George Kamel - 21 Things Broke People Waste Money On

Episode Date: November 8, 2024

💵 Start your free budget today. Download the EveryDollar app!  If there were an award for the cutest, most pointless purchase, I’d have to go with: baby Vans shoes. In this episode, find out 21 things broke people waste money on so you can avoid those sneaky traps.  Next Steps:  🎥 Watch my video How I Went From Broke to Millionaire in Under 10 Years.  💰 Find out if you’re protected with the Coverage Checkup.  Connect With Our Sponsors:  🔒 Get 20% off when you join DeleteMe.  💸 Learn more about opening a high-yield savings account with Laurel Road.  📱 Visit Tello for more details.  Explore More From Ramsey Network:  🎙️ The Ramsey Show    🍸 Smart Money Happy Hour  💸 The Ramsey Show Highlights  🧠 The Dr. John Delony Show  💡 The Rachel Cruze Show  💼 The Ken Coleman Show  📈 EntreLeadership    Ramsey Solutions Privacy Policy Learn more about your ad choices. Visit megaphone.fm/adchoices

Today we're breaking down 21 things broke people waste money on so you can avoid them. Now see if you can like and subscribe before I get started. Too late. Number one. You missed your chance. Just kidding. You can still click it. I'll wait. Just kidding. We're getting started. First thing that broke people waste money on, impulse purchases. We've all been there. You're in line.

Suddenly that pack of double mint or those limited edition pumpkin candies find their way into your cart. No big deal, right? Roe. But here's the thing. Impulse purchases add up fast. In fact, Americans waste almost $2,000 a year on them. A few bucks here, a few bucks there, here, a buck, there a buck, everywhere. A buck, buck, old McDonald had a farm, but now he's bankrupt. EI. EI.O.

Think about it this way. Every impulse purchase is robbing your future self. Even a mere $6 a day in impulse buys becomes over $2,000 a year that you could have put toward your financial goals, like crushing debt or building your emergency fund. So next time you're tempted by one of these impulse purchases, ask yourself, is this worth delaying my financial goals? I hope the answer is no. Number two, eating out. I get it. Meal prepping is not glamorous,

and it's easier to fire up the old door dash for a two-piece battered cod clams trips and some hush puppies. But here's the kicker. The average American drops around $3,600 a year on eating out. You're just helping all long john silver make some long john gold.

You can't keep getting away with it! Now your money should reflect your priorities. And if you're prioritizing, saving 20 minutes in the effort it takes to put on pants over reaching your money goals, I would encourage you to do some self-reflection and work on the pants thing. It shouldn't take that long.

I'm the only one in this town that can wear tight pants. You got it? Now, prepping meals may take a little extra effort. But you know what else takes effort? Working an extra decade to make up for your poor spending habits. Number three, paying credit card interest. This is one of the most common things that broke people waste money on. Paying for something you bought months ago and paying more for it

is like running a race where the finish line keeps moving further away, thanks to 22% APR. That $30 vegan pistachio candle you bought on sale, what's now costing you $40, thanks to interest. And by the way, pistachios are naturally vegan. Okay, you don't have to say it. It's redundant. You see, every dollar you pay in interest is a dollar spent paying for the past instead of building for the future.

And you've got to choose whether you're going to pay interest or earn it. And I hope you choose wisely. Number four, in-app and in-game purchases, aka micro-transactions. Oh, it's just $2,000 for this Fortnite skin or just $5 from some bonus coins? Well, these micro transactions might seem harmless, but they are designed to be sneaky and addictive. Suddenly, you spent $75 bucks on digital extras for a game because you couldn't decide if you wanted to look like Peely or Miaocells. And obviously, Peely is the right choice here.

Banana! Oh, and not to mention that it adds zero tangible benefit to your life. These little money leaks are an easy trap to fall into. So before you click buy, remember, games should be fun, not a drain on your bank account. Number five, crappy insurance. Paying way too much for insurance or paying for insurance you don't need, that's a waste of money. And the worst part is, it's actually really easy to get exactly the coverage you need, for the best price. You've got to work with an independent insurance broker, and they can help you

shop around to the top companies. If you want help with this, I'll drop a link below to a free five-minute quiz to make sure you know what insurance to add, tweak, or drop. Number six, buying expensive cars. This is the telltale sign of being fake rich and real broke. Okay, rolling up in your cyber truck might make you feel like you've made it, but what you've really done is locked yourself into a massive monthly payment for the next six years of your life. Not to mention, the second you drive that new car off the lot, the car's value drops faster than 10, Tesla stock when Elon tweets pretty much anything. And here's the truth.

