The desire or need to save money can be so great at times that we’ll try just about anything to do it. And not all of those money decisions are smart ones.
Sometimes we realize our mistakes just moments after we’ve made them. Other mistakes take us years to realize. It can be easy to fool ourselves into thinking we’re saving money when we’re not. I know because I’ve done it. Have you?
5 Ways We Fool Ourselves Into Thinking We’re Saving Money
Buying things on sale
Buying things on sale can be a money-saver if it is done with careful thought. Stocking up on products on sale that you know you will use before they expire is smart. Buying clothing you need on sale is a good idea.
But sometimes, we get caught in the trap of allowing ourselves to buy things we don’t really need because it is on sale. And that is not saving, it’s simply spending less. If I need a new winter coat because my current coat is ancient and in poor shape, finding one at an end-of-season clearance sale will save me money over buying a new coat at the start of next winter. But if I already have three perfectly nice winter coats in my closet and I buy a new coat because it’s super cute and it’s on sale, I’m not saving any money at all.
It’s easy to fall into this trap at the grocery store. We stock up on sale items only to discover they rotted in our fridge or expired in our pantry before we could eat them.
Just because an item is on sale it doesn’t mean we’re saving money if we buy it. And if the item we’re buying on sale is of poor quality, it may even end up costing us more in the long run.
There’s no interest
It sounds like a good deal: Buy new bedroom furniture and pay no interest for six months. Or check out zero percent financing for your next vehicle.
Perhaps buying those things will save you money. But they usually don’t. In the example of the furniture, you may discover that there is a pretty large payment due at the end of that six months. If you can’t afford to pay for the furniture outright, that’s a pretty good indicator that you should wait until you can afford it. Or find other ways to save on furniture.
That zero percent financing for your car may come with a 7-year-loan. And do the math. You may find that the cost of the vehicle is actually a bit higher because they’ve built the amount of interest you would have paid into the asking price. Do you really want to make payments on a vehicle for seven years?
Buying things at a particular store
The media and marketers do a great job in convincing us that certain stores have the best prices and you’ll pay more everywhere else. We think that if we only shop at stores Walmart or Costco we’ll save a ton of money, but that’s not always the case. You have to know how much the things you buy should cost, determine what a good sale price is, and then shop around. Some stores have lower prices on some things and higher on others. Shopping at one store exclusively can cost you more than if you take the time to shop around for the best prices. Plus, it keeps you from discovering new places to save money!
Skimping on (or skipping) maintenance
When money is tight, it seems a whole lot easier to look the other way when things like car maintenance or home maintenance projects crop up. We jiggle the handle on our toilet instead of fixing it. We turn up the radio instead of dealing with that noise our car is making.
And in almost every case, skimping on fixing things ends up costing you more money. It’s a lot less expensive to do the small maintenance tasks than to let them snowball into a full-blown time-sucking and expensive emergency. Deal with the loose shingles before they become a leaky roof. Fix the leaky tire before you’re stranded with a flat tire in the rain.
The same thing goes for taking care of yourself. Try to maintain an ideal weight. Try to stay active. Make sure to schedule regular dental cleanings. You’ll not only feel better, but you will save money on your medical expenses, too.
As the saying goes, an ounce of prevention is worth a pound of cure.
You save money when you do things yourself. At least that’s what you told yourself when you started your project. Now, four trips to Home Depot later and you’re still not sure you’ve figured out a solution.
Sound familiar? Sometimes you can save money by doing things yourself – particularly if it’s a project in which you have skills and knowledge. But sometimes, a little free time and a YouTube video is all it takes to create a much more expensive project than we initially planned.
It’s important to know as much as you can about the cost of materials and time you will need to invest in your project. It’s important to know what could go wrong and how that will affect your budget. Know your limitations. When you know when to pay someone to do a job and when to tackle a job yourself, you’ll do a much better job at saving money.
When it comes to saving money, it’s important to stop and think a little bit about what you’re doing. Have you crunched the numbers? Will it really save you money or will it cost more in the end?
When you you can answer those questions, you’ll no longer fool yourself into thinking you’re saving money when you’re not.