We slog 5-6 days a week so that our hard earned money is made to good use via long term investing and sensible financial planning. However, money wasters are something which all of us do without even realizing it. Small drops of water make an ocean, similarly, if this wastage of money were to be checked and if that money were to be invested, it could form a decent corpus for each one of us.
Check below to see whether you have any of these mindless money wasters with you and think whether it makes sense to get rid of them today.
1. Club Mahindra or similar holidays
Most of my friends who have signed up with Club Mahindra Holidays voice an opinion of disgust that they never get to go to the destination of their choice for a vacation when they want to. That is because that destination is already booked out.
So they promptly go to another secondary destination of their choice and spend their own money on lodging and food without using Club Mahindra holidays. It means that in-spite of signing up with holiday clubs, they put in extra money for spending their vacation. That is a waste of money.
A better approach is not to sign up with such holiday packages and book your own holidays. It’s cheaper, it’s exciting, you are involved and you can blame yourself for any goof-ups !
2. Subscriptions of magazines/books
This could easily go down as one of the favorites for everyone. We hoard books and magazines that we think we will read today but don’t get to them in this lifetime. The books become showpieces in our cupboards and every year before Diwali we bring them down, dust them off and admire our possession.
We do everything but read them. Why waste money on such subscriptions ?
3. Money Wasters Add-ons
Last month when I took my car for it’s regular FREE servicing, the guy threw in a air filter for the AC all by himself. I asked him what it was and he said it would help the AC area to be clean. I queried that if it were mandatory to have, why it did not come loaded with the car which was just 6 months old. He offered to not put it in.
Wherever you go, pushy sales people will stand by to add extra dollops of unwanted stuff to your wallet. You don’t need those extras nor the sales people. Avoid add-ons. Be wary of extended warranty on electronic items and check whether you really need them.
4. Weekends at the malls
Your favourite weekend hangout ? You are not alone – as you can already guess by the push and shove at the mall.
I have never understood why the eating joints at malls are so expensive – one of my friends noted that the popcorn was costing same as one movie ticket.
Going to malls to shop for something mandatory is good but hopping over just to spend time leads you to eat something which is exorbitant and probably junk and money wasters also; shop for a garment which you took a fancy to but don’t need; buy a toy for your “i-want-that-toy-daddy” toddler though his/her birthday was just last week !
Malls, according to me, are the second reason why you can lose your shirt and wallet. The first is the wife of course.
5. Weekend homes – Money Wasters
It’s a great feeling to possess a home of your own. It’s an asset that you are building for your future, probably retirement. However, many investors get carried away by weekend homes being sold by builders. Lavasa, near Pune was marketed as weekend homes. Many investors bought into it.
The only problem they now face is that during the weekends they are still in Pune. They don’t use their weekend homes for what they thought they would use it for.
The concept of weekend homes is nice and yo. However, it does not fit in practically with most investors. First you throw money at purchasing the unit which is holed up in a far far place and then you throw more money after it to maintain it.
Whatever you want to do at your weekend home, you still can do in your current one !
6. Miscellaneous items for the future
This is one very hard to check. You will note that often you pick up miscellaneous items from fairs and melas and even Big Bazaar which you think you will use in the future. The money wasters can range from many types of pickles, bedsheets, toiletries, personal care items and what not.
We buy them because we fancy using them sometime. It often happens that that opportunity never comes and the item becomes too old to be used.
I remember getting a new car cover which I thought I would use to cover my car when I had got it new. I used it probably two times and then the cover ended up covering everything except the car.
Our needs and wants will always be many. It is upto us to differentiate between them, control them and keep spending only on things which are necessary to have.
Are there any other things which you personally have found to be mindless money wasters ?
How about watching movies first day first show at the theaters even though they are worthless.
Most of the movies anyway comes on the TV within a month.
Another one to add is to shop for clothes each month. I think the neceesity to go shopping is one thing which everyone should check because that contributes to a large extent of the money wastage.
@Khalid, I agree – ask the wives !
Movies sometimes its good at the multiplexes – I would still want to watch TRANSFORMERS at the plex.
So true.. Many people would associate with couple/all ways of money wasters mentioned above. Being practical helps us in saving a great deal of money over the time.
You have mentioned all the major money wasters. I have cut down on many of them.
The one I can think of right now is gifting our loved ones. We all become emotional while choosing a gift for our loved ones & seldom think practically of their actual use to them; thus land up buy something very expensive which may/may not be of any great use for him/her.
Is there any way to deal this situation?
@Sudip D, That is a very very valid point you bring up. In fact, my analsysis of 2010 revealed that GIFTing was one of the major heads we spent on.
We have cut down on that now by choosing on mandatory occasions to gift (Birthday is mandatory, Diwali is not !).
One can possibly rotate gifts in kids birthday and not buy news ones.
I gift things which are abolutely required and which I buy only on birthdays and other special gifting occasions. Often I gift cash which can later be used to buy the thing needed anytime in the year.
I have also cut down on a large family outing on birthdays that cuts down dining costs.
Say what, let me do an article on this !
Hi
Add to it the thread mills/cycles, sophiticated gadgets, electronics, clothes, oils & perfumes,…
What is life if everything is perfect, right. Let the economy grow. 🙂
Have a nice day.
@Shinu, Agreed Shinu. A bit of hiccups in life are worth accomodating !
I agree with most of the points here. Eventhough the point 2 ( Subscriptions of Magazine/books) is a valid one I think it is a good thing to spend money on. If I take my example I buy lot of books and magazines on a monthly basis ( including the personal finance magazines). At times I don’t get time to read the books that I bought and it will be lying in my book shelf. But whenever I see an ad/discussion about a financial product in print/TV media I could immediately recollect that I have seen them in one of the magazines/books and I immediately will go an read that book.magazines from my bookshelf. In this way I do not get influenced by the high profile ad about a financial product and was able to take decision wisely. I believe if I do not have subscribed to the magazines/books I might have missed this valuable opinios. So I think it has it’s own plus points.:)
@Shanil, That is fair. I think as long as you go back and read the books, its fine. I was talking more for those people who buy hoards of books but don’t get to it ever.
I think your style where you go back and read about the financial product and do not depend on the TV ad is very wise, it shows you are doing your homework before buying stuff. Continue in this way.
How about compulsive shopping?? A couple of my friends love to splurge on buying dresses and would just visit any shop which offers discounts..Once one of them came with 3 shirts saying the offer was buy 2 get one free (the 2 costed around 2K, but he was happy nevertheless as he got the 3rd one free)!!!
@pradeep, Very good point. Buy 2 get the 3rd free is a great tactic to make the customer buy.