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11 Bad Habits That Frugal People Don’t Have

11 Bad Habits That Frugal People Don’t Have
Amy Boyington Feb 6, 2018
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Frugality is something that some people are driven to accomplish as soon as they venture out on their own. For others, it takes some time and mental training to get used to. But, there’s no doubt that being frugal can put you on the fast track toward financial freedom.

Some money habits are worse than others, and some are sneaky little things that can do some major damage to your wallet and savings. Part of being a responsible adult is knowing how to spend money healthily.

Since most Millennials have less than $1,000 in their savings accounts, it’s obvious that this subject is one we have to do more than just skim across in high school.

The following habits are ones that you’ll never catch a frugal person doing. If you’re guilty of any of them, you can adopt some tricks from experienced budgeters and savers to get yourself on a good financial path.

1. Letting Food Go to Waste

I’ve always hated food going in the trash. This pet peeve of mine has been helpful since becoming a budgeter because I’m always looking for ways to cut my grocery bill by buying minimal food and not wasting a drop of it.

Whether you forget to use up all your leftovers, buy way more than you and your family can eat at the grocery store, or you’re not storing food properly, you’re wasting money by wasting food.

The average American couple spends $625 on groceries every month, and then even more on dining out. I can’t imagine how much of that money gets thrown in the trash from food waste.

I spend no more than $300 per month on groceries for a family of four. And, I never throw a drop of food away that I buy or make.

Here’s What to Do Instead

How can you cut your grocery bill and stop wasting food? What works for my family can work for just about any family.

Twice a month, I sit down and make a meal plan for the next two weeks. I’ll list recipes I want to make and all the ingredients I need for each. Then, I’ll organize it all into a shopping list.

I always try to use recipes that need several of the same ingredients, so I don’t need to buy a bunch of items I won’t use again for weeks or months.

Then I shop, price-checking and comparing the whole way through. I make sure to buy my meats in bulk, if possible, to divide into separate meals later. This trick works well with ground beef and chicken breasts, especially.

Using this process, I save $100 a week on groceries easily. Then, it’s just a matter of using up leftovers. I usually eat them for lunch or send my kids to school with reheated leftovers in a thermos.

2. Checking Over Bank Statements Once a Month

Checking your bank statements only when they come in the mail each month is a terrible habit to start. Although it’s easier than reconciling your income and expenses every week or so, it doesn’t let you stay on top of your finances like you should be.

Frugal people are typically good at balancing a checkbook and frequently checking their accounts to make sure all of their records match the bank’s records.

It not only helps them stay on track with their budgeting, but also ensures that they haven’t forgotten to add any important information to their checkbook that could throw off their budget.

Here’s What to Do Instead

Ideally, you should check your bank and credit card accounts every few days. Why? Because that makes it easier to catch any shady business that might pop up, like someone using your information to make an online purchase or even gaining access to your bank account without your knowledge.

Even more importantly, you can track your spending when you stay on top of your accounts. I have a habit of, every weekday morning, looking over my bank account to balance everything.

Then, at the end of every week, I check my credit card and savings accounts. Always knowing what cash and revolving balances you have is a crucial step in living a frugal life.

3. Always Buying Cheap

You would think that frugal people always buy the cheapest products to save money. That’s actually far from the truth. Instead, we price compare and we’re really, really good at understanding price-per-units.

At first glance, a pack of toilet paper from a budget brand could seem like a better deal. But, when you look at the unit price – usually, the price per roll – you might actually be spending more per unit with the budget brand than the name brand.

Frugal people look for good deals in numerous ways, rather than always taking a price tag at its face value. This technique is how they find awesome savings when they shop.

Here’s What to Do Instead

The next time you shop, take some extra time to look at price tags on the shelves. Most large retailers place a unit price on the tag in addition to the full price. When shopping for meats, for example, you’ll want to look at the price per ounce or pound and compare prices that way.

Guaranteed, you’ll be surprised by how much you can save by comparing units rather than full prices.

4. Spending Frivolously for a Fun Time with Friends

Frugal people know how to have fun. They just don’t do it in ways that eats into their budget.

People who haven’t yet developed their frugal skills tend to spend much more money on outings with friends than they need to. Do you and your friends always go out to eat when you have a night on the town?

Or, do you always pay your own way for a taxi to get to your hangout spot and back home? These are things you can still do, but tweak them in ways that makes more sense for a frugal budget.

Here’s What to Do Instead

First, see if you can think of ways to share costs with others. You’re all going to the same place, so carpool or share the cost for a cab. When you go out to eat, split a meal with one of your friends instead of ordering a full meal and having leftovers that you may forget to finish.

Better yet, order an appetizer and split it instead of a meal.

You can also have some creative, fun nights in with your group. Create an outdoor movie night with blankets, pillows, and a projector and screen setup in the backyard.

Or, have a party game night in someone’s garage and share the cost for ingredients to mix your own drinks. Better yet – make it a BYOB event!

5. Paying for Things They Don’t Need

Do you have loads of monthly subscriptions for services or products you don’t have time to use?

About two years ago, I started looking at my spending more closely, specifically my subscriptions. I had subscriptions to four streaming TV services, several magazines, digital services, etc.

I was spending about $150 every month on all these services, yet I had piles of magazines waiting for me to read them and barely spent more than an hour, if I was lucky, watching TV every day.

Subscription services can be one of the biggest cost-eaters because you forget about them. These services usually set you up with auto-pay, which is good for convenience, but bad when you’re trying to be more mindful of your spending.

Here’s What to Do Instead

Pay attention to what you use in a month. Write down every time you read a magazine or watch TV if it will help you see just how little you might use one of your subscriptions.

At the end of the month, cut what you don’t need, even if it costs $5 a month. It may not seem like a lot, but four $5 subscriptions nixed from your monthly budget gives you an extra $20 you could be saving each month.

