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Episode 225 - Exposing Sneaky Financial Traps

Are you tired of feeling like your money is slowly disappearing without you even realizing it? Do you want to take control of your finances and become more money savvy? If so, you're not alone. In the latest episode of the Debt Free Dad podcast, Brad Nelson and his co-hosts dive deep into the world of sneaky expenses that could be costing you more than you think.   

 

Shining a Light on Sneaky Expenses 

In this eye-opening episode, Brad, Chris, Katie, and Ryan discuss common expenses that many people overlook but can significantly impact their financial well-being. From wasting money on lottery tickets and convenience store drinks to overspending on single-use items and falling victim to bank fees, the podcast hosts share personal anecdotes and insights that shed light on these under-the-radar financial traps.   

Real Stories, Real Solutions 

With a candid and relatable approach, the hosts share their own experiences of paying off debt, making financial mistakes, and learning valuable lessons along the way. From Ryan's revelation about overspending on cars to Katie's struggle with food waste and single-use items, each story serves as a reminder that financial awareness and discipline are key to achieving long-term financial freedom. 

Practical Tips for Financial Success 

As the episode progresses, the hosts offer practical advice and tips for listeners looking to improve their financial habits. From paying attention to the interest on debt and avoiding unnecessary bank fees to the advantages of paying in full and using cash for everyday expenses, the podcast provides actionable steps that can help individuals take charge of their finances and make smarter money decisions.  

Your Path to Financial Freedom 

Whether you're just starting your financial journey or looking to enhance your money management skills, the insights shared in this podcast episode offer a valuable roadmap to achieving financial freedom. By being mindful of your expenses, making intentional financial choices, and staying committed to your goals, you can pave the way towards a brighter and more secure financial future. 

Resources Mentioned

Get better results with your finances in 30-60 days - GUARANTEED. Watch this video to learn how! - https://www.debtfreedad.com/payoff-debt-in-60-to-90-days 

Free Tools and Downloads at www.debtfreedad.com

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Episode Transcript: 

Brad: [00:00:00] So we're getting real about those sneaky expenses that quietly nibble away at our cash. We're talking about the little money munchers. That might be costing you more than you realize. Stick with us as we shine a light on these under the radar financial traps aiming to make you more money savvy and to give you the tools to take charge.

Of your financial game. Stay tuned. You're listening to the debt free dad podcast with Brad Nelson, Brad, and his co hosts experience the anxiety of living paycheck to paycheck before learning the fundamentals of financial success. They are now on a mission to empower regular people to pay off their debt for good and enjoy happier, less stressful lives.

Keep listening for inspirational interviews, tips, tricks, and practical advice to gain financial freedom.

Hey everyone. Welcome to today's show. I am Brad Nelson, founder of the Debt Free Dad. I paid off 45, 000 of debt, have been debt free now for more [00:01:00] than 11 years outside of my mortgage, and I've helped thousands of other people save and pay off tens of millions of dollars with the work that we do here at Debt Free Dad.

Um,

Chris: been debt free now, except for our mortgage ever since 2008.

kati: And I'm Katie Hatfield and I am still working on paying off all of my debt. I have paid off over 153, 000 in debt in five and a half years on a single income.

Ryan: And I'm Ryan and I've paid off about 160, 000 over eight years and I will have been debt free, I think coming up on almost four years outside my mortgage.

Brad: Now guys, after listening to the episode today, if you want to take this a step further and you'd like to get better results with your [00:02:00] finances in as little as 30 to 60 days. We'll be sharing details about how you can do that a little bit later on in the show. So guys, today we are talking all about common expenses.

That you are quite possibly wasting money on. So out of the gate guys, is there anything that you just want to get off your chest that, you know, when we started talking about this topic, I mentioned, Hey, what, what were you guys wasting money on? Or maybe even today, what you're still maybe wasting some money on because.

A lot of people think just because maybe you're debt free or you do a budget means you're just absolutely perfect with some of this stuff. But there is still a human side to this where at times you mess up. So, um, it's time to, uh, take the skeletons out of the closet guys. Let's talk about it.

Amber: I still waste money on lottery.

Brad: Yes. I knew you were going to bring that one up.

Amber: It's entertainment. And my husband will go into the gas station and buy a drink all the time.

Brad: Paul. Really?

Amber: All the time. Yep.

Brad: Wow. Did he? Oh, no. Did [00:03:00] he keep doing that? Even try getting, well, getting out of debt?

