Money Wasting, Money Wasting

If you haven't taken the time to keep a detailed account of your daily expenditures for a month (or a week at least) you really should do it as it may really open up your eyes to where all that money goes that you supposedly receive from those twice-monthly cheques. And as I'm sure you're well aware, it's not the monthly rent, car payment, cell phone bill, etc. that get ya (although they certainly do their part), it's the little things that really add up to suck the savings out from under you.

It's been called many things but most notably in recent years it's been trademarked as The Latte Factor by David Bach author of many best-selling financial literacy books. I would highly recommend you read at least one, my wife and I read Smart Couples Finish Rich. The title sounds rather petty and materialistic but one of the foundations of his financial planning approach is to view your choices based on your values.

Today I read an article outlining what various 'normal' expenditures can add up to including unused memberships, interest on credit cards, and daily lunches out during the work week. Here's a couple examples (Note figures are based on U.S. prices... add 20% for CDN):

1. Coffee -- According to the National Coffee Association, the average price for brewed coffee is $1.38. There are roughly 260 weekdays per year, so buying one coffee every weekday morning costs almost $360 per year.

4. Bottled water from convenience stores -- A 20-ounce bottle of Aquafina bottled water costs about $1. One bottle of water per day costs $365 per year. It costs the environment plenty, too.

5. Manicures -- The Day Spa Magazine Price Survey of 2004 found that the average cost of a manicure is $20.53. A weekly manicure sets you back about $1,068 per year.

7. Weekday lunches out -- $9 will generally cover a decent lunch most work days. If you buy rather than pack a lunch five days a week for one year, you shell out about $2,350 a year.

9. Interest charges on credit card bills -- According to a survey released at the end of May 2007, the median amount of credit card debt carried by Americans is $6,600. Rate tables on Bankrate.com indicate that fixed interest rates on a standard card average 13.44 percent. Making the minimum payment each month, it will take 250 months (almost 21 years) to pay off the debt and cost $4,868 in interest. Ouch!

The rest of the Top 10 Money Drains.