10 Stupid Ways That Smart People Waste Money
Some people are bad with money and they waste it constantly on stupid crap that they can't afford and they are sad all the time and have no friends... That's not you.
You're smart, but even smart people sometimes do stupid things with their money. Smart people are often forgetful, or lazy, or busy, or have enough money that they don't worry about wasting it. Bad idea! Wasting money is always uncool. Here are a 10 stupid ways that even smart people waste money... and a few ideas for how to stop the leak.
We know that you already know all of this stuff, smarty-pants, so consider this list a reminder...
1) Forgetting To Pay Bills: Smart people are often forgetful. "Did I pay the credit card bill? I don't know, I was busy curing cancer."
Late fees suck! Here are some ways to avoid them:
- Pay all your bills at once on a specific day each month.
- Set up auto bill pay with your bank (not with your credit card company).
- Ask someone for help getting organized.
- Set up a Google alert.
- Use fewer credit cards so there are fewer bills to pay.
- Don't use credit cards at all.
2) Bank Fees: Overdrafting fees and excessive ATM and other bank fees are easy to accrue and can be hard to avoid, even for smart people.
Here's how to get organized:
- Go to the ATM once a week.
- If you find yourself always using another bank's ATM, switch to that bank.
- Build up a small cushion in your checking account so you don't have to worry so much.
- Pay attention to how long it takes your bank to process deposits.
- Keep an eye on your balance.
- Switch to a bank that offers ATM fee refunds or that has a large free ATM network.
- Switch to free checking.
- Don't buy things that aren't in your budget.
- Add things like coffee, lunches and snacks into your budget. They're easy to forget.
3) Tickets: Some of the smartest people we know can't seem to avoid traffic and parking tickets. Speeding and parking illegally is a huge waste of money. Here are some tips that will help you avoid giving your hard-earned cash to the man:
- Dispute parking tickets in court. Bring photos and other evidence.
- Don't park illegally! Easier said than done, we know.
- Speeding doesn't save much time, but it will cost you money in tickets, insurance and gas. Stay with the flow of traffic; don't be the fastest guy on the road.
- Never, ever, ever argue with a police officer or make up stupid excuses. Look remorseful, but don't admit that you did anything wrong.
- If you do get a ticket, and you have the opportunity to attend "traffic school" so that it won't be reported to your insurance company, do it.
- Don't talk on your cellphone while driving. Don't send txt messages while driving. Just drive.
- Drive less! Take public transportation if you can. You don't have to worry about where to park a bus.
- Avoid the city of Chicago, especially during the "street sweeping scam" season.
- Pay for parking instead of getting a ticket. If a parking ticket is $75 and parking was $20, who is the sucker now?
- Don't forget to feed the meter! Set an alarm on your phone if you're forgetful.
4) Memberships: How many memberships do you have that you don't use? Gym memberships, museum memberships, cultural center memberships, Netflix memberships... Enough with the memberships!
Here are some questions to ask yourself about your memberships:
- "Does it save me money?"
- "Does it support a charity or non-profit? Is it tax deductible? Do I actually deduct it?"
- "Do I use it?"
If you don't use that gym membership—cancel it. Better to be fat and rich than fat and poor.
5) Subscriptions: Do you have a large pile of magazines that you're "going" to read? Cancel them. You'll never notice they're gone.
6) Letting food spoil in the fridge: Yes, we know you meant to make it for dinner, but then Betty called and you went to see that new movie and... and...
- Plan your meals.
- Buy things you can freeze.
- Buy dry goods in bulk and produce less often.
- If a bunch of food is about to go bad, invite all your friends over and cook for them rather than waste it.
7) Wasting Energy: It's just so hard to turn the lights off...
- Use powerstrips to turn off lots of things at once.
- Don't leave your computer on constantly for no reason.
- Turn out the lights.
- If you're going to sleep with the TV on, don't sleep with the TV, the XBox 360, the stereo, the Wii, the CD player, the lights...
- Insulate your home.
- Plant trees on the sunny side of the house.
- Don't leave the air on when no one is home.
- Turn the heat down during the day.
- You don't need to leave the lights on for the cat. Cats can see in the dark.
8) Letting your money sit in a checking account: You could be earning interest in an online savings account. Why just let all your money sit in your checking account? Stop that!
