BEING rich requires money but it’s also about making smart decisions when it comes to managing your finances.
Many of us are spending money on things that don’t bring real value – like meal deals, brand-name basics, or car financing, warn experts.
Don’t end up with an empty wallet by wasting your cash[/caption]
The result? Higher debt, less freedom, and finding it impossible to build up your savings and pensions.
We spoke to money experts and financial coaches to pinpoint the items YOU need to stop wasting money on to help make yourself richer.
1. Getting the beers in
We all want to avoid awkwardness at a bar or restaurant, but regularly paying for things you can’t afford can quickly drain your finances.
But research from HotUKDeals found almost one in three people admit to paying more than their fair share just to avoid seeming tight.
The pressure to look generous, especially among friends or colleagues, means many people end up paying for rounds that aren’t returned or splitting the bill evenly when you only had soup and others ordered steak.
Vix Leyton, consumer expert at Thinkmoney, said: “For the affluent, there is no risk of people perceiving you as struggling if you don’t ’stand your round’ but keeping up with the fictional Joneses could be costing you an unnecessary small fortune.
“If you can’t quite bring yourself to do it for you, be the person that someone else around the table might need.
“You never know how much people have, particularly when we are all desperate to keep up appearances.”
2. Buy dupes instead of big name brands – and save £100s
Loyalty to your favourite food or beauty brand might feel harmless, but it can cost you a fortune.
Many branded items have nearly identical own-brand or budget alternatives that cost far less.
For instance, cooking staples like tomatoes and spices can be a lot cheaper from the world food aisle, and supermarket white rice often tastes the same as the branded equivalent.
The savings from switching even a handful of items could make a noticeable difference to your weekly shop.
Leyton said: “Buying Heinz because you always buy Heinz? Experiment with downshifting and look beyond your usual aisles.
“Get to know your local Aldi and Lidls, who often have very credible dupes in the health and beauty aisle.
“Not all of it will be on par, but flexing where you can means more budget for the dealbreakers you won’t flex on.”
3. Snazzy wheels you can’t afford
Paying for a new car via dealership finance can leave you significantly out of pocket in the long run.
Many dealers rely on finance packages for profit, not the car sale itself, and the interest rates on these deals can be far higher than people realise and what looks like a manageable monthly payment may hide thousands in added interest over time.
Fleur Iannazzo, associate partner at Aon, explained: “The monthly payments might seem affordable, but often the interest rates charged are in the double digits, 12 to 18%, which is significantly higher than a personal loan.
“What’s more, depending on the type of finance you are offered, you may not even own the car at the end of the financing period.”
4. Paying full price – and it’s not just VIPs that can get discounts
Many shoppers still treat full price as the default, but in today’s world of discount codes, cashback apps and supermarket loyalty prices, there’s almost always a way to save.
Failing to look for a discount first is one of the simplest and most avoidable financial mistakes.
In many cases, a 30-second search or a signup to a newsletter could slash pounds off your total.
Leyton said: “Shake off your internal perceived stigma for hunting down a good deal.
“Paying full price doesn’t show you’re affluent, and there are no benefits to that. A quick google… can shave decent money off shelf price.”
5. Yellow sticker ‘bargains’ you don’t need
Supermarket discount stickers can feel irresistible, especially when you think you’re getting something for a fraction of the cost.
However, if you’re buying items you wouldn’t have picked up otherwise, or food you don’t end up eating, those bargains are actually costing you money.
Psychologically, bright discount stickers make us feel like we’re winning, even when we’re not.
Leyton warned: “Deals don’t always represent the best price, don’t be beguiled by big yellow stickers.
“Make sure you check the unit price on the shelf and compare it to its rivals. Also, look below your eyeline.”
6. Treat yourself – but within reason
Buying your lunch or coffee on the go might feel like a small, everyday cost, but over a year, it can seriously dent your finances.
It’s not just the cost of the meal itself, but the missed opportunity to put that money to better use.
Making food, drinks and snacks at home, even just a couple of days a week, adds up to huge savings.
Louise Dale, financial coach at Aon, shared her personal experience: “I’m someone who likes to have that extra 15 minutes sleep each day. So, I didn’t want to spend my time making lunch – grabbing a cheap meal-deal on the way to work each day.
“It was economical, nothing that would break the bank.
“But I realised that if I kept doing this, over the course of the year I would have spent over £1,000 on soggy sandwiches.
“I would much prefer to spend that money spending quality time with my family.
“Just that thought alone helped me change the habit and now I get up 15 minutes earlier to make my lunch.”