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Start Increasing Your Wealth By Increasing Your Savings
A good way to increase the total amount of money in your bank is to decrease your spending. With the massive amount of distractions that are available in our daily lives, it’s easy to forget what things are taking away our money. In fact, some of these things we might not even be aware of.
Here are the Top 10 common-money wasters put together by Frugal For Less with tips on how to avoid them. Think that something should be in our list but isn’t? Let us know in the comments below.
1. Vampire Energy
There’s a silent killer among us, and it’s sitting right inside of your home. Vampire energy, also known as standby power or phantom energy, is a daily energy waster that bypasses the knowledge of the common American. This energy is referred to the energy that is wasted by electrical appliances just from being plugged in.
When your TV is turned off, have you ever noticed the red dot in front of the screen? This means that your television is still using power despite the fact that it’s not in use. The television consumes a large amount of energy just to be in standby mode.
The reason for this is that the television is a widely-used item. Being in standby enables your television to start-up at a moment’s notice. That’s not the only thing, however. Vampire energy can be emitted from everything plugged in, including cell phones, laptops and microwaves.
Statistics state that vampire energy may consume up to as much as 10% of your energy consumption.
Here are three key tips to help you avoid this dangerous enemy:
1. Unplug everything before you leave the house
This includes items that aren’t even plugged into anything else. Cell phone chargers that are not plugged into a cell phone are the worst, saying to still use 10% of the power it takes to use cell phone.
2. When something is fully charged, stop charging it.
When your laptop or cell phone is at 100% battery power and still plugged in, it still uses roughly 60% of the electricity it normally would. There’s no need to continue charging it.
Furthermore, leaving your devices plugged in at full charge will only reduce its battery life even more. Replacing your battery for your laptop can cost up to $80 depending on the model.
3. Use a smart power strip
These power strips may be a bit costly, but will definitely save you money in the long-run. They work to reduce the energy being wasted from appliances put in standby mode.
What’s best about these strips is that you can shut off all of your power in one fell swoop by hitting the power strip off button. You will be sure to notice a difference in your electrical bill the first month. Now there are power strips that come with an additional USB outlet as well. I found this great one here on Amazon for under $30.
4. Turn Off Your Lights
Last but definitely not least, make sure to turn out your lights. This doesn’t count as vampire energy since when the lights are out they don’t still suck away power, but turning them out before you leave the home or when you don’t need them can add an enormous amount to your savings.
Read about how vampire energy could be costing you $300+ per year.
2. Cable Television
I’m not here to state that watching TV is a waste of money, but rather that there are much cheaper alternatives or completely free ones. Thousands of hours of television shows and movies are now available via the internet. Here are some great options for watching TV:
1. Find Television Shows on the Internet
Specific television shows are even posted online for you to watch. For example, the latest episode of the Daily Show can be found at thedailyshow.com. The only downside is that new episodes are quickly taken down, so if you really enjoy a television program, make sure to check when new episodes come out.
2. Amazon Prime
Amazon Prime let’s you can watch 40,000 movies and TV episodes, borrow kindle books at no price and get free unlimited 2-day shipping for any product you order off of the Amazon website. The cost is only $99 for an entire year, or roughly $8.50 per month. This is a lot better deal than you would get from your cable provider. You can even try a 30-day free-trial here.
Hulu.com is a website that hosts a wide variety of television shows and movies. The selection is enormous and even has international shows for you to choose from. You can upgrade to the Hulu Plus version for only $7.99 per month, further increasing your selection.
Compared with the cost of running cable television for roughly $30 or more per month, this is definitely a much better resource to help you get the shows you want to watch.
Similar to Hulu, Netflix offers TV shows and Movies for you to watch for $7.99 per month. Netflix makes it easy for you to connect their program to your television so you don’t have to watch it from a small computer screen.
This is probably my main resource for watching any type of video, and it’s completely free. It’s usually very easy to find a specific television show and episode by typing in its name in the search bar. Almost any show that you can think of will be uploaded on to this website.
If you’re trying to watch movies on Youtube, they can be quite difficult to find. This is probably better for those that prefer to watch television shows.
3. Earning No Interest on Your Savings
You may have a sense of security if there’s a nice chunk of change lying in your bank account, but if you’re not investing it or earning any interest on it, you’re losing money due to inflation.
It may not seem like it, but the American dollar is in decline, and inflation rates are only going to increase as our country keeps printing more and more money. If your going to keep your money in a bank, the least you can do is put it in a savings account that gets a little interest.
However, I personally do not recommend this. Today, banks pay out a lousy rate of roughly 0.50%. Inflation is known to increase at an average of 3% a year, meaning you’ll still be losing your your money in the long-run. So what can you do?
The best way is to invest your money. If you’re looking for tips on how to get started investing your money in the stock market, I suggest Investopedia’s Investing 101 for a beginner’s guide to get an idea of how the market works.
FX Academy is also a great resource. While it is meant to be for high-risk Forex trading, they also offer beginner courses for the complete novice.
4. Airplane Tickets and Hotels
Purchasing an airplane ticket or renting a hotel isn’t necessarily wasting money, unless you’re paying full price. These days, with more credit cards than necessary available at your doorstep, there are plenty of ways to accumulate enough credit card points to get you a free airplane ticket or a free night in a hotel, or at least a significant discount.
A lot of these credit cards have huge sign-up bonuses. After spending a certain amount of money after opening an account, they will give you hotel points or airline miles just for making purchases using their card.
Here’s currently my favorite card out right now, the Barclaycard Arrival Plus™ World Elite MasterCard® . After spending $3000 within the first 3 months of opening account with this credit card, they will provide you with 40,000 travel points. These points can be redeemed for up to $400 toward your next travel purchase. Take a quick look below.