6. Opening Tons of Credit Card Accounts

Having a credit card or two is a good idea for anyone who wants to build their credit, which is essential for a future home purchase or personal loan. Responsible credit use and high credit limits with little to no balances are awesome.

But, several open credit card accounts that don’t get used can harm your credit. Even worse, you might be tempted to use them since you have all that available credit just sitting there.

Here’s What to Do Instead

Financially-wise people tend to have just one or two credit card accounts that they use responsibly to build credit. That means that they never carry a balance from month to month.

Instead, they spend only what they can afford to pay off by the end of the month, before the bank charges interest on their purchases.

Stick to one card to start with. Use it to make one or two purchases every month for things you can afford, and pay it off as soon as possible. You’ll watch your credit limit increase gradually, which can boost your credit score.

Furthermore, you won’t be tempted by several credit cards just waiting for you to use them.

7. Buying Whatever Looks Good at the Time

With “convenience” stores all around, it’s tempting to purchase for what you think is convenience. It could be convenient for your time to drive to the corner store and pick up a lunch for work because you didn’t have time to pack one. But, it’s certainly not convenient for your wallet.

Then, you get to the store and find a two-for-one special on bags of chips. Great! Except one bag costs $6, and you could have gotten three of them for that price at the grocery store. Congratulations – your “convenience” store just swindled you into thinking you were getting a deal.

Here’s What to Do Instead

Stuff like this happens all the time. It works, and that’s exactly why stores do it. Once you become more aware of these tactics, you’ll also become better at avoiding them.

Rather than buying things on the spot, you should refer back to the section about creating a meal plan and grocery list and sticking to your food budget.

Include everything you’ll need for breakfasts, lunches, dinners, snacks, and drinks, so you won’t have any reason to head to the corner store.

And, get smart about extra money you don’t have to spend. Make coffee at home and put it in a travel cup before heading to work. Pack some extra snacks for the day. Make sure you have plenty of water so that you don’t have to make a pit stop at your office vending machine.

8. Failing to Negotiate Debt

It can take some guts to talk to your creditors about lowering an interest rate or settling your debt. It’s not a comfortable talk to have, and it can even make you feel pretty vulnerable.

It’s sometimes true that a creditor won’t budge with your debt. However, that usually only happens if you’ve been late with your payments or only make minimum payments every month.

This is one of those cases, though, where you’ll never know what will happen until you try. Doing so could save you a lot of money in future interest payments.

Here’s What to Do Instead

First, make sure you have at least a few months of on-time payments that are more than your minimum payment. This will set a good track record for you to have some leverage in place when you talk to your creditors.

Then, set aside an hour or two after work or on a weekend to call up your creditors. Arm yourself with your current statement and a list of all of your on-time payments.

Honestly, explain why you are asking for a lower rate or settlement. Be prepared with a realistic offer, like cutting $100 off your total if you pay $300 today.

9. Setting Bills on Auto-Pay

Auto-pay, in theory, sounds like a great idea, especially if you’re a person who has trouble remembering bill due dates. This set-it-and-forget-it method is one that most frugal people won’t even touch, though, and it’s not just because they like to have control over their money.

The problem with auto-pay is that it gives you one more reason not to stay on top of your finances. Some bills tend to increase, even if slightly, over time.

When it’s set to auto-pay, you may not realize that your cable bill is moving steadily upward from excessive fees and sneaky changes in your package pricing.

Here’s What to Do Instead

Stop the auto-pay and do a thorough check of your bills’ monthly statements every month. You’ll notice anything out of the ordinary, like extra fees or wrongful charges, more quickly, which can also help you resolve the issue with the company more quickly.

If you feel like you absolutely need to have auto-pay on to not miss a bill, then at least make sure you’re sticking to the monthly statement checking plan.

10. Co-Signing on Someone Else’s Loan

We all want to help our close friends and family members when they’re in need. If that means using our awesome credit to co-sign on a loan for a car or home, then we do it.

Should we, though? Many experts say no. When you co-sign for anything, you’re automatically just as responsible for it as the primary borrower.

That means that the bank can, and will, come after you if the person defaults on her loan. You’ll need to pick up the monthly payment or risk getting sued for the amount owed.

Here’s What to Do Instead

It’s difficult to say no to someone you want to help. This is one of those cases where it’s necessary.

Instead, offer extra cash for your friend to pay back as a loan. If he can’t pay, at least you’ll lose a much smaller amount of cash than you would if you became responsible for the full loan amount.

11. Scrimping Instead of Loving Life

Have you ever met someone who’s frugal that seriously hates being frugal? I haven’t. If you have, then you need to know that person is doing it all wrong.

Being frugal doesn’t mean you can’t spend money on fun things. Everyone deserves entertainment and vacations.

Frugal people, however, get creative with having fun, instead of spending frivolously on things they won’t use more than once or on an extravagant dinner-and-movie night that will be over in a couple of hours.

Here’s What to Do Instead

Need some entertainment in your life? Everyone does! You can still have a vacation and find fun things to do without hurting your budget.

First, look for budget-friendly vacations. Las Vegas, one of the most popular vacation destinations in the United States, is also one of the most cost-efficient! You can also save on travel and hotel expenses by using travel cost comparison sites like Expedia.

For everyday fun, start thinking outside the box. Check Facebook for local events, take advantage of public parks for some outdoor fun, or find local communities that gather for interest-specific entertainment opportunities.

Final Thoughts

Frugal people aren’t perfect, but they know their way around finances. If you’re still figuring out how to save money so that you can start budgeting and being smarter with your cash, you should check out the following articles that can help:

Have any other tips for our budget-loving readers? Feel free to share them in a comment!

Amy Boyington

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