When’s the last time you took a good hard look at the money you waste? We all do it — even personal finance writers. I like to think I have a pretty good handle on my spending, and then I remember how many times I’ve paid credit card interest, thrown out food, and hung onto a streaming service for longer than I should have.
Here are four little ways we’re all wasting money — plus what we can do to tighten our budgets.
1. Food waste
We waste a frightening amount of food in this country — the USDA says 30%-40% of the American food supply ends up in the trash. This number is not solely due to us buying food that we then don’t eat, but it’s a contributing factor to the problem. And besides the environmental impact of food waste, it can be a budget-buster, too.
Say you throw away just $10 worth of food every week. Over a year, that waste totals $520. The Motley Fool Ascent found that in 2022, Americans spent an average of $475 per month on groceries — imagine throwing away more than a month’s worth of your grocery spending.
What can you do?
Shopping with a grocery list has never steered me wrong. Take the time to go through your fridge and cabinets before shopping, and take stock of what you already have.
And if you belong to Costco or another warehouse club, take special care with buying grocery items in bulk — saving money on the unit price does you no good if you end up throwing away half of your haul.
2. Aggressive driving
We’re all in a hurry and we’ve all got places to go, but driving in an unsafe manner is costing you money in a few different ways. For starters, you’ll pay more in fuel costs — the Department of Energy says that speeding and rapid acceleration/braking lowers your gas mileage by 15% to 30% at highway speeds and 10% to 40% in stop-and-go-traffic.
And if you’re an aggressive driver, you’re putting your life and safety at risk — not to mention that of other drivers on the road. This will translate to higher auto insurance costs if you’re in a wreck. (Plus, there’s also the risk of permanent injury and death.)
What can you do?
SLOW DOWN. That’s step one. Stop speeding, and remember that you are not the only driver on the road. Your fellow drivers also have important places to be, and we all deserve to arrive there safe and alive.
I also recommend asking your auto insurer if there’s a defensive driving course you can take. I’ve taken one twice, in 2020 and again in 2023 (it was good for three years), and for a nominal cost of about $25, I got to learn about how to more safely share the road with others and save 10% on my auto insurance premiums. Win win.
3. Bank fees
Many of us have fallen into the trap of bank fees. Personally, I’m still a little mad at myself for wasting money on low-balance fees for my big-bank savings account in 2022 — $5 a month for 10 months doesn’t sound like much, but that $50 could’ve bought a decent dinner out for a partner and I, or covered more than half of my usual weekly grocery tab.
Bank fees can be sneaky — you can be charged for letting your balance go too low (like I did), not having any account activity for a period, or even making too many withdrawals from a savings account. You can also be charged for overdrafting your checking account — Statista found that overdraft fees averaged more than $26 each in 2023.
What can you do?
It’s 2024, and there are a slew of banks that charge minimal fees. You’re no longer beholden to that local bank or big national bank that charges you monthly maintenance fees, overdraft fees, or inactivity fees. Look to online banks — they have lower overhead costs and can give account holders a break on the fees and even likely pay you a higher APY on your savings account to boot.
4. Subscriptions/memberships you don’t use
It’s easy to sign up for a subscription box, gym membership, or streaming service — and then completely forget you did so. You’re getting charged for that service and you’re not using it, which is the very definition of wasting your hard-earned cash. And again, $12 or $15 a month doesn’t sound like a lot, but over the course of a year, that could be $144 or $180.
What can you do?
I know, your life is busy — mine is too. But take the time to sit down with your credit card or bank statements and see what you’re spending money on every month. Knowledge is power, and if you spot a recurring charge for $12 or $15 for a streaming service, subscription box, or fitness center you’re not actually enjoying, cancel it. If you miss it later, you can join again — I promise.
Bottom line — for your budget’s bottom line
Your No. 1 way to avoid wasting money is to pay attention. Explore the food you already have before shopping, be a focused and mindful driver, read your bank’s fee schedule, and cancel subscriptions you don’t use.
Saving small amounts of money can add up to more cash for vacations, entertainment spending, and even a complete emergency fund — all of which are surely better ways to use your money.