Seven small money mistakes that really add up

For a lot of us, money doesn’t start making itself heard until it gets nice and big. Buying a new home? You’re fully aware of how much you’re spending on what. Same goes for your other big purchases and expenditures.

Small money, however, has a tendency to slip through the cracks. We might be aware of the fact that we’re slightly overspending or wasting a little bit of money, but we don’t worry about it, because it’s such a small amount. Unfortunately, those small amounts add up over time, meaning those little bad habits can end up being quite costly indeed.

If you care about money (and I have to assume you do, since you’re reading this), then you don’t want any of yours going to waste. With that in mind, here are seven very small, very common money mistakes that add up over time.

Mistake #1: Buying small and buying often

This is basically the inverse of buying bulk. You need something, you buy a small quantity of it, and soon you have to buy some more. The fix, however, isn’t to just go ahead and buy everything in bulk. Buying in bulk isn’t always the best choice. The trick is to recognize those small purchase patterns. Maybe you go to the gym four times a week, and every time you go, you stop at the mini mart on the way and buy a bottle of Gatorade. Planning ahead and buying in greater volume in those kinds of circumstances will save you significant money over time.

Mistake #2: Choosing convenience over forethought

Building off of that first mistake, neglecting to plan ahead is a very costly habit. We’re all occasionally guilty of paying more for convenience because we just don’t feel like putting in the effort. Long day at work? Forget grocery shopping – let’s get takeout! We know that what we’re doing is splurging, but we mentally write it off as a one-time thing that we earned somehow. But every time we pick the easy way out, we cost ourselves money. The more thoroughly you plan your expenses and stick to that plan the less wasteful you’ll end up being.

Mistake #3: Failing to comparison shop

You probably don’t think of it as such, but we very often fall in love with certain products or services and find ourselves buying the same things over and over. We only revaluate when something drastic happens – the price shoots up, the quality changes significantly, etc. If we really cared about our money, however, we’d make those kinds of evaluations every time. Every purchase is another chance to potentially overspend or to save a little money. Try to train yourself to not take anything for granted. Always keep your eyes open for alternatives.

Mistake #4: Not making saving money a priority

Building your savings should not be optional. It shouldn’t be an if-then proposition, where you only set aside money when the circumstances are just right, because very often the circumstances won’t be just right. You need to make contributions to your savings a mandatory expense item and not an option. It needs to live in the budget and happen regularly. You need to be constantly building your emergency savings and your retirement savings. Does your employer offer matching funds on your 401K? Take advantage of that.

Mistake #5: Forgetting what you already have

Here’s something I’m completely guilty of: buying things you already have. This also ties in with planning (or not planning, as it were). We own things, never use them, forget we have them, and then when we do need them, we waste money on new versions. This also applies to your food budget and the perishables we let go to waste because we forgot we even had them. Slow down your purchasing and really think about what you have, what you need, and what you’re planning to do. Thinking things through rarely hurts when it comes to your money.

Mistake #6: Being reactive instead of proactive

Do you know people who prefer to go to the emergency room rather than make an appointment with their doctor? Those people cost themselves a lot of money by refusing to address their issues before they become catastrophes. Being proactive means being willing to spend smartly to prevent small issues from becoming major issues. It’s about investing in your immediate future. When money is tight, people are less likely to spend proactively, and more likely to ignore the ignorable problems. Fight that instinct.

Mistake #7: Forgetting that everything costs money

Ever fall asleep with the TV on? Ever get lost while driving because you thought you could just figure it out? Ever space out in the shower or come home to an ice cold house because you accidentally set the air conditioning too low? Things like that happen all the time and they don’t seem like much, but they all cost you money. We make a lot of little, spur-of-the-moment choices every day and forget to connect those choices to their cost. It adds up. So if you feel yourself drifting off in front of the TV, remember that by not taking a second to grab the remote and kill the power, you’re making a purchase of a sort. You’re spending money. Just remember that and let that influence your choices.

Jesse Campbell is the Content Manager at MMI, focused on creating and delivering valuable educational materials that help families through everyday and extraordinary financial challenges.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.