9) Buying DVDs you will never, ever watch, or books you'll never read, or clothes you will never wear...: When buying something ask yourself: "Will I watch this more than once?" or "Will I actually read this?" or "Do I really still like Rush?" If you answer yes, buy it. If not, don't.
10) Paying too much for cable: Ask yourself if you watch all the premium channels you pay for. If not get rid of them. Also, ask yourself when was the last time you called up your cable company and threatened to cancel? You should do this every year. It keeps them on their toes.
We have a lot of smart readers, but no one is perfect. Tell us how you stopped your money leaks!
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Comments:
I'm really bad about letting vegetables go bad. One they go in the crisper pan I forget all about them. When I think of them again, usually they are a liquid black mess.
I actually bought a year's subscription to the local paper to get the weekly coupons in the Sunday paper. Those coupons usually paper for the paper and them some. Especially if you have small kids (diapers) or a pooch (dog food, dog treat coupons).
*pay not paper.
I was a sucker for the DVD/Book thing for the longest time until my old man recommended half.com and subsequently sites like bookfinder.com and directtextbook.com. Combine those sites with the coupon/savings sits (bargainist, etc.) and I've saved a ton of money. I also found that law school is quick way to immediately kill the whole "reading for fun" thing.
@public enemy #1: I'm the same way with veggies. I no longer buy anything I can't freeze since it'll just end up rotting anyway. It's not as healthy as fresh stuff, but it is healthier then rotten stuff...
As far as the checking/savings thing, just watch out if you transfer money between your checking and savings account multiple times during a month (or whatever period it may be) because there are apparently federal regulations for how many transfers or payments you can make out of your savings account. HSBC sent me a letter twice. However, if you just set a monthly budget based on your paycheck, etc., and then transfer the excess to your savings, you should be ok. Also, HSBC doesn't count transfers from checking to savings made at an HSBC ATM.
I saved money buying marrying a man who is a whiz with money. He's not good at spending money effectively, but that's where my tightwad tendencies come in. We make a great team when it comes to finances. I take care of the groundwork (grocery shopping, buying clothing, etc.) while he's moving money around in accounts that's way above my head. Like that crappy poster from high school: "Teamwork makes the dream work."
@CaptainSemantics: Oh dear, I just read the first sentence. That is a major typo. I promise I did not buy my husband. Why buy when you can get it for free!
I'd say the woman in the photo above is pretty smart. It appears she bought a talking coffee mug...
Don't leave the air on when no one is home.
If no one is home for a week, turn it up to like 82-4. If its just a day (like going to work), a few degrees higher than your normal setting is ok.
Turning it off completely, especially during periods of high humidity, can cause central air to have to start all over dropping the humidity and then shifting heat outta the house.
Uh, most smart people realize that obsessing over nickels and dimes doesn't pay over the long run. Saving a $100-$200 bucks a month doesn't add up to "lets retire to St. Croix type money" anytime soon. My time is valuable (both professionally and personally) so if I save time but waste a few bucks - big freaking deal. At the end of the day, I'll miss the time, at the end of the year, I won't miss the two grand or so I "might" have saved.
Gosh, I sure would love to avoid parking in Chicago, particularly during April-November, but unfortunately, both my job and my apartment are located here.
Thankfully, Chicago has a super-stellar public transportation system, which totally isn't going bankrupt at the same time that it's both raising fare prices and cutting services. Whew!
(I have lived in Chicago for four years and have received exactly two parking tickets, both in the first year, when I lived near Wrigley Field. I agree that the street cleaning system is a total racket, but it IS possible to keep an eye out for those bright orange signs.)
I don't understand why one should not setup auto pay for one's credit card with the credit card company. If you pay the entire balance every month (as every smart person should) then only the credit card company will know the balance you have. The bank wouldn't know how much you owe.
@AnnC: if you aren't on a regular pay schedule, like you work on commissions, you need a little more flexibility than auto bill pay offers.
Medical bills tend to get high. If your doctor tells you to lose weight to avoid diabetes, high blood pressure, etc., try and get it done. It's rough, I'm trying to do it myself; but I don't want to be like the rest of my family with their lines of pill bottles that they have to take every day. They tell me how much each prescription costs and that is scaring me more than the diseases themselves.
@vonskippy: uh, at $200 a month, that $2400 a year. If you have more than 20 years until retirement then you can retire to St. Croix. I realize 20 years is not a "anytime soon" but retirement isn't meant for anytime soon. There's too many people trying to get rich so they can stop working.
