Ways Saving Money Could Actually Cost You More


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Just like most people I like to save money. In fact, I have built my career on trying to find new and unique ways to help people spend less. But one of the things I have learned over the years is that there are actually things we do with the intention to save that can actually end up costing us more in the end.

Here are a couple of things to think twice before doing:

1) Signing Up For a Store Credit Card

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Many stores will offer their own credit cards with incentives such as an instant discount for opening a new account. Now, I like this if it’s for a large purchase and the discount can really add up. For example, we were redoing our kitchen cabinets and by opening a credit card to the home improvement store we were using, we saved over $1,000! But here is where you have to be careful because in some cases you could actually end up paying more in the end. On certain cards, if you are late on a payment you can end up paying a lot on interest and late penalties. Additionally, for cards that offer delayed and interest free billing, paying even one day late could make all of that zero interest retroactive and due! So, the bottom line is to read the fine print and to pay off the bill in plenty of time. You don’t want the fees to end up costing you more money than the savings.

2) Buying in Bulk

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Buying in bulk isn’t always the best way to save money. Often times we will buy a large amount of an item to save. But the reality is sometimes the product goes bad or expires before we can finish it, the family gets tired of eating the same item or you have no place to store the products. You can usually find really good sales at your local grocery or pharmacy stores and when combined with a coupon your savings can actually be greater than if you buy in bulk.

3) Buying the Least Expensive Model

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When you are making a purchase for something you will be using for years to come such as a mattress, it might be worth it to spring for the more expensive model. Spending a bit more to get a longer warranty or a better product is the way to go. Cutting corners may mean you will need another mattress sooner which means having to make this investment again in the near future.

4) Buying a Package

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Unless you are confident you will be able to use a service for the required period of time, you may want to think twice before prepaying for a package of services. Exercise classes are a perfect example for me. I have purchased discount classes by prepaying and ended up not liking the class! In the end, I spent a lot of money for attending just one class. The same goes for things like gym memberships. Sometimes paying a little more on a monthly basis instead of locking yourself in is the way to go.

5) Paying Investment Fees

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If you are working with an investment company I cannot stress enough how important it is to find out what you are paying in fees. I once did an in-depth review of all the fees I was paying, and found I was paying a 1% fee on my cash while they held it waiting to invest it for me! So, while paying to get advice on investing in your retirement can prove to be very helpful, know exactly what you are paying for!

6) Missing A Rebate

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A rebate can work to the consumer’s advantage but a good number of times we never follow through on getting the rebate in by the deadline. So, don’t pay more for a product because you will be getting a rebate unless you are sure you will get it in on time. Instant rebates are helpful in that often times you don’t have to do anything to get the rebate. If you do go with a rebate to save some money, make sure you save all of the original packaging. I have found myself finally getting around to sending in the rebate forms and suddenly realize I need to include the original UPC code from the box! So, in an effort to save I ended up spending more without getting the savings.

7) Buying Super Discount Airfare

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These days there are so many ways to save money on airline tickets. We have discount sites and coupon codes to help us get the best deal. But again, it is important to know what that discount gets you. I was just with my nephew who got one of the best deals I had ever heard of to go from San Francisco to South East Asia. His ticket was around $400! But the fine print included some wording that would make me feel uneasy about losing my seat. Fortunately, it worked out for him. But when it comes to travel the best price doesn’t always mean the best terms in securing you will get to your destination.

8) Cutting Corners on Insurance

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The least expensive medical plan may end up costing you more in prescriptions and care. Don’t assume a lower monthly premium will save you money if your deductible is extremely high. Consider how many times you will be using your insurance and if you need prescription medications. Consult someone from the insurance company to weigh the pros and cons to each plan. You don’t want saving some money on a monthly basis to cost you hundreds, even thousands more in the long run.

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