There has never been a better time to save money. Things may be looking up a bit, but our recent recession has revealed a lot about our concerns with public welfare, job security, and financial needs. Surprisingly, most Americans continue to overspend.
In an age where a penny saved is really a penny earned, we should worry more than ever about frivolous spending. But many of us are still not seeing the light. Let’s take a look at some of the top things overspenders indulge in and see if we can find a sense of reason amidst the many temptations we face each day.
Casinos can be a great way to go out and have a good time. And if you can spare a few bucks for a night at the slots or card game, then go for it. But for many people, gaming is more than just a hobby, it’s a necessity. And that’s where the fun ends.
More and more people are getting into the thrill of gambling, and more and more money is being poured into slot machines, poker tables and sports betting. According to recent studies, about 46% of American adults play in casinos, generating gambling costs in excess of $90 billion a year. And for an economy that is literally struggling to find a foothold, that’s pretty disappointing and almost tragic.
Many of our players are elderly retirees who live solely on social security, savings and pension funds. And even more are young adults with low incomes or other financial difficulties. But for so many Americans, the thrill of risk-taking or the simple escapism that gambling offers outweighs the importance of financial responsibility. Of course, like most addictions, gambling can easily lead to stress, depression, and financial ruin. Is this really what you want to spend your money on?
Bad habits and daily routines
This is one that most Americans can relate to in some way. If you were to calculate how much you spend on coffee, cigarettes, or fast food each year (for many people, all three), you might wonder why you choose to pay for it. A pack-a-day smoker spends on average between $150 and $180 in smoking expenses each month. If you eat fast food every day, you’re looking at $150-$200 a month just to feed yourself. And that daily cup of Starbucks can easily set you back $120-$150 every 30 days.
Overall, Americans spend about $150 billion on fast food, nearly $80 billion on cigarettes, and about $18 billion on coffee each year. Why? Obesity is one of the leading causes of premature death in the US, killing more than 300,000 people a year. Smoking causes more than 11 types of cancer in addition to chronic lung disease, heart and cardiovascular disease, birth defects, and infant deaths, and kills nearly half a million smokers annually. Again, is this really what you want to spend your money on?
high standards of living
Let’s be honest. Nobody wants to think of themselves as poor or low-income. But if that’s who you are, then it’s important that you budget your money accordingly. More than 13 million American families have incomes below the federal poverty level. These families often struggle to make ends meet, even if they work full time. In these types of situations, knowing where you stand financially is critical.
Many low-income families experience additional difficulties trying to keep up with the middle and upper classes. Spending on dining out, name brand products, cell phones, Internet and cable TV packages, video rentals, and other forms of entertainment will definitely make the tough times even tougher. These kinds of things may not be too much to ask, and everyone wants to provide them for their families. But if it’s about living beyond your means, then it’s time to revamp your spending policies and focus more on the necessities of life and family security than comfort.
Americans spend about $40 billion dollars a year on entertainment and simple leisure. When we are faced with such high levels of poverty, record unemployment figures and such acute economic stress, I ask you: Is this ReallyWhat do you want to spend your money on?
If the US as a whole refrained from spending money on fast food, cigarettes, coffee, gambling, and entertainment, it would save (or “earn”) about $400 billion dollars per year. At that rate, if these savings were applied to the US$13 trillion deficit, it would only take about 30 years to pay it off. That’s the typical life of a home loan. Of course, that’s not likely to happen. But if cutting waste can do so much for an entire country, think about how much you can do for yourself and your family alone.