Saving money is a noble goal. Who wants to spend more than they have to, anyways? It can even become addictive, like a game. If you’re not careful, you might even end up spending more money in the long run.
These seven stories will help remind you to always keep your long-term savings goal in mind. That way you aren’t blindsided by short-term “savings.”
Who hasn’t been enamored with the Extreme Couponing TV show, where people get carloads of groceries for free? They make coupons seem like the equivalent of cash dollars—but the only way you can use those dollars is to spend your own money. This sets up a snag where overzealous consumers can easily be tricked into spending more money than they otherwise would have in the quest of using the Holy Coupon and their “savings.”
Kendal Perez, a savings expert with Coupon Sherpa, has some tips: “Coupons, Groupons, and vouchers of any kind that save you money on products, services or experiences you wouldn't otherwise be interested in are ones you should stay away from! Instead of clipping "interesting" coupons from the Sunday circular or browsing Groupon when you're bored, look for coupons on items you already intend to buy.”
Trying To Save Too Much Money
Joseph Hogue, CFA, was in a familiar trap. He hated his first professional job and he wanted to leave. So, he tried saving up all of his cash so that he could retire early from his job.
“I fell into the financial equivalent of yo-yo dieting,” he says. He would take on as much work as possible before becoming burned out and blowing all of his hard-earned money in a spending spree.
He learned the hard way that it’s not enough just to make and save a ton of money. You also need to pace yourself, set realistic goals, and reward yourself along the way. Joseph’s advice? “Find something outside of work you enjoy doing to make all the effort and saving worthwhile.”
Growing Your Own Vegetables
Growing your own vegetables doesn’t seem like it would cost much money. Just throw some seeds in the ground and add water, right? Wrong.
Once you factor in everything you need to grow a garden — tools, soil amendments, fences, plants, hoses, etc… — costs can quickly spiral out of control. Joshua Crum from Repair Rebuild Credit found this out firsthand. “I spent around $100 and tons of work on a garden. Wild animals came and ate everything I planted. I did not see the massive cost to secure the garden ahead of time.”
If gardening is your thing, see if you can buy used equipment instead of new. Also consider planting cost-effective vegetables for the maximum return for your buck.
Not Reading The Fine Print On A Purchase
There are a ton of ways to save money if you keep your eyes open. Receipt-scanning apps, rebates, sales, store loyalty cards — the list is endless. The catch is that you have to be ever-vigilant in reading the fine print so that you can meet the requirements.
Mrs. 1500 from the blog 1500 Days recently found this out. She bought a ream of paper, expecting to use a rebate to have another free ream of paper shipped to her house. “I didn't read the fine print, and the return was in the form of a store credit. I almost never shop there, so it was kind of a waste.”
In another incident she bought a bottle of alcohol specifically for a $5 rebate. “I have gotten in the habit of saying ‘no thank you’ to receipts at the store, to save paper and the environment.” When she got home, she was stunned. “Guess what you need in order to get the rebate? A receipt. Of course, I felt like an idiot for not getting the receipt, having a proof that you purchased the product is a basic tenet to getting a rebate...”
Skimping On Insurance
No one likes paying their monthly insurance premium—until it comes time to make a claim.
According to Neil Richardson from the auto insurance comparison site The Zebra, getting just the minimum liability protection for your state “is simply too little financial protection to cover a number of common car insurance claims scenarios. People end up with huge bills because they wanted to save a few dollars off their premium.”
We recommend checking what insurance options are available with your insurance broker. Ask yourself: would you be able to fully cover the cost of any unfortunate events outside of the minimum coverage? If not, you might need to reconsider your insurance coverage.
Skipping Doctor Visits
Going to the doctor is about as fun as stubbing your toe, not to mention being expensive. It’s pretty easy to self-diagnose yourself over the internet. Sometimes this pays off, but watch out: your Google sleuthing skills might come back to bite you.
Abigail Perry felt a UTI coming on, but decided to treat it herself. “After all, a lot of women try to go my route and just drink lots of water and use cranberry juice/pills.” It quickly turned into lower back pain, however, which was her signal that it was becoming more serious. She eventually ended up spending $75 to go to the ER, whereas her normal doctor would have had a $0 copay.
Abby’s advice is to “just go to the doctor. And if you can't get an appointment there, find an urgent care clinic [rather than going to the ER, if possible]. Just be sure to bring a good book and a charge cord.”
Buying In Bulk
Smart shoppers know that the best way to save money is by looking at the per-unit price of each food item. This often means buying food in bulk. But, even smarter shoppers know to take into account whether you’ll actually use up that food item before it goes bad.
Sometimes this isn’t as straightforward as it seems, and even the best of us can be fooled. Lisa Torres, a retired high school teacher, buys popsicles in bulk during the hot New Hampshire summers—at exactly the same time fresh fruit is in season. “The healthy fruit in the fridge goes bad because we are eating popsicles instead of fruit. And next week I have to buy more popsicles.”
When buying in bulk, it’s always best to stop and take a minute to think if you’ll be able to use all of the product, and if you have any alternatives at home. By taking a minute to think before every purchase, you can successfully navigate through these common savings pitfalls.
MagnifyMoney is a price comparison and financial education website, founded by former bankers who use their knowledge of how the system works to help you save money.