Amber: I think he was he stopped or slowed it down. But he went back to it now that he's like, Oh, I have the money.

Brad: Now I got money. Now I go to the convenience store and pay more. Oh,

Amber: buy one, he buys a two for five, or whatever it is.

kati: I was buying bottled water and I'm like, wait a minute. There's water that comes out of my sink. And it actually tastes good. Like some people would argue that and I'm like, it just needs to be cold.

Brad: Well, now to be fair, some water out of the sink tastes like sewer.

kati: Yes. When it, when I lived in Florida, definitely, but. Not here.

Brad: And it might be worth it to buy bottled water in that case, but you know, a lot of like in a lot of your places, unless you rent, you may not be able to do this, but you know, you could easily do like a filter, you know, just a filter around your water tap too.

Amber: Wait, you just put a Brita in your fridge.

Brad: or you could do that too.

kati: Yeah, but then I have to remember to change the filter and the filter change costs money and all of the things.

Amber: That is [00:04:00] true.

Brad: And you got to remember to fill up the pitcher, right?

Ryan: I was sharing with my wife about this episode, what we were doing. And, uh, I told her that I was going to share this and she just laughed cause she thought it was pretty funny. I, to this day and in the middle of getting out of debt, I love to do home projects. I love to just build things and.

Just do stuff around the house. Two, two things that I waste money on. One is I am a. Measure once and cut twice kind of guy. I remember building a picnic table with my dad years ago. And dad is a bit, my dad is a very thorough thought person. He likes to think it through and I just start sawing and he's like, what are you doing?

I'm like, I'm building a picnic table. So I definitely waste money buying extra stuff. I do because I screw stuff up. Um, but the other thing, and this is really bad and it's going to, maybe this is an issue I got to go to the doctor about, but, um, I think I have like, Five tape measures and four levels. And like, I [00:05:00] have a lot of crap because when I build stuff, like, I'm like, where'd I put the tape measure?

But I have five of them now. So if I'm building something, I always find one, but literally to this day, like, I can't tell you probably the hundreds or thousands of dollars that I've spent over the years in like that kind of stupid stuff.

Amber: I feel like that's pretty common.

Ryan: Oh.

Chris: I've got to say that that's me, right? Ryan, you can come hang out with me. I buy tools. I've got, in fact, in my garage right now, I've got tools that I bought for Christmas that I still haven't even gotten out of the box yet. Why? Because I'm going to use them one of these days.

So this was a difficult one, Brad, when you said, you know, ways that you waste money. I don't think I waste money, even though technically I kind of do. It doesn't feel that way,

Amber: like how you just justified it in that whole sentence.

Chris: Well, yes, I did justify it in my head. It's sort of like this, Brad, you can relate to this. When you, when you start budgeting and you have an emergency fund and you start getting traction, [00:06:00] emergencies still happen.

But a lot of times you just take care of them out of your budget and you don't even dip into your emergency fund, right? And it becomes like a, it's like a speed bump. You don't, you don't define those as emergencies anymore. Even though 10 years ago, I might've defined them as an emergency. Now it's like, Oh, I need to get new tires on the car.

I've got money for that.

So when I waste money, it doesn't seem like I'm wasting money. I hope that makes sense

Ryan: It's called stupid money. That's what we call it. I, and I, and I still, and I still, to this day, I mean, we budget stupid money. I have my own stupid money and my wife has her money. She doesn't call it stupid. I think it's stupid because I don't like the stuff she spends it on and she doesn't like the stuff I spend it on.

So it's just, but it's our money and we can just do whatever we want with. And so like, I would kind of agree with you, Chris. And that's the fact that like, To some people, it might be considered a waste, but it's just money we budget and like, yeah, I buy dumb stuff with it. doing all the other right things now, but back in [00:07:00] the day when I was doing stupid stuff with my money, then I would say I was wasting it because I wasn't doing the right things with my money.

I was just like buying stupid things. And then being like, Oh, my gosh, we don't have enough money for gas in the car that's being wasteful where now it's just kind of flipped. Um, but to this day, also, like going out to eat still for me is still a crutch. I mean, we're still guilty of every once in a while.

We'll go to maybe more than once in a while. You know, we go grocery shopping, get home. I don't want to cook tonight.

Some would call that a waste. And I think we do waste money when it comes to that. Food waste is something we really still aren't great at.