@filmsnack: I have to say, the CTA is an enormous PITA, but driving and parking around here is even worse. At least for me, considering where I live (Boystown) and work (the Loop).
I keep seeing, "Don't admit to anything" when getting pulled over. I haven't gotten a ticket in about 12 years. The few times I have been pulled over since, I did not try to BS and say I had no idea why. I admitted to it, apologized, and was respectful, and was let off with a warning.
When you were going 80 in the 65, and you get pulled over, "No officer, I don't know why," seems downright silly.
@ceejeemcbeegee: Many credit card companies have the option to auto pay the full , the minimum, or any specified amount. Some also have onetime payments. I'm not sure what banks can offer that would be better for credit card payments.
Avoid the city of Chicago, especially during the "street sweeping scam" season.
How intriguing, please elaborate.
@AnnC: I think some people are wary of giving their credit card companies their bank account info--for privacy or security reasons or just to maintain control over their bank accounts.
I'm glad Chicago was pointed out. I have two tickets right now I need to settle from a couple months ago. I swear signs go up the morning of cleaning, or the night before. One of them was legitimately my fault, I left town for a couple days (I would still like to see at least 2-3 days notice at the very least, but I wont ask for too much) and got a ticket for cleaning. The second one I literally saw half my block get tickets for. It's ridiculous, and no one can ever point me to any rules about how much notice they have to give.
I'm still waiting to hear how my contest goes, but that's another story, because contesting a ticket here is like playing slots, you have just as likely chance at getting it dropped whether it was a legit ticket or not.
But at least I got notice today that my CTA pass is going to be more expensive starting next month! Yay.
@stubblyhead: Many neighborhoods in Chicago have temporary orange signs that they put up on trees from approximately April-November in place of permanent street cleaning periods. You can roughly expect them to go up every 4-5 weeks, but there seems to be no set schedule, and the department responsible for street cleaning is notorious for putting them up at the very last minute.
@not_seth_brundle: Agreed. When I lived near Wrigley, I would try to use my car only for groceries and the occasional trip to the suburbs.
Wow, that article hit the nail on the freakin' head. I'm guilty for all except the tickets.
@AnnC: As a general rule, NEVER allow your creditors access to your bank account. That means things like utilities and gym memberships, too.
It means that they have the power to deduct however much they think you owe them. If they screw up, and think you owe more than you really do, or if you have a dispute over something, then they'll have your money for however long it takes to get it straightened out.
Doing it through your bank means that you control when and how much money gets sent.
I learned how to cook. Really cook, with ingredients. Not craft dinner and cheetos. I lost weight, my mad food skilz are the envy of all my friends, and my food bill plummeted. I cook what i buy and eat what i cook and freeze leftovers and eat them later.
I'm mindful of what i buy at which grocer, as there's a *500%* difference on some identical item prices between my two faves.
I buy my very expen$ive cookware at thrift stores for 2~6% retail.
I dumped cable.
I made a point to be within biking distance of work and i cyclecommute year-round (west suburban chicagoland, fwiw). Cycle commmuting leverages frugality by limiting impulse visits/spending on the way home from work. (i.e. no more let's go to best buy and buy something!)
I switched to compact fluorescents for 90% of my house when Menards had them on sale super cheep.
We installed a motion-sensor light switch in the kitchen. Walk in, the lights go on. Walk out, and they go off after a couple minutes. Before, that light would stay on almost all the time, because we'd either leave via the exit that didn't have the switch, or because we'd assume that we'd be right back.
There are also some neighborhoods which have regular street-sweeping (eg the third Thursday of every month).
The random street-sweeping is the worst though. There have been many occasions in which I have come home from out of town to find my car ticketed for street sweeping that I, naturally, had no idea was coming. They generally put the signs out a day or two before. And they'll ticket you multiple times for the same offense. It's a ridiculous revenue-generating scam.
The neighborhoods in which parking is at a premium (Lakeview, Ravenswood, Lincoln Park, etc)have much more street-sweeping than the outlying neighborhoods where everyone has a garage. Odd, that.
