Is convenience hurting your wallet?

Is convenience hurting your wallet?

Yes, we all want convenience.  We all work, have families, a household , and we all want to do it all, but there is never enough time.  Convenience saves time and that’s of huge importance to us all.  But look at it from the wallet side – convenience can cost more money.

Can you have convenience cheaply? If you’re willing to plan, yes! Here are a few examples:

Pizza night: Who doesn’t like to have pizza delivered to the house. But, how about a store-bought cheese pizza at $5.00 that you bake at home versus a delivery pizza at $10 (plus the cost of delivery and a tip).

Fruit and Vegetables: Pre cut fruits and vegetables are more costly than the actual item. If you don’t like to cut them up yourself, choose fruits and vegetables that are easy to eat without cutting.

ATM machines: I know many people who take out $20 today to buy lunch and then another $20 tomorrow when they are at the store again.  If you are using an ATM that isn’t free this all adds up.  How about planning for the week and making one withdrawal at your bank’s machine. That way there are no ATM charges.

Books, music and DVD’s: Convenient to buy, rent and/or download for a small fee.  But, did you know that you can borrow these from your local library at no cost?

All these little amounts add up.  This could be the difference between having a savings account versus living paycheck to paycheck.

Trust me – you need to see where all the little money is going and start to make conscious choices about whether to spend your money or not.  Convenience saves you time but it might be costing you more in the long run.

Free Checking Accounts May Not Be Free

Question: Is my free checking really free?  If so, how does the bank make money?

Great question.  Yes, there are free checking accounts as long as you meet the banks requirements.  These are typically a minimum balance in the account, direct deposit to the account or a certain number of debit card transactions.  It’s your responsibility to know what you can and can’t do according to your banks requirements so that you avoid these fees.

Banks make their money on the fees they charge their customers.  The checking account can be free, but the other optional costs are not.  These optional costs can include overdraft fees for either writing a check and/or using your debit card for more money than you have in your account, uncollected fees for using the money in your account before the deposited funds are available to use, stopping payment on a check that you have written, purchasing bank checks (money orders, certified checks) or using an ATM from a different bank.  All these fees add up.

There still could be more fees. If your transaction is not honored, then the person or company you did the transaction with incurs fees that they may charge you too.  That ATM that you used from the different bank may change you a fee as well.  The most cost effective way to save your money, is to keep accurate records (checkbook records with a ledger or software) so that you know how much money is in your account at all times and to never run short on cash so that you have to use the most convenient ATM and incur a fee. A little planning on your part can save you money.