At a recent event I had the opportunity to learn more about the bill organizing website and had the chance to listen to Farnoosh Torabi, personal finance expert and Manilla's financial editor, who discussed some of the biggest culprits of wasted money for consumers as well as some solutions on how to save money. These timely tips are particularly important for parents, especially since money wasters like unused cell phone plans, ATM fees and late credit card feeds really add up that can lead to major financial mistakes and debt. As I learned more about money wasters, I also learned how to set goals, establish a strong financial foundation and save money with some simple changes. Here are some of Farnoosh's tips:
5 of the Biggest Money Wasters:
- Late credit card fees. Late fees and penalties account for over 22 billion dollars in charges.
- Unused cells phone plans. Most people have more texts, minutes and data plans than they need. In fact, on average a person spends over $330 a year on unused minutes and texts, according to BillShrink.com, a cost-savings website.
- High ATM fees. On average it will cost you about $2.33 every time you withdraw cash from an ATM that doesn't belong to your bank. Banks also charge fees of about $1.41 every time you use a bank outside of their network, which can add up to about $400 a year if you use ATMs twice a week.
- Gift cards and daily deal sites. These sites cater to impulse spending where over $8 billion dollars go wasted from unused gift cards and daily deal sites like Living Social and Groupon.
- Public transportation: In metro areas, like NYC, commuters are throwing away up to $52 million dollars on lost or unused Metrocards. Consider buying a monthly card or using services like EasyPayMetrocard.com where money is deducted from your debit card when funds reach a certain amount.
5 Tips to Save Money:
- Pay your bills on time and online. This method is safe and it makes it easier to avoid late fees, which are horrible for your credit score. Farnoosh suggests, 'If you have to make a choice about which bills to pay, start with your credit card with the highest interest rate first. Pay far more than the minimum. For the other cards, pay partially or at least the minimum.' Another good way to pay bills on time is to automate and schedule payments online.
- Watch for expiration dates. Daily deal sites can be great but if you don't use you are not losing out on a cool deal but you are throwing away money. Farnoosh suggests to keep the deals in your purse and to only buy a deal that is within 5 blocks from your home or work place. She also suggested that consumers should create reminders for the coupons and value cards so you don't lose out on the value.
- Tweak your cell plan. With so many unused minutes eating away costs, Farnoosh suggested that consumers join a 'friends and family' plan which can include anyone that also uses the same cell provider as you. Generally, people that are in your network can be called for free, which won't eat up your minutes or cause your bill to skyrocket.
- Never pay an ATM fee again. To avoid ATM fees, Farnoosh suggested that you always use your bank's ATM. She stated that there are free applications from numerous banks that can show you were several branches are when you are out and about. She also said that apps like My Mobile Allpoint can help you find surcharge-free ATMs. Another way to save on these fees is to opt for cash back anytime that option is available. Using this service you wont have to deal with any fees. However, the limits are generally lower than at most ATMs.
- Cash-In or Swap Unwanted Gift Cards/Deal Vouchers. Since these daily deal sites thrive on impulse spending you may regret a purchase a few days later. If you don't want to use them you can actually swap them or sell them on sites like SwapAGift.com, PlasticJungle.com, DealsGoRound and CoupRecoup.
To learn more about Farnoosh, please visit: http://www.farnoosh.tv/
MomTrends was not paid for this post. I was given a gift bag at this event.