Small Daily Habits That Slowly Drain Your Bank Account

Like me, you probably already cut out the biggest sources of waste in your budget. These are the easy ones—low-hanging fruit, so to speak. In this stage of optimizing your finances, a little bit of effort goes a long way.

But the problem with most smart, competent people is that they stop too soon. They make a few changes in their life, see the gains, and then get a little complacent. I know that’s what I’ve done in the past, and I have to keep re-motivating myself to care again.

One of the best ways to reignite that desire to save money is to recognize all the ways in which you’re still being wasteful. If you care about financial independence, that should bother you.

In this article, I’m going to hit you with all my best ideas for what to cut out. These are the small, daily habits that still slowly drain your bank account and keep you from reaching your biggest financial goals.

Buying name brand groceries

Most grocery stores that I’ve been in, including the one my wife and I shop at every week, have an in-house brand of products that are much cheaper than name brand versions. In almost every case, you’re getting a similar product with just slightly different packaging. Over time, this swap can make a meaningful dent in your grocery bill without any sacrifice in quality.

Taking your kids to restaurants

It’s no secret that eating out will cost you more than at home. But let’s be honest—taking a handful of kids to any restaurant setting is not very relaxing. Why not eat at home with food you love, and then take those same kids to a nearby park. If you pack a nice tasty dessert, you’ll essentially be recreating the restaurant experience, but at a fraction of the cost.

Checking social media in your free time

Few people realize the true cost of social media. The apps are free, but they soak up one of your most valuable, and non-renewable resources—your time. In the past, I’ve found myself mindlessly scrolling the feed when what I really wanted was to wind down a bit and relax. The key takeaway is that social media isn’t really filling the need you have, and actually displacing time from better pursuits like reading, listening to music, or talking with a friend. The opportunity cost here is considerable.

Buying all your clothes new

When I was younger, I associated thrift store clothes with being poor and a little less fashionable. But I’ve come to see that this is a huge mistake. Thrift stores have many clothes that are barely used and super affordable. At this point, I actually enjoy the treasure hunt experience of finding a deal at a thrift store. There are quite a few things I refuse to pay retail for anymore.

Carrying a balance on your credit card

This is one of those lessons I had to learn the hard way. There was a period of time I was carrying a balance on my credit card, and making only the minimum payments. While I felt like I was preserving cash flow, what I was really doing was throwing money away. Credit card interest is one of the highest rates you’ll pay anywhere, so pay off your balance in full each month.

Buying excess insurance

Not all insurance is a good deal. For accepted policies like home, car, and healthcare insurance this is a no brainer. You buy those policies to protect against catastrophic losses. But what about phone insurance, travel insurance, or extended warranties on what you buy? In most cases, the expected payouts on these policies are much, much less than what you’re paying. My advice is to insure against what you can’t afford to lose, and self-insure for everything else.

Keeping your home too warm in the winter

A family friend who grew up in the rural south often told me this saying she heard growing up: “People don’t burn money, but they do burn firewood.” It was a reminder to keep the house cool and not to be wasteful. In my own home, we keep the thermostat down and dress warmly in the winter. Our oil furnace is one of the biggest expenses in our budget, and it’s a simple way to save money, while living comfortably.

Keeping the lights on in rooms you’re not using

Having lights on in your home is a no-frills way to feel like a millionaire. I’m only being a little bit serious. When a home is filled with natural light it gives a sense of abundance that is pleasurable. But of course, this comes at the expense of energy usage, and therefore money. I’ve realized that there’s a simple solution: use smart wi-fi lights that can be set to fill your space with natural light, but only be on when you are home.

Paying for subscriptions you don’t use

We currently live in a subscription economy, and there are pros and cons to this. On one hand, it spreads out the cost of goods and services so that they feel more affordable. But this has a downside too, which is that you probably aren’t being intentional enough about what you’re subscribing to. A few bucks here and there doesn’t seem like much a month, but it can really add up. I recommend regularly reviewing your bank statements and canceling anything you don’t use a lot, or truly appreciate.

Driving in ways that lower your fuel efficiency

Gas is the largest day-to-day expense in our transportation budget, and that’s true for most people, even with an electric vehicle. I’m not an expert here, but there are a few things you can do that will certainly help. First, keep your tires inflated properly. Underinflation is bad for fuel economy. Second, drive with a light touch on the pedals. The more aggressively you accelerate the more gas you’re using, and the same is true with braking quickly. Just take it easy, and your savings will add up.

Having out of control portion sizes

I am aware that eating is a rather personal subject, and so I will tread lightly here. But I think many of us have an opportunity to save money by reigning in our portion sizes. This isn’t true for everyone, but in many cases, the long term benefits of eating more reasonably, in terms of both finances and health, is something you should consider. As with all big changes, don’t try to go too fast with this one.