21 Things Broke People Waste Money On

Summary

In this video, the creator highlights 21 common money-wasting habits that can keep people broke, offering practical advice on how to avoid them. From impulse purchases and eating out to excessive credit card interest and unnecessary subscriptions, the video covers a range of topics that drain finances. The key takeaway is to prioritize long-term financial goals over short-term indulgences, stressing the importance of budgeting, avoiding debt, and being mindful of spending. With a mix of humor and actionable tips, the video encourages viewers to make smarter financial choices to build wealth and avoid financial pitfalls.

Takeaways

• 😀 Impulse purchases add up quickly, costing the average American nearly $2,000 a year. Avoid making purchases that aren't aligned with your financial goals.
• 😀 Eating out is a major expense, with the average American spending around $3,600 annually. Meal prepping at home can help save money and support financial goals.
• 😀 Paying credit card interest means you're spending more than the original price of your purchases. Avoid paying interest by paying off credit cards in full and on time.
• 😀 Microtransactions in games may seem small but can quickly add up, draining your bank account. Be mindful of digital purchases that add no tangible value to your life.
• 😀 Overpaying for insurance or purchasing unnecessary coverage is a waste of money. Shop around with independent brokers to find the best deals and coverage for your needs.
• 😀 Expensive car purchases and car loans lock you into long-term debt. Wealthy individuals prioritize financial goals over impressing others with flashy cars.
• 😀 Small indulgences, like expensive lattes or snacks, can add up and hinder your ability to save. Treat yourself in moderation, but prioritize your financial future.
• 😀 Designer clothing offers no real return on investment and can be a significant drain on finances. Focus on saving for long-term goals instead of spending excessively on fashion.
• 😀 Designer baby clothes are unnecessary and often end up covered in food or dirt. Instead of splurging, save for your child's future education or other important needs.
• 😀 Unused subscriptions (e.g., Netflix, Spotify) are quietly siphoning money from your account each month. Regularly review and cancel subscriptions you no longer use.
• 😀 High phone plans and financing phones are costly and unnecessary. Look for more affordable alternatives to save money, and pay off your phone in full to avoid ongoing debt.

Q & A

What is the main idea of the video script?

The video highlights 21 common money-wasting habits that people often engage in, particularly those struggling financially, with the aim to help viewers recognize and avoid these habits in order to improve their financial situation.

How much money do Americans waste annually on impulse purchases?

Americans waste nearly $2,000 a year on impulse purchases, which can significantly hinder long-term financial goals like saving or paying off debt.

What are some common examples of impulse purchases mentioned in the script?

Examples of impulse purchases include snacks, limited edition items, and unnecessary gadgets, often found while waiting in line at checkout or browsing online.

Why is eating out considered a money-wasting habit?

Eating out is costly, with the average American spending around $3,600 a year on dining out. The script suggests that meal prepping and cooking at home are more cost-effective alternatives that align better with financial goals.

What advice is given about credit card interest?

The script warns that paying credit card interest means you're spending money on something you bought months ago, instead of building your financial future. It encourages viewers to avoid carrying balances to prevent losing money on interest.

How can microtransactions in games lead to financial waste?

Microtransactions, like buying virtual items or in-game currency, may seem small but can add up quickly. Players can end up spending a significant amount of money on digital extras that provide no tangible benefit.

What is the recommended approach to insurance to avoid wasting money?

To avoid overpaying for insurance, the script suggests working with an independent broker to shop around for the best coverage at the best price, and to eliminate unnecessary policies.

Why should people avoid buying expensive, new cars?

The script argues that buying new, expensive cars locks individuals into high monthly payments and depreciates in value the moment the car is driven off the lot. Wealthy individuals often drive used, reliable cars to avoid this financial trap.

What is the problem with designer clothing and baby items?

Spending excessively on designer clothing and baby items is a waste because these purchases do not contribute to long-term financial security. The script suggests focusing on savings, investments, and practical purchases instead.

What is the issue with financing phones and paying for extended warranties?

Financing phones is described as a form of debt disguised as a purchase, and extended warranties are often a money grab that most people will never use. Instead of paying for these, individuals should focus on paying for phones upfront and building an emergency fund.