In a YouTube video, personal finance expert George Kamel, who works with Dave Ramsey, explained that people waste, on average, almost $2,000 per year on impulse purchases. This is money that people could use towards more purposeful money goals, like paying down debt or funding their first emergency fund.
Here are several things people waste money on, according to Kamel. While it’s not an exhaustive list, cutting out several of these items could help people build towards more meaningful money goals this year.
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If people have several subscriptions, there might be a way for them to save money. They likely don’t need multiple delivery apps or streaming services. Consumers can do an inventory of the services they use the most and see which ones they can cut out.
Food delivery apps typically have a significant markup and if people are trying to reach a financial goal, like paying down debt, eating at home can help them save significantly over the course of a year.
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Prepping food takes time, but it can help consumers save serious money. An article from the University of Illinois showed that just over 53% of people are frustrated with fast food prices. That’s likely because prices at restaurants that used to be considered affordable have now increased with inflation.
If people have credit card debt, the interest they pay can make it hard to escape the debt cycle. Whether they have to cut expenses or temporarily pick up a side hustle, consumers should do whatever they can to pay off their debt quickly and avoid spending more on interest costs.
In another article posted to the Ramsey website, Kamel wrote about the cheapest cell phone plans. He explained the average cell phone bill in America is $141 per month, which adds up to over a thousand dollars annually. Kamel also explained it pays to research alternate cell phone plans, especially from smaller carriers.
Gambling could become a serious addiction. Kamel advised against small gambling purchases, too, like lottery tickets. He explained they aren’t a good use of people’s hard-earned money. Instead, he recommended that people invest the money they would have spent on lottery tickets.
Kamel explained that actual millionaires buy used, reliable cars. Plus, Kelly Blue Book reported that most new vehicles lose 20% in value during the first year of ownership. That’s why it’s smart to purchase a used car, preferably in cash. Getting locked into an expensive monthly car payment can reduce cash flow that people could use for other financial goals.
