rate.
Paying to get your own money back. If you are paying ATM fees, you are literally paying to get your own money back. Look for a bank with lots of local branches, or choose one that reimburses you for ATM fees.