Brad: Well, that's what I was going to say is food waste is huge. I think if you go to save the food. com, I think their statistic, I don't know if they've updated recently, but it's been on there for a while. I think upwards of 40 percent of all food that is. Produced in the United States gets thrown away, which is crazy.

kati: Like when I buy vegetables and I put them in the hospice drawer on the bottom of my fridge.

Brad: I can totally relate to that. You know, after, you know, being a [00:08:00] single parent now and having to cook for my kids, cause I too have been eating out a lot more this past year, just cause convenience and I don't have time a lot. And, but I do the same thing. I will, I will, you know, with good intentions, buy the produce and buy the stuff, you open up that drawer and that stuff dead.

kati: My problem was always not really going out to eat. I was always like, I don't go out to eat. I don't drink coffee. So I don't stop at Starbucks.

I don't do any of this, but I did wander the aisles of Target and that is always dangerous.

Brad: Well, let's go through this list of real quick of these are the, these are pretty common ones that people tend to forget about, you know, we often say get out of debt, but you know, what people will do is they'll total up their debt, but they'll never really look at how much interest they're paying on their debt on a monthly basis.

So one thing to easily, easily forget about is obviously if you have credit cards is you don't pay attention to how much interest that is building month after month, because you're only making minimum payments. So look at that. If you're in debt, really look at how much is it costing you to have that debt?

It is easy to [00:09:00] ignore it, but most people on their debt are spending thousands of dollars a year. On just the maintenance of that debt and having the interest on it. So make sure you're checking those things out bank fees, ATM fees and overdraft fees. This is a big one. Um, I am a big fan of using banks for free as for free as you possibly can But this is one that often gets missed, you know a two dollar fee here a five dollar fee there You're using ATMs that are maybe out of your network You know, you may not be doing your budget.

You may not be paying attention to your bank your bank account You know, this was probably back three four years ago, but I think at that time banks were making over 30 billion a year on overdraft fees, 30 billion for people to mess up their, their bank account. That's crazy. So, um, those are ones to definitely check out.

Do you guys ever have any issues with those three? Bank fees, overdraft fees,

kati: Queen of overdraft fees. Yes. I always, and I did actually track how much interest I paid [00:10:00] in 2022. It looks like I paid over 5, 000 just in interest

Brad: That's a vacation. That's like two vacations.

kati: That's a lot of vacations.

Brad: So two other ones that kind of fit together, um, that people constantly waste money on is number one, not paying cash. They rely more on even maybe sometimes a debit card or credit cards. And as we've shared on the show. Multiple times over and over again. Uh, so many studies out there that show that you're going to spend a lot more money using say a plastic or even cardless pay options versus using cash.

So make sure you're watching those things. A big one that often people miss is payment plans versus paying in full. This is really good for getting yourself out of debt when you start taking advantage of things like sinking funds. Um, I mean, there's, there's so many advantages to paying in full. Like we camp, uh, we're seasonal campers and I pay my seasonal camping fees all at once because I get a discount when you pay in full.

When my son was in Taekwondo, we would get a discount because we paid [00:11:00] in full. My insurance premiums, I pay once a year. I do it that way because when I pay in full for the year, I get a discount on top of it. So when you get better at budgeting, when your cashflow is, uh, getting better and you're able to start allocating money every single month to these particular sinking funds for these different expenses that are coming up and you can pay in full.

You can, you typically can save a lot more money than say, opting in for a payment plans.

Ryan: And even smaller ones, like paying in full subscriptions, um, you know, like we just renewed, um, one of our TV subscriptions that we have. And I mean, we save, , I think 25 percent or 30 percent by paying for a year rather than paying it monthly.

Brad: So one area guys that I definitely am a victim of probably wasting money is the single use items. I am like a paper plate kind of person.

Um, I know there's a lot of people who might be against that because it's so wasteful. Would you just do your dishes or put them in the dishwasher? Well, I don't have a dishwasher. Um, and [00:12:00] I hate, like if, especially now that it's just me, like dishes pile up like crazy. So I am a big fan of like plastic forks and plates and things that we could just throw away because it saves me time.

Now I get that it costs more money. But it also saves me time, which my time right now is way more valuable than a few pennies here on a place that like a plastic fork or a paper plate. But I got to tell you, paper plates are freaking expensive. I was at the store the other day, picking them up. I was like, Ooh, these are getting to be a lot of money.

I was like, and I'm thinking about all of that just gets thrown away. Right in the garbage. But think about that single use items, big one.

Amber: The only time that we use single use items like paper plates and stuff is when we have like a big gathering, a barbecue or something. It's, it's shocking to me that people use these on a regular basis.

