20 Things Poor People Foolishly Waste Money On

5. Gambling

This is seen as similar to in-app purchases for many people when it comes to looking at it in terms of wasting money. Gambling can be anything from going to the casino to buying a lottery ticket. Sure, the chance of putting a dime into a machine and getting back $50 sounds great, but what will you do once you win just a little money? You think this is your lucky day and soon you’re leaving a casino with less money than you came with.

This doesn’t mean you can’t go to the casino, but you need to make sure of two things before you go. First, you can afford to go to the casino. Just because you have money in your account doesn’t mean you can afford to spend it gambling. Second, you need to have a budget. Go to the casino with $20 and once you spend that money, get out of there.

4. The Newest Technology

In some ways, this is another way of keeping up with your friends. You want the newest and greatest technology because of all the features it gives you. On your phone, you get a better camera, thinner or bigger phone, and something that looks new and what other people want. But, if you think about it, there is very little difference from one phone to the next. Even if you have the money to pay for a new phone, it doesn’t mean you can afford it.

It is important to remember the difference between having the money in your account and being able to afford the item. When your car needs maintenance that is $800 and the new phone is priced at $800, what you can afford is to fix your car and not buy the new phone.

3. Banking

Have you ever looked at how much money you give your bank every year? This doesn’t just include the commission you pay your bank for commission and not to mention those dreaded overdraft fees. Think about it, if you average ten overdraft fees a month and each charge is $33, you are paying your bank $330 a month, and this comes to $3,960 a year. This is definitely money that is wasted just because you couldn’t keep your checkbook afloat. At the same time, it’s hard not to look at your bank and blame them because how are you to get and stay out of the hole when they are taking so much of your hard-earned money?

This doesn’t mean that you withdraw all your money from the bank and stop using them. It means that you need to take control of your finances. Look at how much you make and create a budget, so you know that you will keep your account in the positive and avoid those overdraft charges.

2. Smoking & Vaping

Not only is this harmful to you, but poor people spend more money on smoking and vaping than any other socio-economic status. In fact, it’s often the lowest socio-economic groups that spend more money on gambling and smoking when an average price for a pack of cigarettes is a little over $6, though many states are increasing the cost to up to $10 per pack.

This means that you will spend around $200 on a pack of cigarettes every month, especially if you go through a half of a pack to a whole pack every day. To put this into perspective, without inflation, the cost you spend on cigarettes every year is $2,400, and the price for ten years is $24,000. Now, take a moment to think about what you can spend that money on, such as repairs to your car or even save up for a new car or house. Of course, you could also put that money into savings for your retirement. If you want to stop smoking, there are multiple ways, such as reading a self-help book or going to the doctor.

1. Giving To The Wrong Charities

This isn’t easy to hear, but there are many well-known charities you donate your money to where the charity doesn’t see half of the money you gave. Part of this is because of the fees the system takes when they process the payment. The other part of it is some of the money goes to paying the staff instead of where you want the money to go. For instance, if you donate to a charity that helps sick children, you want the money to go to the children and not the staff.

While you can continue to donate money, it is essential to find a charity or nonprofit organization that is in your area. Then, you can walk in the doors and talk to the executive director about where your money will go, and you can see the program expanding because of your contribution. Even if you don’t feel like paying the staff’s wages is a waste of money, you always have a better feeling when you are helping the people you want to over anything else.

Sources:

“15 Things POOR People Waste Money On.” Alux, YouTube. March 2019.

“13 Ways poor people waste money but rich people don’t.” Paula R. Gorman, Ideas Ranking.