6 Big Time Money Wasters
FaithFi: Faith & Finance | Jul 17, 2023
Show Notes
Before we get into the specific money wasters, there’s a general principle you should be aware of: If you’re buying things that provide only a temporary sense of satisfaction, you’re probably wasting money. If it’s not a necessity and you grow bored with it, it was a waste of money. Check your closets for examples.
Now, we’re not saying you should take a “vow of poverty.” The Lord wants us to enjoy the resources He’s given us. But that must be tempered by the principle that we’re merely stewards and we need to use His resources wisely.
But, of course, we live in a culture that promotes spending. It’s a big problem. One survey showed that the average adult spends around $1,500 a month on non-essentials. No wonder so many Americans are living paycheck to paycheck.
Imagine what that kind of money would do if it were put into savings or invested for retirement.
6 MONEY WASTERS1. Not preparing your own meals. The first money waster is one of the biggest, but it’s also one of the easiest to fix.. It’s okay to eat out occasionally, but too often it’s just for convenience. By some estimates, a restaurant-prepared meal will cost you three times what you would pay for the same meal cooked at home.2. Upgrading your smartphone as soon as a new one comes out. For example, the iPhone 14 could cost you as much as $1,600 or lock you into a long contract if your carrier provides it.
Eventually, a smartphone will have to be replaced, but the longer you delay the upgrade, the more money you keep in your pocket. This year’s red hot phone is next year’s discount model.
3. Overspending on clothing. Wearing the latest fashion is expensive. By some estimates, the average American spends nearly $2,000 a year on clothing.Clothes do wear out and need to be replaced, so you must include that in your budget, but those spending decisions should be practical.
4. Buying lottery tickets. The ads say “You can’t win if you don’t play,” but that’s nonsense. You definitely will win if you don’t play. You’ll get to keep your money. You have better odds of being hit by lightning twice than winning the lottery.Plus, you don’t want to participate in something that disproportionately hurts the poor. A Bankrate report found that low-income households spend as much as 13% of their income on lottery tickets. That’s far more than higher-income earners.
5. Extended warranties. Extended warranties are now a $40 billion-a-year industry, and it’s really just an expensive form of insurance that you probably won’t need.Instead of buying an extended warranty, do your homework to make sure you’re buying a quality item to begin with. Most will have an adequate manufacturer’s warranty anyway. And then make sure you have enough money in your emergency fund to cover any repairs you might need to make.
6. Cable and streaming packages. If you’re still paying for cable, it could be as much as $200 a month for Internet and TV. Do you really need 568 channels?More and more folks are dropping cable and satellite TV and using only streaming apps, but even there, you can waste a lot of money.
A new survey by FinanceBuzz showed that a quarter of households have at least 3 more streaming apps than they had a year ago, and 1 in 10 reported they have no idea how much they’re spending on streaming.
So keep track of what you’re watching and if you’re not getting your money’s worth from an app, drop it. That’s one great thing about streaming apps — no service contract. You can drop it any time you like.
Those are your 6 big-time money wasters. We hope you find this helpful.
On today’s program, Rob also answers listener questions:
- Are capital gains taxed differently from regular income?
- Is title theft insurance a wise thing to buy?
- Should you ask a wise parent for financial advice or turn to a completely impartial source?
- If family members stay in the home of a parent with dementia, could that have ramifications for Medicare?
Remember, you can call in to ask your questions most days at (800) 525-7000. Faith & Finance is also available on the Moody Radio Network as well as American Family Radio. Visit our website at FaithFi.comwhere you can join the FaithFi Community, and give as we expand our outreach.