@Pasketti:
Ha, I need that for my wife, who excels at entering a room, turning on lights, tv, etc, then leaving. I'm starting to think that she is getting paid under the table by ComEd.
that cable tip is right on. i recently called comcast for the first time in a year to ask about getting basic (really basic, like $12 a month basic) cable. the lady told me she found a year long promotion for me that would let me keep my digital cable and save $20/month. sweet, except i wonder how long i've been paying more than i needed to.
@theWolf: This (wo)man tells the truth. I went from west lincoln park in an apt complex that was mostly around single family homes with garages that averaged cleaning once every couple months to East Lakeview where there isn't a garage to be found where cleaning is every 3-5 weeks, on a completely irregular schedule. Sometimes both sides, sometimes one with the other the next day, it's out of control, and trying to ask ahead of time if you're going on vacation wont get you anywhere, no one knows anything until it's too late and you have 2 tickets.
The worst thing has to be the "cleaning" that happened a couple weeks ago. My apt faces the street, so I'd have heard any cleaning going on. Signs went up on a Wednesday night, "cleaning" Friday. They came through with the tickets sure enough, but no street sweep every came through. It's a complete scam and everyone knows it.
Easy for me to say, living in a city with half decent public transit, but owning a car is pretty stupid for most people.
1. If you can take the subway or bus to work/school (or even better, walk - you need 40 minutes of exercise a day anywa) and only need a car to run errands, sell your car and sign up for car sharing. I figured that even if I drop $40 a week and $50 a year on Zipcar, it's still cheaper than paying for gas, insurance and maintenance myself.
2. If you really, really, really need a car to get to work/school, you're lazy/disabled/in the middle of nowhere. Chances are, riding a bike to work won't add that much time to your commute (and may actually shave a few minutes).
Depending on circumstances, it can be advantageous to pay your bills late. A college professor once told us a story of a company(I can't remember which) who decided to pay all their bills 3 days late every month for a year(basically before the substantial late fees kick in) and at years end, profited over $1 million in interest earned over those 3 days.
I am guilty on 5 out of 10, so I guess I'm only 1/2 smart.
HI, I am gulity of 7. I leave my desk light on at night when I sleep. It is very bright. I only do it because I am afraid of ghost. Serious.
What kills me on my banking is number dyslexia. I don't know how many times I'll stare at my balance and swear up and down it states 192 when its 129. I'm not talking about a quick glance either, its a long 2min stare trying to figure out where the 36 dollars came from. Typically happens when I'm tired, if I'm really tired it happens when I read but not as bad as numbers.
I'm 8 for 10 on this list. I don't subscribe to anything, and my power is included in my rent, but I still way overspend. Just keeping track of everything you spend- I do it in an excel file- really helps. It all adds up so fast, and seeing that really helps curb the addiction, or whatever it is.
@spinachdip: Sorry but I have to disagree there. Whether or not you need a car depends on a lot of things.
Take me for instance. I live in the burbs of Detroit. Because of the whole "Auto Capital of the World" mentality around here there is an absolute need for a car. Public transportation is non existant and there is no way I could ride a bike to work because I have to dress business casual at a minimum. A polo and sweat stains doesnt cut it.
If I had another choice I would take it in an instant.
@spinachdip: "2. If you really, really, really need a car to get to work/school, you're lazy/disabled/in the middle of nowhere. Chances are, riding a bike to work won't add that much time to your commute (and may actually shave a few minutes)."
I completely disagree. In the Mpls/St. Paul metro area, the public transportation situation is abysmal (but, I admit, getting better). Of the 11 people in my department at work, only 3 live within reasonable walking/biking distance (under 3 miles). I'm the next closest person at 10.0 miles. While there *is* bus service - heck, there's a bus depot just 3 blocks from the office and another just 4 blocks from my home - the schedule doesn't run late enough for any of us to actually use it for evening transportation.
As for biking/walking the 10 miles? Please... In my car, the morning commute takes 15 minutes and the evening commute is about 20 (I also admit that it's mostly highway and against the regular rush-hour flows). There's no way that riding a bicycle is going to be faster than that. If anything, the commute times will go up to at least an hour each way. Forget about trying to ride through the snowdrifts in January.
I don't live 'in the middle of nowhere', nor am I particularly lazy. Public transportation just doesn't work out well enough and the bike ride turns out to be an average workout for a triathlete.
@Rupan: I admit, I was painting with an incredibly broad brush. But too many people who think they're dependent on cars simply haven't considered the alternative seriously enough. I can definitely see that Detroit is a notable exception.
