7 Everyday Money Leaks From Holes in Your Pocket
Never underestimate the impact of money leaks that is draining your financial wallet. Money leaks can add up to a lot over time. It is easy to overlook them because the amounts going out usually start as small. However, where they are recurring, money leaks become major. Recurring expenses have a compounding effect over days, months and years.
It’s like having a water bill that is rising from just having a tiny leak in the toilet. Drip…drip…drip…day by day. Before you know it, you find yourself wondering why your cash outflow gets to such a big sum. It’s like having holes in the pocket. You may have stuffed stacks of cash inside but oddly enough, some have disappeared.
You could have been afraid to look at your bills, invoices and credit card statements. Understandably, most of us just do not enjoy receiving them. Yet, an honest review of your expense account would have revealed where your money leaks are coming from.
And so, I would like to suggest that you make a date with money the coming weekend. Work through the pile of unopened bills statements. Start a spreadsheet and identify where your money leaks are coming from.
7 Everyday Money Leaks From Holes in Your Pocket
Money Leak #1: Health Club Memberships That You Don’t Utilise
You might have grand plans to go to the gym or swim and that was why you signed up for a health club membership. However, just because you signed up for one, does not mean much until you use the facilities. If you are not using much of your membership, you may want to look at cheaper alternatives. How about buying home workout programs from Beachbody? Or jogging at the local park? The question is: How can you achieve the same objective with cost-effective measures?
Money Leak #2: Subscriptions to Print Newspapers or Magazines That You Don’t Read
Are you subscribing to print newspapers or magazines but not reading them? How about going for the cheaper digital versions? By minimalising the demand for paper, you are also doing your part for Earth.
Money Leak #3: TV Subscriptions That You Don’t Use
What about your subscriptions to various channels? Are you utilising them regularly enough or it’s a good-to-have but rarely-used choice? Once again, are there cheaper entertainment alternatives that you can consider?
Money Leak #4: Food Waste
A study by the Natural Resources Defense Council found that Americans waste 40% of their food purchases — which equates to an average of $2,000 per year, per household. Get some meal planning done. Meal planning with portion management will help in deciding how much grocery to buy each week. You reduce your expenditure, as a result.
Money Leak #5: Food Spending in Gourmet Restaurants
Who doesn’t enjoy the luxury of dining in gourmet restaurants? I know I do. But as I have discovered, the sky can be the limit when it comes to food spending.
Luckily, there are plenty of options. You can eat a roast in a fine dining hotel restaurant or a family joint. While you are very worthy of great gastronomic experiences here on Earth, it is prudent to avoid spending beyond your means. Don’t deprive yourself completely either, if you can help it at all. Keep restaurant spending to a percentage of your overall food bill.
Money Leak #6: Things You Don’t Have Immediate Need For
Do you tend to buy things that you do not have an immediate need for, especially when there is a sale going on? Do you keep them in the storeroom and forget that you have even bought them after some time? A spring clean is going to show up what these items are.
The next time when there is a sale, if you do not forsee yourself using an item in the next 6 months, refrain from buying it. Look away. You can always purchase the item closer to the time when you need it.
Money Leak #7: Minimum Payment on Credit Card Bills
Are you paying minimum sums on your credit card bills every month? It sounds appealing to pay only minimum sums because you don’t have to encounter big cash outflows on the due date. However, there is interest component on the outstanding amount that you will need to pay, if you are only making minimum payments.
Hence, may I suggest that you make it a point to pay your credit card bill in full as best as you can. I have enough friends who paid just the minimum sums, even though they had enough savings to pay the entire credit card bill at first. They landed themselves in trouble eventually.
Make Money Dates and Not Money leaks
The above money leaks are ones that I pay attention to. I still can’t say that I particularly enjoy combing through my bill statements. However, I get that it is a necessary exercise.
Fortunately, I have been able to work through my money blocks enough to make regular dates with my husband concerning financial matters. Together, we look through spreadsheets and accounts. We still find it hard to part with some areas of luxury spending but we are certainly on the look out for better alternatives.
You may want to do the same for yourself too. Identify spending that are not necessities and that are money leaks. Ask yourself if some of the recurring expenses are really necessary and devise a better way forward. Eliminate these items from your spending forever.
Love and abundance always,
Your Comments and Thoughts Please
What are the money leaks that you have personally identified? Share yours below.