SPEAKER_00 0:07

Welcome to Money Talk for Real, a podcast where I talk about making money, spending money, and everything in between. I'm Nick, and in this episode, I'm gonna talk about some things that broke people always seem to waste money on. Let's jump in. Number one, the biggest one is credit card interest. Now, I'm gonna get to some other things on this list that discuss, you know, what they spent on the credit card. But what I'm talking about here specifically is the interest on the credit card. You're paying off the balance. So you're paying back the money that you borrowed that you owe to the credit card company, but you're wasting money also on the interest. And these credit card companies don't build stadiums and skyscrapers in major cities off of pennies. Those cost a lot of money and you're paying for it. You're paying the interest on these. If you have 15%, 20%, 23% credit card interest, that is wasted money. You're paying for and you're paying that interest and you have nothing to show for it. Stay away from credit cards if you can help it. It's a very slippery slope. And, you know, it's not just the credit card companies, but it's a lot of businesses now have their own credit cards, right? And they're gonna charge you interest as well. So be careful with credit card interest. Um, the next thing is lunches out. This is absolutely wasted money, especially if you're doing it habitually or at least regularly. You maybe didn't plan correctly. If you planned correctly, maybe woke up 20 minutes earlier, you could, you know, um spend less money, but also just have more time by making your food at home. Lunch is out, you're paying the markup because that restaurant has their cost of food, which you would pay as well if you got it from the grocery store, but also they need to make a profit. So they have their cost of the food, they have their labor cost, they have their overhead cost for the establishment or the building that they're renting or that they own or that you know that they're operating in. And then they have profit on top of that. You're paying all the additional stuff. Whereas if you were to buy the food and make it yourself, you're not wasting money because the only thing you're paying for at that point is the materials, which is the food. That's only one aspect of what the restaurant is charging you for. Hand in hand with that would be drive-throughs. This is wasted money as well. It's the same concept as the restaurant. Again, maybe a little bit of laziness. I get it that we're all in a hurry. We're all living busy lives, but it doesn't take, you know, everybody has a day off, right? I don't care how hard you're working, where you're working, what hours you're working. You may be working 90 hours a week, but you still have a day off at some point, or you still have some time off at some point. You have time to plan your um your food where you don't have to drive through, do a drive-through all the time. Um, the fourth issue that broke people tend to waste money on, and this unfortunately is a little bit targeted at those who are broke, is car issues that get neglected. It's the mindset of, well, I'm saving money right now, so I'm not gonna fix my alternator or whatever it is. I'm making something up on my car because I'm saving money and that's not a priority. My car still runs, so let me just ignore it. So you ignore that, and then the alternator caused the battery to go dead. And so now you're paying for an alternator and a battery. So you're you're wasting money, quote, by not spending the money to fix your dang car. And that none of this is meant to be a personal attack or to pick on people. These are just things that I see broke people wasting money on. If there's an issue with your car, that needs to move up the priority list. And I'm not saying go crazy and upgrade your car and make it luxurious with decorations and trinkets, but if it's an engine issue, a transmission issue, tires, whatever it is, absolutely spend the money on that stuff. You need a reliable car to get you to and from work. Next is alcohol. Now I'm a little bit biased here because I, for the sake of the conversation, don't drink alcohol. I will maybe four times a year max. I really don't drink, but alcohol is wasted money because it is very expensive. And some people say, well, it's not wasted. That's what helps me have fun. I get that. Um, but you can absolutely have fun without it. And I know that's a cliche saying, but it's very possible. And then the biggest thing with alcohol to waste money is spending money at bars. Similar to my restaurant and eating out example, if you do want to drink alcohol, buy it from the liquor store. Don't buy it at a bar. You all know this. If you frequent bars, you're overpaying for drinks. It does not cost $22 for an old-fashioned. Okay. You can make that yourself at home. Um the bars, similar to the restaurant, have establishment overhead. They have to pay rent and the light bill. They have bartenders they have to pay. They have mus, you know, live music, maybe. They have a lot of overhead. And they're gonna charge you for that accordingly. And more specifically with a bar, they don't have food to make money on. Yeah, they have bar food, but they don't have gourmet dishes like a restaurant would. So they have to mark up their drinks even more to account for making money on the drinks, right? So you're getting double screwed, doubly screwed at a bar buying alcohol. Next, I would say what I see some broke people wasting money on is lottery tickets. And this is unfortunate because if you're broke, you're you're go into a little bit of a panic mode. You're scrambling for money, so to speak. And when you do that, you think you see the light at the end of the tunnel by the max prize that's listed on the front of the lottery ticket. You're chasing the get rich quick, right? You have the mentality that, well, it only takes one hit and I can be a millionaire. Well, read the back of the ticket at your odds to win the jackpot. Most lotteries, at least in the state that I live in, are one in four chance of winning. But the fine print is that's one in four chance of winning something, not one in four chance of winning the jackpot. So, for example, if you buy a $20 ticket, you could win by winning one dollar. That's one in four shot of winning something. Even though you just lost 19, you won one dollar, right? So you're um, and again, this is a broke person mentality because they're they're in scramble mode, they're chasing the money. They think, oh, one dollar I could win a hundred thousand, right? You could, yes, and people do, but those people are far few and in between. Next is hand in hand with the lottery tickets. Again, it's gambling, it is sports betting. This has become very popular recently because a lot of states have made it legal to do, or even if it's not legal to do, a lot of people have found loopholes where they think they're getting away with it for now. Um, and yeah, you honestly might even win some, right? You might bet a hundred dollars, or even let's just back it down. You might bet $10 and win $12. So then you hit it again. You might bet 12 and win 14, and you think, man, I'm on a roll. And