Here’s a quick glance at the card:
- After spending $3,000 in the first 90 days of opening an account receive 40,000 miles in points
- Earn 2X miles on all purchases
- The card has an installed chip which makes it easier for purchases abroad and at home
- Points can be redeemed for anything related to travel – hotel, flights, rent-a-car, etc.
- Redeeming your miles for travel credit gives you an extra 10% on miles redeemed
- No foreign transaction fees
- Free online FICO® Credit Score
The other card I fully recommend for travel is the Capital One Quicksilver Card. This card gives you 1.5% cash back on all purchases, no matter what your points are used for.
The Barclay’s Card only gives you 2% cash back when redeemed for travel and only 1% in cash for all other purchases. Depending on how much you travel, the Capital One Card may be better for you.
Stop paying full price for something when you can get it for a discount.
5. Purchasing Auto Insurance When Renting a Car
You know those questions they always ask you about renting a car regarding if you’d like to purchase their auto-collision insurance? Well, thanks to credit cards, there’s no need. Many credit cards automatically include the added benefit of giving you collision-insurance when you rent a car at no extra cost.
The catch is that you MUST decline all insurance offers that the rental-car agency offers you. The insurance is actually quite good. By using a credit card to make a purchase, Visa is willing to insure you up to $100,000 in any major accident and $50,000 in injuries.
Mastercard and Discovery also offer collision insurance when renting a card. For more information on saving when renting a car, check 7 Steps to Save Up to 60% When Renting a Car.
6. Coffee (Sorry Starbucks Lovers)
I know that every man needs his coffee, but is there really a need to go to Starbucks or any other coffee shop and purchase a 12 oz. Coffee every day?
I know of people who purchase two of those Venti cups at Starbucks every 24 hours. Depending on the cost of the coffee, these can cost up to around $5 a cup. Purchase two of these a day and that’s $300 per month on coffee alone!
You could simply buy a new coffee maker for as little as $20 (or a used one for cheaper) and then go to the store and buy a few packs of coffee for the month, costing you maybe around $30 in total. After the first week, depending on the amount of coffee you drink, you will have gotten a return on your investment.
If you absolutely have to have Starbucks because they’re so tasty, I understand. You can check out my Monthly Giveaway Page where I sometimes give out free $5 Starbucks Gift Cards.
7. Credit Card Fees
You might be aware that your interest rate on your credit card is high. The thing that worries me the most is that you might not know on how to reduce your current rate or get it reduced to 0% for a short time.
This has to be by far the worst category to place your money into. Credit card interest rates are not only alarmingly high, but have the potential to increase your current debt at an alarming rate.
If you currently hold credit card debt and are sitting at 18% interest, the best thing you can do right now is either call the credit card company and ask them if they can lower your rate, or do a free balance transfer to another card. Often when you apply for a new credit card, they allow one free balance transfer to another card as a nice introduction bonus.
What’s even more is that some of these credit cards offer 0% APR on your interest for the first year from when you open a new account.
Another fee you might not come to think of is the annual credit card fee. This can be as much as $100, and credit card companies aren’t going to remind you when your 1-year anniversary of opening an account is near.
8. Spending More Than You Have to at a Restaurant
I love going out to eat with good friends and to have a good meal. Yet sometimes eating at a restaurant can quickly put a damper on your wallet. Even the drinks alone can add a few extra dollars to your tab, making what seemed to be a nice evening out turning into a disaster for your financial situation.
Alcohol is by far the most expensive when a great alternative is drinking at your friends’ place for half the price. Getting drunk and calling a taxi to drive you home only adds more to your bill.
Obviously, the best way to save money from dining out is to eat at home, but we don’t want to have to sacrifice a nice evening with friends if we don’t have to. There are plenty of ways to actually save money at restaurants if you look and put a little effort into it.
Check out this article on 10 Steps to Save 20% Dining Out at Any Restaurant for great tips to saving some extra cash on that next meal.
9. Bargain Shopping and Cheap Items
There’s nothing wrong with looking for sales when going out shopping. In fact, it’s usually the best way to go. However, it’s usually a good idea to think about what we actually need before we buy it.
Before you swipe that credit card, it’s always a good idea to ask yourself if you really need that item. If it’s just another useless object that will get thrown in your closet or be used only once a year, it might be a good idea to hold off even if it seems like a good deal. Most of the time you can find the same price somewhere else, especially without a lot of stores offering to do price-matching these days.
The one exception I can see to this is if the price of an item is so low, that you could buy it and resell it for a profit. I often did this with selling books during college, in which I made $600 in one semester with minimal effort. It
Another point to consider is that a lower price often results in a lower quality item. Durability is a very important factor to consider when making a purchase. If I’m going to buy a TV that will last for only a few years compared to one that will last me 20 for a 10% jump in price, I’m most likely going to buy the more expensive one.
10. Gym Membership
If you own a gym membership but find yourself not going to the gym, it may be a good idea to cancel it. Mark Lipanski, a personal trainer in Menlo Park, California, told the San Francisco Chronicle in 2009 that “about 12 percent to 15 percent of Americans own gym memberships, and of those, 40 percent actually use them.”
There are still other ways to work out, such as running outside, riding a bike or even cleaning around the house is known to burn roughly 150 calories per hour.
If you don’t want to cancel your membership, try finding a gym with a cheaper offer or getting a downgrade on your current membership.
If you have any other ideas on how to prevent wasting money, feel free to leave them in the comments below. Thanks for reading.