Tuesday, March 25, 2008

How Much Money Do You Lose Through Laziness?

It all adds up: a couple dollars on this bill; a few dollars not earned on that savings. We lose money through laziness.

This is really coming to mind to me tonight because I'm preparing my documents for my appointment with my tax preparer tomorrow. Early last year, I didn't have a plan for text messaging...and at my pre-plan peak, I spent over $20 in one month, on text messages alone. After a few months, I switched to a $4.99 plan.

I have a couple savings accounts at WaMu. I know they now have some deal on a higher rate interest savings account, but I've not taken the time to pursue this. Granted, most of my cash savings is with Ing, so it's mostly making more money anyway. (Though consider this: my Ing savings accounts earned well over $200 last year (far more than what my Ing IRA earned, but let's not get me started on that...), and my WaMu accounts....a whopping $5.21.) I consider this the cost of my having super-immediately accessible emergency money, instead of having to wait a few days for an Ing transfer.

That's a bit tangential, but really: how much do you lose simply by not asking for whatever is more beneficial to you? This is a similar idea to what I wrote about in my post A Clogged Drain and Living by Default. Just like it's possible to "earn" money by asking for lower rates on credit cards, it's just as possible to review what you regularly use and find better deals. When we don't do this, we're paying a laziness tax and that money goes straight to people/companies/banks who would let you have that money if you only asked. I'm sure I'm not the only one who has paid too much in the past, or is losing money by not having switched my savings accounts to the ones with better a better rate.

If we consciously spend our money smartly in the grocery store, how come we don't do the same for other things we regularly use?


Fabulously Broke said...

That is so true. The littlest amounts add up and before you know it, you've saved $150

Anonymous said...

So true, Stopping the little money loses during a recession is even more important then normal growth times because money is tighter. Money Leaks can easily ruin a budget

Nadine said...

Beware, however. Better returns on your savings usually mean increased risk, and you might find yourself losing out in the end, if not all the money is there when you need it.

I've been through difficult times moneywise, and I find that availability, especially with a solo business, is important too. In my country, defaulting on some payments like income tax, social security, etc., entails a 10% fine from day 1. If my clients are taking it easy and not paying me on time, I may end up losing a lot more than the few euros I could have earned on less flexible investment.