then you go all out and you bet 30 and you lose all of it. Okay, so it's a slippery slope. All gambling is, of course. Um, but sports betting is a big one that has that one hit mentality. It only takes one hit, and I could, you know, make a ton of money. That's that's a broke person mentality. The next thing is new phones. Um I don't have much to say about this. I don't fully understand it. I do sort of, and I've talked before in other ep in previous episodes about, you know, the treat yourself mentality, the reward mentality, the comfort spending. People think I deserve this. They think, oh, well, you know, life's tough. I don't have a lot of money, but I just got a tax return. Let me get a new phone. Or they convince themselves that they need a new phone. I think you want a new phone. And you could argue with me and say, well, my phone's running slow. I need a new phone. Well, you don't need a new phone. You want it to not run slow. If it can still get on the internet, still do your banking apps, still make phone calls and texts, then it's doing what it needs to do, just not as fast as you would like. So maybe practicing a little patience would be the answer. And I don't mean to be gaslighting or condescending by saying that, but um, new phones, I absolutely see people wasting money on. If you want a new ER phone or a new to you phone, maybe that's going to be a better option to get one used, get one secondhand at a fraction of the cost than just buying a new phone. And I see a lot of people that get can that get roped in, get convinced to buying the new phones because it's hidden. The cost of the phone is hidden in your monthly phone bill, it's hidden in the two-year contract. You think, okay, well, I don't have to spend $2,000 on an iPhone right now. I can just pay $49.99 a month and I'll have a new iPhone. Well, that's great, but in some ways, it's much like a car. That $2,000 phone next September or next fall, when Apple releases the new one, your phone is now no longer worth $1,000 or $2,000, right? The value goes down. The next thing people waste money on are drinks or candy or just gas station items, the buy and take with you. It's a convenience, it's a comfort thing. It's like, oh, I'm already here. I might as well go buy a Gatorade. And, you know, a lot of these things, when I say that people are wasting money, are not necessarily wasting a ton of money. A lot of them can be fractional cost, right? A Gatorade's $2 or $3. But if you stop by the gas station two times a day to get a Gatorade, you, you know, after a week, you're better off to just go to a grocery store and buy a pack or a case of Gatorade at a fraction of the cost. And again, we're talking $2 a Gatorade, not a huge deal. But when you compound Gatorade with candy, with lottery tickets, with um new font, you know, everything at the end of the year, how much money did you spend? How much money could you have invested and had it grow and make you more money? Um, one-time purchases in low quantity, I have on my list here because a lot of times, again, it's a similar mindset to the car issues getting neglected. People think, okay, well, I'm gonna go cheap. I'm just gonna buy this one thing to save money. That's great. But if it's stuff that you legitimately need and you are gonna legitimately use and it has a long shelf life, shelf life meaning the amount of time before something goes bad, if that amount of time is a long time, you may be better off to spend more to buy something in bulk. For example, and then I'm making up numbers here, I'm making this uh example up toothpaste or deodorant or razors if you're a guy or maybe or a girl, but um you know you're gonna use all that stuff. You might buy a tube of toothpaste for five dollars, or you can buy a case of twenty tubes of toothpaste for eighty dollars, and you think, oh, I'm gonna buy the five dollar because eighty dollars is a lot of money right now. Yeah, but if you buy it for $80, you're saving $20. You, you know, you're saving $20 over the course of the life of those toothpaste, and then you only have to buy a case a year, or however long, you know, however long toothpaste last you. Like, um, so sometimes spending more for things in bulk can save you money. And and I would not do this, you know, it needs to be legitimate needs, legitimate necessities, things that you actually are going to use. Um, an example could be toilet paper, paper towels, dish detergent, laundry detergent, uh, again, personal hygiene type stuff, um, contact solution, that sort of thing. But buying in bulk can save you money, but just do your due diligence, make sure it's an actually a good deal. There are some online marketplaces and even in-store, you know, uh brick and mortar stores that will make it look like it's a good deal. They'll scratch out the original price and make you think you're getting a heck of a deal, and it's no different in price. And if it's not a difference in price, then my whole concept of buying in bulk is invalid, right? It needs to be a savings for you to justify buying it in bulk. Um the next thing is so so that's kind of talking about low quantity. Um next, I want to talk about low quality because it is cheap. And if you're saving money, you're going to go the cheapest route because you think, well, I'm I'm saving money, I'm getting this on a deal. I'm I'm not, you know, it's not costing me that much to get this. But the problem with something being cheap, as I talked about in the last episode, is it breaks quick and it costs you more in the long run because you're replacing it more. If you buy something cheap, you might have to replace that item three times. Whereas if you would have paid double the cost, it would last you as long or longer than buying something three times, right? So if you buy something three times versus double the cost to a higher quality item, you're better off to pay double and get it lasting longer than paying three times for replacing it three times. So low quality is something I see broke people wasting money on. The last thing, and this is probably the biggest thing because it encompasses a lot. This is the biggest thing I see broke people wasting money on is looking rich. And the keyword is looking rich, appearing to have money, but they don't. They're broke. They are living, they're one paycheck away from losing it all, but they're trying to look rich because they're living the comparison lifestyle. They're buying jewelry, they're buying watches, they're buying shoes, vehicles, sunglasses, handbags, purses, etc. I could go on forever. Things that just look rich because it's a name brand designer item. And people associate those items with having money, having wealth. And you might have a designer handbag, but you have no money. You're broke. You just look like you have money. You're wasting your own money. You're doing it for the impressions of other people, even though you're the one that will suffer financially and run your bank account dry. That's my list for things that broke people waste money on. Leave a comment if you're able to. Definitely leave a five star review on this podcast, and I will catch you on the next episode. Thanks for listening. This is Money Talk for Real.