Getting suckered into buy-one-get-one (BOGO) deals
BOGO, when it’s genuine, is hard to resist. but even then, whether it’s BOGO free or BOGO half price, you have to stop and ask yourself, Would I really have bought this much of this item at this price anyway? If you’re shopping for jam and see BOGO free on jam, that’s probably a great time to stock up. But if you’re looking for a new pair of sneakers and see BOGO half off, stop and think. You went out looking to spend $60 on sneakers. Now you’re spending about $100 after taxes. Did you even want two pairs? Will you wear them both? Do you even like the second pair? Put down the pricy shoes and try these creative ways to save money you never thought of.
Building an emergency fund but not contributing to a retirement plan
It’s essential these days to have an emergency fund. Financial experts say you need six months’ to one year’s worth of expenses. But experts also agree that you need to look after your financial future. If you’re squirreling money away into an emergency fund or savings account but not putting money into a 401(k), IRA or other long-term plan, you’re not preparing for something you know is coming: old age. And with compound interest being what it is, every day you put it off is dollars wasted. If your employer has a 401(k) match, that’s additional money you are throwing away. When it comes to saving, the simpler, the better. And what could be simpler than “The $5 Savings Plan,” i.e. stashing every $5 bill that comes your way? It’s a surprisingly effective way to put some money aside. A Boston Globe writer who stuck with the plan saved $12,000 in three years. That’s a lot of Lincolns. Avoid these other 12 mistakes people make early in retirement. (Source: lifehacker.com, mommysavers.com)