So yeah, I've exaggerated a little and am now backtracking.
@ReverseCarpetbagging: I am perplexed by the federal regulations on the number of transfers to/from your savings account. What is that all about? I got hit with a $10 fee at WAMU one month and the teller told me "federal law prohibits me from refunding that fine."
on #1 - sometimes things get a little tight & you cannot avoid a late fee. in those instances, it's good to prioritize bills based on late fees. for example, a credit card may charge you $40 to pay late whereas your electric co. might only charge 1% of the bill (on a $150 bill, that's $1.50).
Sure that works for normal, sane jobs. If you work crazy hours or you're on call, especially if your city's public transit leaves something to be desired (Louisville area has a ways to go), you HAVE to have a car.
Besides who doesn't ENJOY driving? I feel sorry for the people that do not. It is one of life's simplest pleasures.
@spinachdip: You predicted responses like mine. It's nice that you live in a city with decent public transport. You probably live in a sufficiently dense neighborhood that it's convenient to walk to the grocery store, too. Kudos for you. When I lived in Milano, I could walk to the grocery store and I took the Metro to work (when they weren't having a strike.) I liked both of those conveniences.
Here, it's 1.5 miles to the nearest grocery store (on the other side of a busy interstate highway with no pedestrian-friendly crossing, and summer highs in the upper 90s are the norm.) It's even farther if you want something besides groceries, and no I don't live in a suburb. The nearest ZipCar location is 992 miles from my house, which is not exactly useful, to say nothing of convenient.
I'm not saying you can't plan communities for significantly less dependence in the automotbile. Even as a car enthusiast, I think that would be a great idea (assuming Americans would cooperate with the plan.) In much of the US it's extremely inconvenient to live without a car. It's not the first thing I'd cut out of my budget.
Re 10: Just cancel cable completely. If you like TV-based programming, get a Netflix subscription (or, god forbid, Blockbuster subscription). Even a subscription that lets you have an absurd number of discs at a time is probably a lot cheaper than your cable TV bill.
@spinachdip: In re #2: Well, you're wrong. I admit I'm an outlier, but as a sportswriter, there's no freaking way I'm biking to road games that are a good 40 miles off. And bouncing between two offices that are also about 25 miles apart. Is it safe to say I exist just to counter the whole "public transport or bicycles uber alles" crowd? ;)
"Cats can see in the dark."
My cats can't! But they only have one eye each.
I'm bad about #9 (buying DVDs/books/etc). I do watch and read them, usually more than once, but this IS why God gave us libraries and I AM out of storage space already! Sheesh!
@spinachdip: "If you really, really, really need a car to get to work/school, you're lazy/disabled/in the middle of nowhere."
I live in a city. I work 6 mile from home. The only way to get there is to cross the mile-wide river is on an expressway where bikes are illegal. The next bridge, a few miles downstream, is also expressway. I think it's about 8 miles downstream before there's one bikes are legal on, and it's not real safe. Am I lazy, disabled, or in the middle of nowhere?
I am so glad i purchased all of those DVDs that I thought I was going to watch over and over in college. They are just taking up space in a cabinet....half.com here i come!
@Vicky: it's called regulation d. it's complicated, but basically, the fed requires banks to create a "capital reserve" of funds on deposit in the event they become insolvent. think of it as an insurance policy. the calculation that determines how much needs to go into this fund varies based on "transactional" (checking/line of credit) & "non-transactional" (savings/certificates/money markets) accounts. if a non-transactional account exceeds 6 electronic transfers/month, then it is deemed to be a transactional account. the bank must then manipulate its "capital reserve" ratios, which quite frankly is a huge pain in the ass.
so, essentially you can think of this as a "you're being a huge pain in the ass" fee.
I indulge my book habit at library book sales and thrift stores. The library sells yellowing or raggedy books for ten cents, decent quality paperbacks for fifty cents, and hardbound books for $1, which I never buy. Even better, I volunteer at the library book sale and at the end of the month, when we pull the books that didn't sell, I go on a spree of books bound for the dump.
At a thrift store, I got a gorgeous leather bound Crime and Punishment at a thrift store for $2. The library supplements its meager fundage with the book sale, and the thrift store benefits the hospital that's letting me use their psych services free.
So if I'm guilty of all 10, doesn't that mean I'm smart?