Actual millionaires drive used, reliable cars. They know that buying used and reliable instead of new is the better money move. So if you want to build wealth, stop impressing people with your car payment and start driving something you own, not something that owns you. Sick burn! Number seven, little treats. I mean, who doesn't love a little treat? You've been good all week, you've worked hard, and so you decide to reward yourself with that

pumpkin spice latte or that pint of cherry Garcia. Let's be real. Small indulgences here and there aren't. evil, but there's a difference between an occasional indulgence and a bad habit. It's about being disciplined, so you can enjoy and chase after the Ameri-Cone dream and not wind up broke. Number eight, designer clothing. Now, we all love a fresh fit, but dropping 300 bucks on Air Jordan's 7J2K Philberts or 500 bucks on a Gucci belt definitely is not getting you any ROI. Now, sure, you might feel cool for a minute, but that logo is not going to pay for your CPAP in retirement. So if you're

spending more on clothes than on your financial goals, it's time to reassess your life choices. And that goes for you babies out there, too, if you're watching, because number nine is the or baby clothes. Listen, your baby doesn't care if they're wearing burberry or something from Target. It's just going to end up covered in yogurt melts and poop either way. So instead of shelling out cash for designer baby gear, focus on saving for things that will actually matter. Like, I don't know, they're college fund. No more broke babies bundled in bamboo bodysuits, and that's enough bees for one day. I'm done. Number 10, expensive phone plans. Get this. The average monthly phone plan is $141, according to JD Power and his associates. And that is associate

to the JD Power. Get it right, Bucco. But what if I told you, you could save 83 on your phone plan by switching to Tello. Well, that's not rhetorical. It's not theoretical. You can. Tello's Unlimited Everything plan is just 25 bucks. And you didn't hear it from me, but they have amazing coverage thanks to piggybacking on T-Mobile's Incredible Network. And they've got plans as low as five bucks if Grandma doesn't need all those minutes. Plus there's no contracts, you can upgrade, downgrade whenever you want. And you can get five bucks off your first month of Unlimited Everything by going to tello.com slash George

or by clicking the link in the description below. Oh, and here's a bonus money waster, financing your freaking phone. Okay, that is debt in a terrible discussion. I know a fake mustache when I see one. And as long as you have a phone payment attached to that phone plan, you are in a tiny cellular prison. That's how they get you. If you're financing a phone, then you got got.

Pay in full. Number 11, banking fees. Overdraft fees, maintenance fees, minimum balance fees, the banks love their fees. Why would you pay more money to use your money? Stop it. It's time to switch to using a high-yield savings account like the one offered by Laurel Road,

another sponsor of today's video. With their savings account, you can earn over 4% APY, with no minimum balance, minimum deposit and no stupid monthly maintenance fees. Basically, it's one of the easiest ways to make your money work for you. Let your savings grow while you sleep. To get started, go to Laurelroad.com slash George or click the link below. That's Laurelroad.com slash George.

Number 12. Vices. If it's behind the counter at a gas station, it's a horrible money suck. I'm talking cigarettes, vape pens, zen pouches, you name it. That $8 pack of smokes, that's almost $3,000 a year. Vaping on average, over $1,000 a year. Not to mention the intangible cost of looking like a fool. Easy choice. Live longer. Have more money. Bada bina bada boom. Number 13, extended warranties. Now, these sound like a good idea, but they're really just a cash grab. Companies make big bucks

selling these, knowing most people will never use them. Think about it. Why does your $30 toaster need protection? Instead of wasting money on warranties, just build up your emergency fund. That way, you're prepared for any unexpected expenses without throwing cash at something you statistically will never use. Speaking of things that go unused, number 14, unused subscriptions. Now, we've all signed up for a free trial, forgot to cancel, and now Netflix, Hulu, Spotify, and that random meditation app you downloaded, are quietly siphoning 50 bucks or more each month from your account. The average person has 12 subscriptions and pays $219 a month.

