Finding ways to save money is critical to every person achieving their financial goals. It could be the difference between a comfortable retirement and having to work in your latter years. Every day, millions of people are robbed of their hard-earned money due to expensive habits. Today, I would like to take at look at some of these habits. These four habits will cost you money and get in the way of your financial independence.
Smoking is one expensive habit to pick up. Not only is smoking bad for your health, it’s bad for your wallet as well. Smoking raises the price of health insurance and decreases the money in your bank account. According to MSN Money, the average price for a pack of cigarettes nationwide is $5.00 and only getting higher. A pack of cigarettes is already costing $7.50 in Massachusetts and $10.00 in New York. If you smoked a pack of cigarettes a day, than you would be spending $35.00 per week. This would come out to $1,820 per year and over $54,000 over a 30 year period. That’s assuming that cigarette prices stay stagnant, which we all know won’t happen by a long shot. What would you do with an extra $54,000 dollars?
Gambling comes in many different forms, but the end result is always the same. The house always wins. People gamble away their paychecks playing casino games, cards, online games, slots, and lotteries. Millions of people travel to Atlantic City and Las Vegas each year to gamble in casinos. Everyday people lose money playing lottery games such as Keno or trying to win the Mega Millions jackpot. A sad fact about lotteries is that the people that participate in them are always the ones who can least afford it. Low income individuals are the biggest players of lotteries. 82% of lottery revenue comes from low income individuals. Gambling is an addictive habit that can end up costing you more than you bargained for.
Have you ever gone in a department store looking to buy one shirt and left with bags full of clothes? While it’s okay to splurge on occasion, it shouldn’t become a habit. Most people engage in impulse shopping. Impulse shopping occurs when purchases are made out of emotion. A good example of impulse shopping is going to the mall and coming home with an item that you never planned on buying. Department stores count on shoppers making purchases due to impulse buying. Remember to always shop with a plan and to stay within your budget. An easy way to avoid impulse shopping is to only take enough cash for your preplanned purchase. That way if you are tempted to go over budget, your wallet will make the decision for you! Alternatively, you can make a list that you adhere to while shopping. This can really come in handy when you go to the grocery store hungry and end up buying everything that looks good.
Do you regularly pick up items from your local convenience store? Do you pay your bills or get money out of the ATM at your local gas station? You will definitely pay more for the “convenience” of convenience store shopping. Stores like 7-Eleven, Royal Farms, and Wawa’s charge huge mark-ups on most food items, snacks, and toiletries. Convenience stores charge hefty transaction fees for routine services. ATM fees at convenience store can be as much as $3, plus your bank’s fee. Bill payment services and money transfers also carry charges higher than most grocery stores. Going for a road trip? Pack a lunch or snack instead of stopping by one of these convenience stores. It’s often healthier too!
Do you know of any other habits that are dangerous to your finances? Have you recently conquered any financially devastating habits? If so, what did you do to stop it?
(photo credit: purpleslog)