10 Ways Americans Waste Money: What You Should NOT Do!

September 17, 2012 Comments Off

It is pretty easy to judge after the 2008 recession that Americans are shot on cash. This is alarming and the importance of preserving money is increasing. The following article tells exactly how Americans waste their money. The reader should learn from these mistakes and try avoiding them.

New purchases
People usually buy products in their original packaging. This means they actually paid twice the regular amount for that product. Try using eBay, craigslist or stop by yard sales and thrift stores.

Accepting those initial offers
Avoid retailer negotiation as many good sellers want your money. Their wants are actually more than your desire for their product.

Purchasing branded products
Americans would spend most of their savings and shopping budgets on branded products. Generics are in. With multiple warehouse stores coming up with their generic brand, you get amazing discounts when purchase these generic brands.

Avoid buying a bigger home
Since the turn of this century, Americans have been spending almost 12% of salaries/ income on energy bills. If you have a bigger home that means you are paying for unused parts and paying more on electricity. The extra room acts as a money drain.

Paying high interest
Usually people don’t understand this. If you are borrowing money for a lavish living that is beyond your reach, that makes banks richer and pushes you deeper towards the poverty line. Credit cards and compound interest increase your payments. Since you can’t pay your balances in full, you end up paying interest throughout the year.

Dining out is costly
Americans eat out thrice a week. With restaurants operating at more than 200% profit, it’s obvious that you are getting ripped off. The cost of cooking at home maybe just a few dollars per meal.

Unhealthy habits are expensive
A government survey estimated that the average American who smokes has a cost of $6 per day. That is roughly two thousand dollars per year. Once medical costs are incurred, this makes unhealthy habits such as smoking very expensive.

Pay for freebies
Paying for stuff that you can avail for free is a waste of money. You will find a lot of “get free” offers online as well as in retail stores. So check these offers before you plan on shopping or buying related items.

Refusing free money
Companies pay extra money if their employees opt for retirement plans. If you ever experience this situation, make sure you take the money. Free money is not taxable and chances are that you will get a tax deduction by applying for a retirement plan. So it’s a win-win situation for you.

Paying extra for insurance
You have a dent on your fender and have incurred $500 damage on your car. Raise your deductible amount from $500 – $1000. This will allow you to save 10% or more on premiums.

These are rough times for wasting money. After the 2008 recession, people have now learned the true value of savings and not wasting money. So try to avoid the mistakes mentioned above and start saving money.

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