Graphic representing wasting money. Hundred dollar bills dissolve in a man's hand.Photo byevan_huang via Shutterstock

How much money do you waste each year?

That's a life stat none of us want to see, but the harsh truth is all of us are guilty of wasting money in some fashion.

We impulse buy a fancy new trinket, splurge on junk food, or go into debt to pay for a vacation.

Although it’s okay to occasionally reward ourselves (what’s the point of life if we can’t enjoy things?), some things are objectively a giant waste of money.

Are you wasting money on any of these?

The Biggest Waste of Money

There’s no consensus on what the biggest waste of money is. It greatly depends on your financial situation, needs, goals, and perspective.

However, many waste nearly a hundred thousand dollars on a giant expense without seeing any returns.

If you play your cards wrong, a college education might be a giant waste of money.

Wasting Money on College

I’m a college graduate and don’t think my degree was a waste of money.

Education is wonderful, and everyone should be able to pursue knowledge in any field they’re interested in. It’s an elitist nightmare that only rich people can afford it.

However, reality doesn’t always coincide with our idealistic expectations, making college a massive waste for many people.

Here’s how people waste money on college.

Unsure What You Want

If you don’t know what you want to study, you’re better off attending community college for the first two years to figure it out.

Don’t waste money on a four-year degree with no plan.

Attending Their “Dream School”

Many high school seniors become idealistic about attending their dream college, even though it costs 2-3 times more than the local state school.

The University of Illinois is just as good as the University of Florida, so if you live in Illinois, why is your heart set on going to university in Florida?

Those universities are as good as most private schools, so why spend more on the same education?

Dream schools are only relevant to specific fields of study and elite institutions. If you’re not going to the Ivy League or entering a niche field, your local school will provide everything you need.

For-Profit Schools

Far too many students get scammed by for-profit universities, which genuinely are a waste of money. They’re not accredited, lie about job placement rates, and most students don’t even graduate.

Go to a community college for your starter credits instead. If you need to study online, look up programs from accredited universities. Most have robust options for online learning.

Wasting Money on Stuff

Do you buy stuff you don’t need? Many people overspend on impulse buys, things they don’t really need, and shiny extras.

Stop wasting money on these purchases so you can prioritize spending money on what you love.

New Cars

America’s car-centric city planning almost forces us to own a vehicle. However, a lot of us overspend on transportation.

Although new cars have become almost as affordable as pre-owned cars in recent years, they can still be a waste of money if you don’t shop smart.

Depreciation

First, you must consider the depreciation. A new car will lose value the second you drive it off the lot.

However, that depreciation may be worthwhile for the extra peace of mind that comes with buying new. In today’s market, used cars have higher interest rates and don't have the lower price tags that make them the overall best choice.

Buying a New Car Every Year

Buying a new car and driving it until you can’t drive it any more will never be a waste of money.

However, far too many people get caught up in the excitement of buying something new, so they trade their car in every few years. They’re never without a car payment.

Don’t waste money on a new car when the car you have works fine. Conduct proper maintenance to keep it in prime condition. I’ve had my car since 2012, and it’s been paid off for many years. She has over 175,000 miles, and I plan to keep her for as long as possible.

New Phones

Apple releases a shiny new iPhone every year, but do you really need it? Why buy a new one when the one you have does everything you need it to?

Companies trick us into thinking we need the latest new tech, but we don’t. Stop wasting money on a new phone because it has a fun new feature you don’t need.

Instead, get insurance on your phone so you can replace it if it breaks. Keep it until it can’t do everything you need it to do. Don’t buy into the hype that you need the latest model. You probably don’t.

Retail Therapy

Shopping can be cathartic.

Buying something new is a great way to cheer yourself up when you're feeling sad. But it’s also expensive and usually a waste of money.

Would you have bought those things if you weren’t sad? Did you really need them? How much happiness did they really bring you?

Instead of buying all the things when you are sad, try window shopping. It gets you out of the house and engaged (which is what actually helps you feel better), and it’s better for your wallet.

If you find something you want, put it aside and return for it the next day. The odds are that it will still be there, and you can feel good about avoiding impulse purchases.

Think of your retail therapy outing as a planning trip for the next time you need to go out and buy things.

Stuff You Don’t Really Want or Need

How often have you bought something impulsively, only to get it home and wonder why?

I do this when I’m hungry. The other day, we went to the gas station after work, and I bought all the food. I even bought this nasty-looking gas station chocolate cake. Who would want that?

Not me – it’s still sitting untouched on the counter. I Have no idea why I thought buying it was a good idea.

Stores are expertly designed to get you to buy junk you don’t really want. It looks so cute and fancy on the shelf; you must bring it home. Then you wonder how you spent over $200 when you just ran to the store to get a dish towel.

To avoid spending money on unnecessary items, make a list whenever you go to the store and stick to it.

If you think you want something, snap a photo and come back later. Chances are, you will realize you don’t need it and won’t go back.

But it will still be there if it goes the other way! Don’t let fear of missing out on that item manipulate you into making an impulse buy.

Subscriptions

How many things are you paying for each month that you never use?

Do you read those magazines, go to the gym, and watch all your streaming services each month?

If you do, then you’re not wasting money. But far too many of us sign up for stuff, pay for it in perpetuity, and never use it.

Unfortunately, far too many companies have realized that people hate canceling subscriptions, so they’re moving to subscription models for various services, such as software, car seat warmers, radio, and even video games. Then, they actively discourage you from canceling by making it overly complex.

