Avoiding Small Financial Mistakes that Can Cost You Big Money

Small financial mistakes can result in the loss of a lot of money over time. The problem is that many people have a tight budget or simply no budget in place at all. When you live paycheck to paycheck you don’t have the money set aside to invest in things like your retirement or to service your home or vehicle properly. The good news is that you can start anew and cut down on the waste and set yourself up for a financially secure retirement.

Electronic devices

Most people have multiple electronic devices that they rely on daily for work and play. Chances are good that you have at least one computer, a cell phone, a large flat screen TV and possibly a gaming system. These are big-ticket items that can cost anywhere from $500 and up for each one. When you make an investment in something that costs this much you should also purchase things to protect you if they malfunction or no longer work. With all of the items mentioned, you have the option of purchasing an extended warranty, yet many people pass up on it due to the additional money involved. If you think about it, an extra hundred dollars on something that costs over a thousand dollars is wise. The warranties generally last for more than a year, some up to three years. Also, with regard to the iPhone 8, that currently costs a thousand dollars without a plan, investing in iPhone 8 Screen Protectors is important. If you want to ensure that your electronic devices last for a longer period of time without the need for replacing them, you need to invest in the protective add-ons, cases, and warranties.

Small fees that add up to a lot of money

There are many ways throughout the course of a month that people waste money. Many banks charge a fee if you withdraw money from your account and don’t use their ATM. This costs you double. You pay a small fee to your bank of, say, $3 and then a fee to the ATM you use for another $3. If you took out a $100 for the week, you actually took out $106 and threw $6 away. If you do this for convenience four times during the month you now gave away $24. Many people use the ATMs much more than once a week and it can really drain your account slowly. Did you know that if you pay a bill even 1 day late there’s a fee? Take a look at your car payment, credit card bills, gas, electric and cable, they all have an additional fee added if you go past the due date. This can end up costing you $30 or more in a single month. The same goes for your bank account. If you have overdraft protection, your bank will cover the bills but will charge a hefty fee for overdrawing your account. If you add up these three things you’re looking at least a hundred and in some cases upwards of two to three hundred a month depending on how many withdrawals and bills you have during the course of a month. In order to avoid this, drive the extra mile and go to your bank to withdraw money. To make sure you pay your bills by the due date set up automatic payments. Most banks offer this service for no additional fee.

Retirement

When you are young you don’t get the sense of urgency on tucking away money for your future. If you are like many, you focus more on the now with acquiring and maintaining a home and raising a family. The problem is that time goes by quickly and without the proper investments you could end up relying on Social Security benefits, if not solvent, to support you. Without a retirement account such as an IRA or a 401K, you won’t have the extra money to enjoy your golden years. You may end up needing two or more prescriptions each month and these can add up to many additional out-of-pocket expenses. In essence, you worked for most of your life and now at retirement, you can’t enjoy it. If you work for a large company many will match your payment into a 401K. Take advantage of this now to secure your future.

A bright future requires smart decisions when it comes to spending your money. When you purchase a large ticket item take on the warranty. You should also avoid wasting money on things like overdraft, withdrawal, and late fees. Get yourself on a budget and factor in a payment for your retirement.

 


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September 28, 2017 Avoiding Small Financial Mistakes that Can Cost You Big Money