We often spend money without any legitimate reason. Spending a small amount of money here and there without any reason, or to support our bad habits, can add up to an enormous amount in our lifetime. I recently read about the “latte factor,” which I found pretty amazing. The popular financial author and TV personality David Bach gave an example of a Starbucks Coffee latte: If you drank Starbucks Coffee every morning before work, costing just $5, you could be spending $1300 a year just on your morning coffee; Pretty amazing right?
Spending your money on little things can add up and compile into a small fortune over a long period of time. The problem is, if you are spending your money on things that are actually unnecessary and bad for you, you are really wasting your money. For example, instead of buying coffee every morning from Starbucks, if you bought $5 worth of apples form a grocery store, you could be spending that money on something that improves your health. If you are buying an extra $5 dollars worth of fresh produce from your grocery store weekly, your money is being well spent, but if you are blowing your money away on bad habits, you need to re-think your finances.
Wasting money does you no good, and it doesn’t help you gain a better lifestyle. Here are some other ways in which you are blowing away your money that is costing you a fortune:
If you smoke a pack of cigarettes a day, smoking could cost you over $2000 a year, not considering healthcare costs. That is enough money to go on a week’s vacation with your significant other or friends and family. Also, consider how much you would be earning if you invested that amount of money every day. For example, say instead of spending $5 a day on a pack of cigarettes, you decide to invest it. That would be $150 a month, earning you over $3000 within a decade at a 7% return. Now imagine how much money you could make in returns if you invested that money throughout your entire life!
Gambling is often regarded as a voluntary tax for people who are bad at math. The odds of winning small prizes on lottery tickets are very low. Even if you buy a $1 lottery ticket per day, you are throwing away $365 a year; a considerable amount of money. The odds of you hitting a jackpot or the mega millions dollar prize are lower than the chances of you getting struck by lightning. If you become a compulsive gambler, like going to casinos every day, are throwing away thousands of dollars a year.
Its okay if you allow yourself to indulge in a drink or two once in a while. However, beers and drinks in nightclubs can become expensive and add up quickly. If you drink three beers at a nightclub twice a week, it could add up to $120 per week on average, which in turn adds up to $6240 per year.
4. Junk Food
Eating burgers and fries at your favorite fast food restaurant may not seem as bad as drinking or smoking, but if you are regularly eating fast food, it could easily add up. We are not even considering the indirect health hazards and costs that you could incur from your health care provider. Just like drinking alcohol, if you are addicted to fast food and soda, it could end up costing you $2000 a year extra, depending on what you eat.
5. Not taking care of yourself
If you are not visiting the doctor for regular checkups, it could end up costing you big time in the long run. Regular annual checkups could easily detect potentially fatal diseases before they become a problem. You could also be risking your life by avoiding your doctors’ advice, or by not working out and avoiding physical activities. Regularly interacting with others can go a long way by saving you in health care and hospital bills, or by saving your life. You can take better care of yourself by paying more attention to your personal health, hygiene, and by taking regular medicinal supplements such as multivitamins. Having a balanced diet could also be saving you hundreds or even thousands of dollars annually.
Regular self care and maintenance of your health plays a major role in sustaining a happier and healthier life. Try to stay stress free and take good care of yourself as well as your belongings. You should save up enough money so that you can take a break from work, go on a vacation, or save up enough to retire. Every little bit of money that you waste on your bad habits could negatively cost you when you are trying to save up for much bigger goals.
We will be posting more advice on saving money and boosting your financial health in our future blogs, so keep reading our blogs and come back often. We’d also love to hear from you, so please don’t hesitate to put down a few words in the comment box below.
Source: Balanced Life Team.