We need to fight back. Stop buying subscriptions and cancel them immediately when you no longer need them, even if it takes an all-day phone call. Spending a few hours to stop a $20 per month payment is worth the effort.

Extended Warranties

Extended warranties are a scam.

Retailers make tons of money by convincing unsuspecting customers that they need an extended warranty to protect their purchase, but that’s not true. Most products last longer than the extended warranty period, and the manufacturer's warranty will cover most of what goes wrong in the first few years.

Stores try to sell extended warranties on the most ridiculous items, like a $40 toaster or $60 Blue-Ray player. Don’t fall for it. It’s easier to buy a new one.

Wasting Money on Experiences

Experiences make life worth living, so I’m loathe to call any experience a waste of money. However, if you’re not paying attention to what you’re spending, some things can be.

Consider whether you’re truly getting value out of these experiences.

Drinks Out

We all need to blow off some steam now and again, but a night out drinking will cost you.

Bars and Clubs are notoriously overpriced. If you want to enjoy time out with your friends, you can pregame at home and limit yourself to one or two while out.

You could also offer to be the designated driver. That way, you can hang out with all your friends without spending needlessly, and you’ll be hailed as a hero for ensuring everyone gets home safely.

That’s a massive win for your bank account!

Things You Don’t Really Want to Do

Some experiences are crazy expensive, and if your heart isn’t into it, why bother?

For example, let’s say you hate roller coasters. Going to a theme park dedicated to them would probably be a waste of money. The same goes for vacations you aren’t really into, movies you don’t want to see, and anything else.

Sometimes, we want to do things because our friends are going. And I get that. You want to be social and hang out with your friends.

But if you hate all things horror, why would you go to a haunted house with your friends? Sit that one out, save the money, and plan the next adventure. The fear of missing out is real, but when you realize that you’d be miserable tagging along or that it’s not in your budget because you’d be much happier doing something else, you know you aren’t really missing much.

Don’t spend your money doing something you don’t want to do just because everyone else does it. And you don’t even have to make an excuse. Say something like, “That really isn’t my thing, but I hope you have a blast!” and leave it at that. Then, spend your money on something that you actually want to do.

But don’t use this post as an excuse not to do something meaningful to your close family. You should absolutely do things that you might not be thrilled to do if your partner, child, or best friend really wants to. They’d do the same for you. Use your best judgment.

Attending Weddings

I know attending weddings and celebrating the love of people you care about is essential, but sometimes, that can get pricey.

Don’t let the bride and groom guilt trip you into spending more than you can afford on their wedding. It’s the biggest day of their life, not yours.

Some couples have outrageous expectations of their guests, demanding they pay thousands of dollars for tickets to destination weddings, unique clothes, gifts, and more. If you’re in the wedding party, you’re expected to shell out even more for bridal showers and bachelor’s parties.

You don’t have to do it. Only you can decide whether the couple has reasonable expectations and whether you can afford to accommodate them. There’s nothing wrong with saying no if it’s not within your budget.

Your Own Wedding

We understand your wedding is special to you, but do you need to spend thousands of dollars on one event?

The average cost of a wedding soared to $35,000. For that, you could buy a new car or use it as a downpayment on a house.

Are you really getting value in a $35,000 party?

There are plenty of ways to reduce wedding costs. You could have the party at a friend or family member’s house, skip the videographer, and use an iPhone DJ. Your financial future is far more important than a party.

Wasting Money Through Poor Financial Management

Far too many of us throw money down the drain because we can’t bother to manage our finances.

Here are the two most prominent ways we waste money by not properly handling our money.

Fees and Penalties

Late fees, overdraft fees, and account maintenance fees add up to make financial institutions millions of dollars.

That money comes out of our pockets.

If you’re paying late fees because you’re forgetful, you must find a better way to manage your money. Put your bills on auto-pay, create a payment calendar, and turn off “overdraft protection.”

Unfortunately, millions of Americans live paycheck to paycheck and can’t always pay on time. It's harder to avoid these fees and penalties when you’re barely keeping your head above water, but anything you can do to reduce your overall payouts will help.

Go to food banks, start a side hustle, enroll in payment relief programs, and stretch your budget as far as possible to avoid these fees. If you need more assistance, check out our article on getting back on your feet when you have nothing.

Interest on Debt

How much money are you paying in interest each month?

That’s the top life stat I don’t want to see.

Everything we pay for with credit costs extra because we’re paying outrageous interest charges in addition to the product's price. While it’s nearly impossible to buy a home or a car without it, many of us pay boatloads in interest on everyday purchases.

Credit cards and store cards have interest rates approaching 28%. This means you'll pay nearly 30% more for everything you buy. Was that cute top worth the price now?

Many of us use debt because we can’t afford life. Emergencies happen and we rely on credit to dig out. There’s no shame in that.

However, it's vital to pay them off as soon as possible. Pay more than the minimum each month. Limit your spending to pay them off. Prioritize paying off your high-interest-rate debt and stop gifting money to massive financial institutions each month.

How Do You Waste Money?

Does this list speak to you, or do you have other secret money thieves hiding in your budget? Take a hard look and determine whether you’re wasting money on things that don’t serve you.

Tell us about them, and let’s find ways to cut back together.

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This artilcle was produced and syndicated by Partners in Fire.