I have a friend – let’s call her Gabby – who is exceptionally bad with money.
She was out shopping one day, and she literally did not have the $15 she needed to pay for her parking. It turned into a big drama, which ultimately ended with her being banned from parking her car at the shopping centre ever again by security.
As she was telling me this story, I could feel myself getting panicked. How does something like that even happen?
I then sat down with her and practically forced her to tell me how much she spends each day and what she spends it on, and then I came up with a financial plan for her to follow.
It turned out she was spending over three quarters more than what she earned each month on things that were completely unnecessary.
That’s an extreme case, but the reality is we can all be a little bit more mindful of where our money is going on a day-to-day basis. All of those little extras add up.
“Too many adults do not have an accurate view of their income and expenses,” financial advisor Bily Xiao told Forbes.
“But if you measure it, you can improve it. So start tracking, take stock of how much you’re saving, identify low-hanging fruit of expenses you can cut, and start setting some incremental goals to increase your saving.”
Here are five of the biggest things you’re wasting your money on every day…
Caffeine is one of the great gifts of modern life.
But if you’re guilty of buying cups of coffee every day, well, you’re not doing your bank balance any favours.
Two cups of coffee will easily set you back between $8 to $10 every day. Multiple that by five, and you’re spending $50 a week on caffeine.
If you’re an avid coffee drinker, it might be worth investing in your own espresso machine and a thermos.
Yes, it might be a little expensive, but it’s a one-off purchase that will end up saving you tons of money in the long run.
Think of buying lunch as a treat, not something you do every day.