Ryan: If Brad's having you over for steaks, bring your own steak knife. Otherwise you're going to be sawn. You're going to be sawn with a plastic knife.

Brad: Now, Hey, now, if we're going to have stakes, we're going to have paper plates and real [00:13:00] steak knives. All right. I do have those

Ryan: one of the other ones on here though, for me, and I mean, I, I know some of us have been guilty of this is cars in general. I wasted so much, like if I could go back, I mean, I was buying, we were buying cars. I felt like every few years there for a while, you know, um, we leased cars for a while cause we couldn't afford the car we wanted.

Brad: I think, um, right now, I mean, my suggestion, especially, I'm, I think we probably need to do an episode on this coming up is because the car market, you know, as we're recording this in early March of 2000 and 24 is, you know, All over the place, you know, they're pretty, a lot of crashes happening when it comes to the use the new car market, uh, it's coming, it's probably already happening and this whole idea that, you know, used cars are just expensive as new cars that may have been true during COVID for a little while.

Um, but it looks like that is quickly changing based on a lot of things that we're seeing on TikTok trends and. Dealerships and all the stuff that's kind of happening at auctions and things. [00:14:00] So, um, I think the best thing is just make sure you do your homework. Don't haphazardly get yourself into a car.

Uh, I mean, you really want to make sure you're, you're doing your homework, especially with the market, the way that is right now. But I'm with you, Ryan. I did the same thing. Wasted so much money on cars and vehicles through my, you know, late teens, all the way through, you know, probably 30 years old. I think I had, I think I had like 14, 13 or 14 cars in that time period.

Chris: I had a coworker a few years ago who I think he went through eight cars in one year for a variety of reasons. Like he bought a brand new car and a student in the parking lot backed into it and dented the bumper a little bit. He's like, well, I got to get rid of that car because you know, as soon as you're in an accident, all kinds of things start happening.

Brad: So if you want to pay off debt, save more money and take control of your finances and start seeing some amazing results here in just the next 30 to 60 days, all you have to do is head over to a debt free dad.

com click on the green button at the top of the page. And we're going to show you how you can get started in just a quick 15 minute video. [00:15:00] So the totally awesome Debt Freedom Planner is helping so many people make consistent progress with their finances. Whether that be building emergency funds, paying down bills, budgeting, tracking paydays, saving up for larger purchases, goal planning, and planning for those irregular yearly expenses that always seem to catch you by surprise.

Now the Debt Freedom Planner will help you take the stress out of managing your money. And if the thought is running through your mind, Hey, I just need to have a simple tool to get my finances together. This planner is perfect for you. Head over to the real debt, free dad. com. Click on the debt freedom planner in the menu at the top of the page and order your debt freedom planner.

Today.

Let's talk about that, baby. Let's talk about your money. Let's talk about all the good things, all the bad things that make me. Let's talk about that.

Amber: And that's how it means it's time for the celebrations of the [00:16:00] show. First, we have Nicolette, I finish my emergency fund.

Brad: Heck yeah, way to go, Nicola. Congratulations. Kathleen says, Had my budget done and in place before the first of the month? You all, this is the first time. Not good, I know, but I will never give up and continue to get better each and every day. With this budget stuff. Kathleen, it always starts with that first one.

Great job getting it done.

 And Kim says, my mindset is changing. I can see it. She says, I hope to stay motivated. Throughout this journey to be debt free and increase my retirement savings.

kati: And I get to do my own celebration. So, um, I paid off two credit cards and a chunk of a third with my annual bonus, which would have been way more fun to use towards something nice. But I also earned a free all expenses paid cruise by working my tail off, uh, towards the end of February

 

Ryan: Uh, and Linda, I am retired and on a fixed income. My budget always includes money for a few rounds of golf. Yesterday. I started a [00:17:00] part time job, which is one day a week at a golf course, but a little, it's a little bit of money, but it has free golf, so it's a win win.

Brad: Hey, as always, congratulations to all of you who are taking a stand for your financial life and are wanting better. Hey, we get that getting out of debt isn't easy, but with our help and with your consistency and discipline, we promise you this will be some of the best work that you do in your entire life.

We'll see you guys on next week's episode.

Thanks for listening to the debt free dad podcast. Connect with us on Facebook, TikTok, YouTube, and Instagram. Just search debt free dad. If you found value in today's episode, please leave us a rating and review. We so appreciate it. For resources, show notes, and links mentioned in today's show, visit debt free dad.

com. Catch you next week.

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