So it's safe to say, if you can't even name all your subscriptions by heart, it's time to do a clean sweep and unsubscribe. Number 15, cable TV. Now, with cable, you're paying $100 or more for 500 channels, but you only ever watch three. And let's be real, it's mostly Lil John wants to do what on HDTV. Holy cat. Oh, don't forget the commercials, because who doesn't love paying to still watch ads?

Cut the court. Grab a couple of streaming services, maybe a digital antenna, and pocket the extra $60 to $100 you save every month. Number 16, car leasing and car payments. Whether it's a car loan or a car lease, don't do it. Leasing might seem appealing because you get a brand new shiny car. You get lower payments, but it's a trap. You're just renting a car you'll never own,

and when the lease is up, you're left with nothing. Plus, sneaky fees for extra mileage and wear and tear. And by having a car payment, you're actively saying, I don't want to be wealthy. I'd rather look wealthy, but stay broke. And here's what broke people ask. How much down? How much a month?

Wealthy people ask, how much? That's it. They're concerned about the full price, and if they can afford it now. Number 17, unused gym memberships. Now, I can hear my wife rolling her eyes all the way from here, as I say this, but I'm preaching to the choir. If you're paying $100 or more for a fancy gym membership

and only showing up in January, it's time to rethink your fitness plan. Plus, if you still want the gym experience, you can downgrade to a budget, budget-friendly option like a $10 a month, Jim. You don't need expensive juice bars and eucalyptus towels to get in shape, although those are nice amenities. And in case you didn't know, walking and jogging in your neighborhood,

still free last time I checked. Number 18, sports betting. Now this one has been in your face, thanks to the ads from a thousand sports betting apps that are trying to get you to get in the game. But here's the deal. The house always wins, and the odds are stacked against you. The majority of sports betters lose money over time.

Now, sure, you might hit a lucky streak once in a while, but most of the time, you're just handing your hard-earned over to the bookies. And while we're at it, number 19, lottery tickets, another form of gambling. Now, there's a better chance of getting hit by lightning while riding a unicycle than winning that powerball jackpot. That 80 bucks a month you spend on tickets is not funding your millionaire dream, it's funding someone else's.

Think about it. Instead of scratching those tickets, if you invested that thousand bucks a year, it could turn into almost 700,000 over 40 years thanks to compound growth. So you don't have to retire broke, you've got a choice. The lottery is not only a form of gambling, it's also a tax on the poor, because lower-income communities disproportionately spend more income on lottery tickets hoping for a life-changing win. So here's the deal. Wealthy people don't buy scratch tickets or play Kina or Powerball. You will never become wealthy by wasting your time or money on these things.

Number 20, expensive dates. We all have a good date night, but do you really need to drop $25 bucks on a cocktail that tastes like lavender or $10 bucks on stale overpriced popcorn at the movies? Fancy does not always mean better. Especially if you're working to get ahead, try a picnic in the park or a homemade dinner with some candles. Remember, thoughtful beats expensive, every time. And lastly, number 21, peak prices for airline tickets and hotels. Now, booking travel last minute during peak season, congrats. You just pay double for the same flight the person next you got at half the price. So here's a pro tip. Plan ahead, be flexible and do your research. Oh, and if you can travel during the off season, you can keep your cash where it belongs in your pocket.

Money, money, money in my pocket. There you go. As it turns out, simple things like self-control and having a plan make a huge difference. Again, you're not doomed to being broke forever. You'll know I didn't say, don't ever have nice things, don't do anything fun. All I want is for you to be intentional about your goals and where you want to be financially. And that way, you create the margin you need to break free from broke. See how I did there? I know it's possible because I did it. I went from broke to millionaire in 10 years, and you can do this too.

And here's a little secret. It didn't have anything to do with having a perfect credit score or racking up points on my credit card. So if you want to know how I did it, keep watching this video to find out or click the link in the description below. Thanks for watching. We'll see you next time.