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Today there has been a paradigm shift in Americas spending habits. We are definitely watching our money more closely, But, many are still making mistakes that don’t seem like it is costing us much money but over time it can add up to lot of wasted money.
Here is a list of some mistakes we make everyday:

1. Buying expensive mutual funds: Do you know how much you pay for the mutual funds in your retirement account? If you don’t know, you’re not alone. Mutual fund companies don’t send out monthly or quarterly bills. Instead, they quietly deduct their fees from the returns on your investments. These fees, quoted as an expense ratio (a 1 percent fee means you are paying 1 percent of your account balance in fees each year), add up to thousands of dollars over a lifetime of investing. To see just how much you are paying, use a free service such as Morningstar.com to track the actual expense of your mutual funds and ETFs. You can track your portfolio for free on Morningstar, including the total cost of your investments.

2. Neglecting credit scores: Credit scores have a major impact on our financial lives. An excellent credit score results in lower interest rates on mortgages, car loans, and credit cards. It also results in lower insurance premiums. But many do not know their credit score or how their financial decisions shape their score. The first step is to regularly review your credit report, which is available for free from annualcreditreport.com. You can get your report from each of the three major credit bureaus for free once a year. Checking each report for errors can not only improve your credit score, but also help guard against identity theft..

3. Equating monthly payments with affordability: Far too many of us decide whether we can afford something based on whether we can manage the monthly payment. This is particularly true for homes, cars, and furniture. But just because we can handle a payment does not mean we can truly afford something. Monthly payments also ignore the true cost of ownership. A car, for example, costs a lot more than the monthly payment when you consider insurance, gas, repairs and maintenance. Instead of focusing on the monthly payment, separate needs from wants and evaluate how you might better use the money. If you still have consumer debt, for example, consider paying the debt off before buying something that will commit you to future monthly payments for potentially years to come.

4. Overpaying on a mortgage: Reducing a mortgage by even 1 percent can result in substantial savings. Whether because of falling mortgage rates, which are at historic lows, or an improved credit score, many may be able to save thousands of dollars over the life of their home loan by refinancing. Yet for various reasons, many have not taken advantage of falling rates. Even if you have a low rate now, to see if you can do better. In some cases, a savings of just 1% or less can justify the cost of refinancing. If you are able to make the monthly mortgage payments you should consider a Mortgage Acceleration System like the Pay it Off System at www.teampayitoff.com Using this powerful software system you can pay off your mortgage and debts in the shortest time possible, saving 10’s and even 100’s of thousands of dollars in interest payments, without refinancing your mortgage, your mortgage payment stays the same and there is little change to your monthly budget.

5. Missing good deals online: Thanks to the Internet, you can find deals, coupons and promo codes on just about anything. And many retailers offer additional discounts if you buy online. From cell phones to home improvement, the savings can be substantial, and shopping online is often far more convenient than driving around town and waiting in lines. The problem is that we often make purchases completely unaware that these deals exist. To find these deals, search online for coupons before you make significant purchases and bookmark coupon sites such as Retailmenot.com and Fatwallet.com, which regularly update the latest offers from popular retailers. Another way to save big bucks is to check out www.myacn.com they are the largest seller of telecommunications services in the world and can lower your local, long distance bills, internet bills, satellite TV bills, home security bills which can add up to many hundreds per year.

6. Overpaying taxes: A big tax refund can be a source of much needed cash each year. But a tax refund is the result of having too much tax withheld from your paycheck, which gives the government an interest free loan with your money. Instead of letting the government hold on to your money for up to a year, adjust your withholdings so you can pocket your money now. The goal should be to match your withholdings as close as possible to your tax liability.

7. Making minimum payments on credit cards: Even low interest rate cards charge a high interest rate. As a result, making the minimum payment on credit card debt will add a lot of interest to your total payments over the life of that debt. Making just the minimum payment also extends the time it takes to pay of the debt by many years. Rather than making just the minimum payment, commit to paying more than the minimum, even if by just a few dollars. Allocate some or all of your next raise to your credit card payments, and reexamine your budget in an effort to increase the payment as much as possible.

Wayne Isaksen – Team Pay it Off