7 Money-Saving Habits That Might Not good Your Finances

7 Money-Saving Habits That Aren’t Actually Good for Your Finances

If you constantly focus on finding ways to save every tiny bit of money, you might not be considering the broader perspective. While being frugal is commendable, it could lead to decisions that appear wise in the short run but end up being more expensive in the long term in terms of finances, time, and overall quality of life.

Allison Sanka, an accredited financial counselor, financial coach, and the principal founder of Journey Financial Wellness, cautioned against allowing an obsession with frugality to overshadow larger life goals in favor of minor savings. She pointed out that the immediate satisfaction of saving a few cents, which may make you feel like you’re advancing toward your financial objectives such as debt repayment or savings, can actually turn out to be more costly when you crunch the numbers.

Commuting Long Distances to Secure Bargains at Various Stores

Sanka explained that even though the potential savings from driving to multiple stores to snag a few dollars off sale items might appear appealing, it’s actually not a wise choice. According to her, any perceived savings will probably be nullified once you factor in the expenses related to your time, fuel, and the wear-and-tear inflicted on your vehicle.

Traveling to Another Town to Cut Gas Costs

Sanka also pointed out that making a trip to a neighboring town to secure a saving of 10 cents per gallon on gas might actually result in higher costs than the intended savings. To illustrate, if your vehicle’s fuel tank holds 15 gallons and you need 14 gallons to refuel it, you’ll be saving $1.40. While this could theoretically accumulate to more than $140 annually if you refuel a couple of times per week, it’s crucial to consider whether this saving justifies the time invested, the fuel expended for the journey, and the added wear-and-tear on your car.

Complete Abstention from Enjoyable Indulgences

“Abstaining from occasional indulgences, like a $4 coffee, won’t lead you to wealth,” Sanka emphasized. Finding a balance is crucial, to reiterate. Rather than having coffee out every single day, consider treating yourself to a cup on Monday mornings to kickstart your workweek. This way, you can anticipate and savor it as a special treat.”

Purchasing Solely Due to Low Price

Sanka emphasised that it is not a wise financial decision to select an item based on its perceived value rather than its actual utility. I’ve seen people in the frugal community buy things even when they’re not really necessary just because they’re 75% off or have a coupon (which is occasionally a tactic to encourage spending), she said. If you spend $5 on something you don’t actually need, you’ve basically overspent $5.

Acquiring Bulk Items Unnecessarily

Being a part of a wholesale shopping club such as Sam’s Club or Costco might make the potential savings from bulk purchases quite alluring. Nonetheless, it’s essential to carefully evaluate if it’s truly advantageous.

Sanka raised a pertinent question: “Is acquiring a case of toothpaste genuinely necessary, and can you actually consume 8 pounds of carrots before they go bad? Research indicates that you often wind up spending more than if you simply bought items as per your immediate requirements.”

Changing Your Own Oil

Scott Lieberman, the creator of Touchdown Money, pointed out that performing tasks like changing your car’s oil by yourself serves as a prime instance of a frugal practice that doesn’t truly enhance your financial well-being. “It consumes nearly an hour of your time, entails the need to manage the disposal of used oil, and there’s even the risk of ruining your clothing — all in the name of saving a handful of dollars. Shouldn’t your time hold greater value than that?”

Doing Your Own Home Improvements

“Undertaking DIY home improvement projects in an attempt to cut costs can backfire significantly,” warned Lawrence D. Sprung, CFP, the founder and chief wealth advisor at Mitlin Financial. “If these projects are not carried out properly, the costs needed to fix the mistakes that result could be much higher than anticipated. The higher cost of hiring a professional is often justified by their ability to complete the task competently and, notably, accurately from the outset. Generally, this approach leads to substantial savings in the long run.”