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It’s the most wonderful time of the year….to spend.  You cannot walk in a shopping mall, listen to the radio or watch 10 minutes of television without being tempted by retailers to buy their tantalizing products.   Whether it is the latest technological gadget, a one-of-a-kind holiday must have or a snazzy new pair of boots, you feel a “need” to have it.  Especially if you pay only half price if you buy two items, right?  There are numerous reasons why we waste money, but spontaneous spending and emotional spending are some of the most common. 

Here are some common ways why and how we waste money:

  1. Shopping for comfort.  Whether you are blowing off some steam or need a pick-me-up after a troubling day, a mood tends to perk up after buying something.  It’s probably the most common reason for frivolous spending.  If it’s not in your budget, don’t buy it.  Instead, a brisk walk, a cup of tea and the ear of a good friend will lift anyone’s spirits.
  2. Speciality coffees or Lattes.  During the holiday season coffee shops are busy tempting us with their intoxicating themed drinks like egg nog flavored coffee or gingerbread lattes.  The scents coming  from these shops could tempt the most frugal of us.  These special treats can cost anywhere from $4 – $7.  Times that by 7 days a week and that the cost could be as high as $49!
  3. Eating out.  If you spend even $9 a day on a lunch because you don’t brown-bag it, that’s $45 a week, and $180 a month. If you cannot discipline yourself to make lunch every day, you can cut back a few dollars by bringing your own drink, or buying a less expensive item from the menu.
  4. Buy something to get a second item at half price.  Heard this sales pitch before?  Most stores, especially during the holiday season, promote this type of sale.  It sounds great, but if your budget for a pair of shoes is only $50, then you have no room for a second item no matter how great the deal is.  If you participate in more than one of these kinds of promotions, you may sink yourself into debt pretty fast.
  5. Brand name clothing.  Buying a good quality sweater may be a “need” for someone, but buying one from a branded store is a “want”.  If you only wish to buy from your favorite brand, shop at discount or outlet stores that carry that brand instead of purchasing at the brand’s landmark store.  Landmark stores incorporate their operation costs in their merchandise, passing on those costs to the consumer.
  6. Cell phone contracts.  Do you use your cell phone to chat or do you use it just to touch base quickly with most calls lasting under a minute? If you’re not a big talker, opt for a pay-as-you-go plan that may cost approximately $15 a month or less, as opposed to a contract with more minutes for $30 and more per month.
  7. Do you drink bottled water?  It’s important to drink up to 8 glasses of water every day.  If water comes from a tap for free, why are we constantly buying bottles of water?  Some bottles of water can cost up to $3.00.  This can be costly if we buy a few of them each day.
  8. Buying Phone Apps.  Apps can be helpful. They can find bus times, organize our schedule, and provide us with entertainment when we’re bored, but sometimes they’re a waste of a dollar. If you buy one app a week for a dollar, it will cost you $52 a year.   Instead, why not try free apps or demos?

Don’t let frivolous spending sink you into debt.   You would be surprised how quickly debt can spiral out of control before a person is strangled with loan payments (Payday loans have the highest interest rates) and threatened with personal bankruptcy.  In order to avoid the guilt and desperate feeling that comes once the bills start flowing through your door, you should prepare your budget for spending and stick to it.  A prepared and sensible budget will keep your finances in check and you in control.

If you would like more information about how to avoid wasteful spending and debt, call OCCA Consumer Debt Relief to discuss a budget plan or a debt relief option.   Call us toll free 1-866-873-6222 or visit us online www.occa.ca.   We are here to help!.

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