11 Silent Budget Killers You Don't Notice
Do you feel like you're constantly going over budget, but can't figure out why? You might be victim to silent budget killers — those small expenses that you don't consider "expenses," or perhaps you've forgotten about altogether. Here's a reminder of some sneaky, money-sucking line items that you might want to flag and eliminate in order to put a few more bucks back in your wallet. (See also: 13 Dumb Little Purchases You Need to Stop Making Today)
1. Underused Gym Memberships
I'm a regular gym-goer these days, but for years I just had memberships — very expensive memberships, in fact — to facilities that I would visit three, maybe four times a month. I would let them go, because I kept telling myself that I would start going more frequently "starting this month." But "this month" turned into next month and, well, you know the drill. If this sounds like your situation, cancel the membership — or at least very least put it on hold (but consider that this will also incur a fee) — until you've re-committed yourself to an active and healthy exercise regimen.
2. Online Subscriptions
Memberships to online subscription sites can run the gamut from professional social networks like LinkedIn, to entertainment sites like Amazon or Netflix. The problem with these sites is that they always sound good in theory (in that moment when you impulsively signed up because maybe you needed it right then), but now that the need is gone, you're not engaging in them as much.
"I see this more with business owners, but it can affect non-business owners as well," says Amanda Abella, savings advisor at MoneySavingPro.com. "Have you really taken any of those business/health/etc. courses you're paying for? Have you really watched all of those videos you pay for?"
If the answer is no, log in and opt out.
3. Music Streaming Services
Honestly, the whole idea of music-streaming services makes me shake my head. Have we all forgotten that the radio is free? Do you really need to hear those obscure songs by WhoKnowsWho right this second? Is it worth the fee you're paying for a commercial-free experience? And are you using it enough to justify the cost? The latter is the most important question, I suppose. If you're getting your money's worth, then okay. If not, it's just a waste.
4. Irregular, But Necessary Life Expenses
"Non-regular but necessary expenses like car tags and renewing dental insurance — they always seem to sneak up on you, and then you're surprised when they roll around because you didn't budget for them," Abella points out.
There's not much you can do about these expenses, so it's good to have at least a little cushion in your monthly budget to cover these surprises.
5. Currency Exchange Fees
I'll admit that I'm not terribly familiar with currency exchange fees, but you may be if you travel often or own a small business that operates internationally. Alon Rajic, managing director of MoneyTransferComparison, explains more in detail how currency fees could be taking more from you than you should be paying.
"If you're an expatriate, an immigrant, a small business owner, or an overseas investor, currency exchange fees are undoubtedly a silent budget killer for you," he says. "Even fairly financially savvy individuals often check the direct cross-border transfer costs (ranging between $15 and $50 in the USA), instead of focusing on what really matters: exchange rate markups. These markups (the difference between real interbank rate and buy/sell rates) can amount to 3%, 4%, and even 5% of the lump sum exchanged into foreign currency. For anyone transferring money regularly between different currencies, or investing a significant portion of his money in foreign investments, FX fees could very well be the biggest factor affecting personal finances."
6. Surprise Expenses for Your Child
Every parent knows that children always need something, and that something is not always in the budget. This especially becomes a budgeting nuisance for separated or divorced parents who use a child-support system to pay for their children's expenses.
"A silent budget killer for separated and divorced parents usually arrives in the form of surprise expenses falling outside the monthly base support payment they exchange, such as an impromptu dentist visit, class field trip, or friend's birthday party," says Sheri Atwood, a child support and multi-household finance expert at SupportPay.com. "These little expenses pile up against the extracurricular activities parents are also expected to pay for, but still don't fall under the monthly child support payments, like gymnastics class, baseball gear, and more."
7. Extra Fuel for Your Car
Gas is much more affordable at the moment than it has been in the past, but it's still not "cheap." It's also one of those commodities that we can't really live without, and an expense that easily can send your budget overboard depending on how much extra driving you do — for instance, at the holidays for shopping or playing taxi for the kids. Try to look ahead at any out-of-the-norm driving you'll need to do over the next couple weeks to lessen the impact of falling short elsewhere.
8. Leaving Stuff Running at Home While You're Not There
Electronics plugged in or on when they're not in use, lights on when nobody's home, heat or A/C running when it's not being used — these are all major money suckers. We're talking potentially hundreds of dollars in misused gas and electric if you're not mindful. To ensure your energy budget stays on track, or perhaps even declines, think about investing in more efficient sources, like LED lights and "green" appliances, and obviously turn off what's not in use right after you're done using it.
9. Automated Payments
You may have automated payments scheduled for items you don't use or no longer need — like those gym or online memberships — and because they're automated (which essentially equates to "out of sight, out of mind"), you're letting them slide every month. Stop doing that. Review your automated payments to make sure that everything is a necessary expense. If not, dump it.
There's also a chance that you could be charged incorrectly with automated payments if you're not careful. SavingFreak.com's Paul Moyer explains.
"Any service where the price can change and you have an automatic payment is a potential silent budget killer," he says. "Two of the biggest examples are insurance and cable television. With these two services, they will slowly raise your rates until you turn around and find out you are overpaying by 20%-30% without even realizing it."
Provided that eye-opening information, perhaps it's worth investigating your automated payments to make sure everything is on the up-and-up.
10. Auto-Renewals for Membership Sites
One of my biggest pet peeves about membership sites is their auto-renewal policies, many of which require you to return in a certain amount of days to cancel the service — especially if you're taking advantage of a promo — or else you're charged a premium.
The other scenario is that auto-renewal occurs a year later — which, granted, is generally preceded by an email warning — but if you miss it or you're just not expecting it, it can throw your budget out of whack in a flash. As a general rule, I steer clear of auto-renewal options so I don't have to deal with the hassle. Plus, you might not even be interested in whatever it is you're subscribing to a year later, which also is something to consider before signing up long-term.
11. Online Price Discrimination
Did you know that you may be paying more for virtually everything you're buying online based on your location? It's true, and Karen Mesoznik, inbound marketing manager for SaferVPN, claims that you can keep your budget in the black by being just a little more Internet savvy.
"One silent budget killer many people don't notice is online price discrimination," she reveals. "When you browse online, your IP address is your unique identifier, revealing your geo-location. What many online consumers don't realize is that airlines, rental car services, software providers and streaming subscriptions charge different prices according to the information they receive from an IP address. Price discrimination can be avoided by using a VPN (Virtual Private Network) to change your IP address to match that of another country where the cost of services is lower. For instance, booking a flight from Brazil could cost hundreds of dollars less than booking it from the U.S."
What are some of the silent budget killers that you've noticed lately? I'd love to hear a few of yours in the comments below.
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