Expenses Destroying Your Budget

Budget your monthly expenses.

Overspending is often the result of a series of small purchases rather than one big one. As inflation causes prices for nondiscretionary items like food, housing and energy to rise, families may need to reduce their expenses in other areas to make ends meet. Consider cutting these 13 reoccurring expenses to keep your budget on track.

Streaming services

If you’re subscribed to Netflix, Spotify and HBO Max, for example, you’re spending at least $339.75 on streaming services each year — $119.88 on Netflix, $119.88 on Spotify and $99.99 on HBO Max. That’s a good chunk of change each year. Try a subscription cleanse by canceling all of your reoccurring subscriptions and only adding back those you truly miss after a few weeks. “A lot of expenses that creep up on us involve apps and internet shopping and subscriptions,” says Kimberlee Davis, partner and managing director at The Bahnsen Group. “Those things eat away if you have a $10 subscription on an app you don’t even remember signing up for.”

Delivery memberships

On top of streaming services, you may also be subscribed to delivery services like Amazon Prime — which announced on Feb. 3 that its Prime subscription would increase to $139 a year. You may also be subscribed to book of the month, floral or meal kit delivery services. Again, keep those you use and can comfortably afford.

Credit card interest payments

Spending beyond your budget tends to snowball when credit cards get involved. “Nine times out of 10, you’re going to pay for that on a credit card, adding up to more credit card debt,” Davis says. “The very next step after budgeting is paying down your credit card debt.” With interest rates beyond 20%, credit card debt has a way of eating up the wiggle room in your budget. Many experts suggest tackling credit card debt first before other, less expensive debt.

Data storage

It might cost just a dollar or two, but when prices in the grocery store and at the gas pump look the way they do today, every dollar counts. Check on data storage subscriptions through services like iCloud and Google Drive to be sure you actually need the items you’re paying to store.

Your cable bill

Paying for cable and streaming services? Consider cutting the one you use least. There are many cable alternatives that may do less harm to your budget, as cable services tend to advertise one price, only to tack on additional fees to ultimately charge customers a different, much higher price. Review your cable bill and alternatives if it’s too expensive.

Unneeded insurance

You may be paying for more insurance than you need, particularly if you haven’t taken a look at your policy coverage in a few years or if your life circumstances have changed. Retirees, for example, may no longer have a need for life insurance or disability insurance.

Pricey gym memberships and exercise classes

Some gym memberships can cost hundreds of dollars a year and even virtual exercise classes can be pricey — a Peloton app membership costs $155.88 a year, for example. Take the time to see if these expenses truly fit into your budget and match your priorities. “If you budget, it will allow you to get through good times and bad times without the whole house of cards falling apart,” Davis says. “A budget is equivalent to self care. If you don’t have a budget, you are putting yourself into a situation where money is controlling you and circumstance is controlling you.”

Costly gifts

A novice budgeter might forget to include seasonal expenses, like gifts, in his or her annual budget. Between holidays, birthdays and weddings, the line item for gifts can start to really add up. “Giving in to impulse purchases (i.e., purchasing lunch when you already packed one), comparing yourself to others, especially on social media, and not being honest with yourself/spouse about your spending habits can attribute to hurting your financial health,” Rob M. Hayworth, certified financial planner and partner at Summit Financial Group, wrote in an email. Consider creating a budget for irregular items and unplanned discretionary spending to give yourself some flexibility.

Cigarettes and vape products

If you smoke or vape, you’re not just taking on a monetary cost to your budget each month. Studies show smokers tend to earn less at their jobs than nonsmokers and the cost of insurance, like health insurance, long-term care insurance and life insurance, is often higher for smokers than nonsmokers.

Your pricey cellphone plan

Cellphone plan options are always changing. Review the latest options and your current data usage to see if you can take advantage of a smaller data plan or a family saving plan. You may be able to negotiate your plan’s cost as well if you’ve been a long-term customer or are considering switching carriers.

Takeout and restaurants

Takeout and restaurant meals can add up after taxes and tip are added to the bill, while cooking at home is almost always the cheaper option. Eating out gets even more pricey when you’re having those meals delivered. Postmates, for example, charges a delivery fee of anywhere from $5.99 to $9.99 depending on the merchant.

Financial fees and commissions

Review the fees you’re paying to financial advisors, robo advisors, cryptocurrency exchanges, brokerage firms and other financial services. Some services are well worth the nominal fee, but these fees can also add up quickly or go completely unnoticed if you’re not careful. Know exactly what you pay your advisor and talk to advisors with different fee structures to find the one that fits into your budget.

Full-priced items

If your budget is tight, it may be time to take advantage of sale racks, consignment shops and online thrifting options. You might find some good gems by using online clothing sites like ThredUp and DePop, or you could keep an eye out for store brand items, coupons and deals when grocery shopping.

Cut these costs from your budget:

— Streaming services.

— Delivery memberships.

— Credit card interest payments.

— Data storage.

— Your cable bill.

— Unneeded insurance.

— Pricey gym memberships and exercise classes.

— Costly gifts.

— Cigarettes and vape products.

— Your pricey cellphone plan.

— Takeout and restaurants.

— Financial fees and commissions.

— Full-priced items.

More from U.S. News

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Understand Inflation Before It’s Too Late

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Expenses Destroying Your Budget originally appeared on usnews.com

Update 03/31/22: This story was published at an earlier date and has been updated with new information.

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