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5 Ways Americans Waste Money Without Noticing – The Motley Fool

Image source: Getty Images

Life is busy and it’s easy to ignore the small sums of money f…….

Image source: Getty Images

Life is busy and it’s easy to ignore the small sums of money falling from our pockets.

Key points

  • It’s easy to overspend on everyday items we actually need.
  • Take a look at your expenses for things like clothing and food to see if you might be overspending.

We are a nation of consumers. If we have money, we spend it. Unfortunately, many of us have a habit of spending money on things we don’t need. The problem is, we do need clothing, insurance, food, and housing. And because we need these things, it’s easy to overspend. The trick is to pay for what we need without going overboard.

Here are five things Americans tend to waste money on and some spots you might be able to trim your budget.

1. Fashion

According to a recent survey from the U.S. Bureau of Labor Statistics, women and girls spend an average of $545 on clothing annually. Men and boys spend around $326. However, those are averages, which means some people spend less and others spend more. And those who spend much more often chase the latest fashions.

If you’re someone who jumps on the latest fashion trend, you may be throwing money away. That’s because truly hot trends don’t last for long, and just about the time something goes out of style, you find yourself purchasing the latest trend.

A better bet for most of us is to buy classic pieces that aren’t going to look “so 2022” in 2023.

2. Insurance

Insurance is essential to our financial health. Whether it’s home, life, or auto insurance, a good policy may be all that’s standing in the way of financial ruin. Still, it’s possible to overdo it. Here are some examples where policyholders might be able to cut back.

Mortgage life insurance

It’s less popular than it once was, but some people purchase a policy that promises to pay their mortgage off if they die. It’s almost always a waste of money. Let’s say you buy a home with a balance of $300,000. The cost of a mortgage life policy worth $300,000 is typically far higher than the cost of a term life policy with the same death benefit.

Collision insurance

If you’re driving an old car with a low Blue Book value, paying for collision coverage …….


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