Being broke stinks. It can feel like there’s never enough money to cover the essentials, let alone the extras. This can leave a cloud of stress constantly weighing over your head.
But even when your budget feels stretched thin, there are smart spending choices you can make to stretch your dollars further and avoid the trap of spending that is deeply instilled in our culture’s habits.
Here’s the thing: some purchases, even if they seem tempting at first glance, can drain your bank account faster and make it harder to get ahead. This list outlines 10 things to avoid buying when you’re on a tight budget. By avoiding these money pits, you can free up cash for the things you truly need and start building a brighter financial future.
1. Brand-New Cars
That shiny new car on the lot might be tempting, but it’s a major depreciating asset. A study by Edmunds.com found that new cars lose an average of 19% of their value in the first year alone. This means you’ll be underwater on your loan for a significant amount of time, essentially paying interest on money that’s disappearing into thin air.
Consider buying a reliable used car. You can find a well-maintained vehicle that will get you where you need to go for a fraction of the price. Check out resources like Kelley Blue Book or Consumer Reports to get a good idea of fair market value before you buy.
2. Trendy Clothing and Accessories
Keeping up with the latest fashion trends can be a strong pull. No one wants to feel ‘out of style’, and those targeted ads sure know how to make those new sneakers look irresistible.
Trend-driven clothing, however, often comes with a hefty price tag. And let’s be honest, those styles can go out of fashion just as quickly as they came in. Prioritizing high-quality basics that can be mixed and matched to create various looks is far more financially savvy. Thrift stores and online secondhand marketplaces can be treasure troves for stylish finds without the shocking price tag.
Instead of focusing on fleeting trends, invest in classic pieces that will work for you season after season. Building a capsule wardrobe is an excellent way to ensure style and flexibility without draining your wallet.
3. The Latest Tech Gadgets
Everyone wants the newest smartphone, the sleekest smartwatch, or the most cutting-edge home entertainment system. Tech companies make us feel like we desperately need every upgrade.
New gadgets, however, come with eye-watering price tags, and they often depreciate the moment you take them out of the box. Unless your current technology is malfunctioning, consider holding onto what you have. It’s likely still perfectly functional – you just lack that sparkly new model to compare it to.
Before upgrading, ask yourself – do you truly need the newest version, or do you simply want it? Are there crucial features that would seriously improve your life, or are you just chasing the latest and greatest for the sake of it? Tech sales and open-box items are great alternatives if you need to upgrade without paying full price.
4. Restaurant Meals and Takeout
Whether it’s fast food or a sit-down meal, dining out can eat away a huge chunk of your budget. Delivery apps make it even easier to overspend. Research shows the average American household spends $3,008 per year on dining out.
Rediscover the joys of cooking at home. Plan your meals to maximize your grocery budget and minimize food waste. If you’re time-crunched, try batch cooking on the weekends or invest in a slow cooker for easy dinner prep.
5. Bottled Water
Bottled water is expensive and environmentally unfriendly. A 2020 report by the World Wildlife Fund found that plastic pollution from single-use water bottles is a major environmental concern. Plus, the cost of bottled water adds up quickly.
Invest in a reusable water bottle and fill it up with tap water. If you’re concerned about the taste or quality of your tap water, you can purchase an economical water filter. This is a much more cost-effective and environmentally friendly option.
6. Fancy Coffee Drinks
Grabbing your daily caffeine fix on the way to work is routine for many. Those enticing specialty drinks become a comforting habit, offering a touch of indulgence amidst a busy day.
But while your daily $5 latte might seem harmless, it adds up fast. Over a week, that’s $35, and over a year, it’s well over $1,500 – money you could be putting towards savings or paying down debt. Making coffee at home is a simple way to slash this expense.
Love the experience of a coffee shop? Treat yourself occasionally as a planned expense rather than a daily splurge. Brewing coffee at home doesn’t have to be boring – invest in flavored syrups or a milk frother to jazz up your home coffee game.
7. Brand-Name Groceries
You’re paying a premium for marketing and packaging when you buy name-brand groceries. Generic store brands are often made in the same factories as the name-brand versions and taste virtually identical.
Embrace store brands! Blind taste tests often show people can’t tell the difference. Check out those lower shelves and compare those ingredient lists – you might be surprised by how much you can save.
8. Lottery Tickets and Gambling
Hoping for a life-changing win from the lottery or a casino jackpot is a pipe dream for most. The odds are stacked against you. You have a 1 in 292.2 million chance of winning the lottery in the United States, and the house always wins in casinos.
Put those dollars towards building an emergency fund. Even a small cushion can help you avoid taking on high-interest debt if an unexpected expense arises.
9. Premium Cable Packages
We’re in the golden age of streaming, and those pricey cable packages with hundreds of channels you never watch just don’t make sense anymore. Cable companies rely on introductory offers and complicated long-term contracts to keep you paying more.
Cut the cord and switch to a streaming service or two. You’ll save a bundle, and you’ll get to watch what you want instead of endlessly channel surfing.
10. Extended Warranties
Extended warranties on electronics and appliances are often a waste of money. These warranties typically cover things that are unlikely to break during the extended warranty period, and they often come with a hefty price tag. Additionally, many manufacturers already offer a basic warranty on their products.
Read the fine print on the manufacturer’s warranty before buying an extended one. Consider opening a dedicated savings account to put aside the money you would have spent on an extended warranty. This way, you’ll have a pool of money to draw from if your appliance does break down.
11. Subscription Services
With the rise of subscription services, it’s easy to get caught up in multiple monthly payments for things you may not even use regularly. Take a look at your subscriptions and determine if they are necessary or if you can find cheaper alternatives. If you’re barely getting by each month, the reality is that all of those subscriptions likely aren’t necessary.
Consider consolidating subscriptions or sharing them with family or friends to save money.
12. Going Out for Drinks
Happy hours and nights out with friends can quickly add up, especially if you frequently go to expensive bars or clubs. Consider hosting a night in instead, and have everyone bring their own drinks or make it a potluck-style event.
If you want to go out, consider having one drink before heading out to limit the number of drinks you’ll buy while out. Or switch to water after one or two drinks to save money and avoid a hangover.
13. Regular Salon Visits
Maintaining a certain appearance can be costly, especially if you frequently get your hair and nails done at salons. Consider learning how to do some treatments at home or opting for more budget-friendly salon options. Experiment with DIY treatments or try out new styles that require less frequent upkeep.
14. Gym Memberships
Gym memberships can be expensive, especially if you’re not using them regularly. Consider alternative forms of exercise, such as running or at-home workouts, to save money on gym memberships. If you do prefer the gym, look for budget-friendly options or try out free trials before committing to a full membership.
15. Impulse Buys
Impulse buying can easily ruin your budget and lead to clutter in your home. Take a step back and think through purchases before making them. Consider waiting 24 hours or creating a budget for splurges to prevent impulse buys from derailing your financial goals.
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JayDee Vykoukal is a writer, author, mom, and Doctor of Physical Therapy. She has been writing about everything motherhood and health-related since 2018 when her first daughter was born, and she wanted to stay home. She loves to research new topics and fun facts with her kids to teach them about the world.
