This is a guest post by David Bakke of MoneyCrashers.com.
You may know some people who spend way too much money on the newest clothes or gadgets, neglect to use coupons at the grocery stores, and pay ridiculous amounts of money for premium cable TV. I’m not one of them. In fact, I’m as frugal as they come. However, even I know that being too frugal can actually cost you more money than you’re saving in some cases. Here are seven ways it doesn’t pay to be cheap.
1. Not Going to the Doctor
Routine check-ups with your doctor and dentist will save you more money in the long run. If you get checked out once a year by your doctor, and twice a year by the dentist, you can catch problems early and treat them with far less time and money than if the problems fester. No matter how unpleasant (or costly) routine physicals and check-ups may be, they are much more pleasant than a visit to the doctor or dentist where major work or repair needs to be done.
2. Ignoring Routine Car and Home Maintenance
Consult your car owner’s manual and
perform all scheduled maintenance checks and replace parts as needed, even if you don’t think it’s necessary. Simply changing your oil, air filter, and spark plugs in a timely fashion can save you a lot of money and headache down the road.
At home, change your AC filter as needed (usually every three months) and invest the time, money, and effort into maintenance tasks like re-caulking, painting, and chimney cleaning. Your home is one of the biggest investments you’ll ever make in your life so make sure you treat it that way.
3. Buying Every Bargain You Find
It’s great to shop for sales and discounts, but remember, a bargain is only a bargain if it is for something that you’ll actually use. Believe it or not, it sometimes actually makes more sense to pay full price for an item. For example, paying full price for an outfit that your child has hand-picked himself may be much more cost-effective than getting a great deal on five different outfits that he ends up not liking and never wearing.
4. Super Frugality at the Supermarket
Cutting down on your grocery bill by looking for deals and using coupons is a great way to save money (i.e. extreme couponing) – unless of course you’re sacrificing your health. Buying 10 boxes of macaroni and cheese for $1 may seem like a deal, but all you’re buying is empty calories. Your money would be much better spent on fresh fruits and vegetables. The healthier your diet is, the fewer trips you’ll be making to the doctor in most cases.
5. Skimping on or Ignoring Insurance
Although most insurance is pricey, it’s never a good idea to go without health insurance entirely. When choosing your plan options, do not, as a general rule, go with whatever will provide you with the cheapest deductible. Review your options and choose the best deductible for your situation. If you are generally healthy and single, for example, selecting a plan with a high deductible is okay. However, if you need to provide coverage for a family with small children, go with a lower deductible. Same process with homeowners insurance and car insurance.
6. Sacrificing Quality for Price
In certain situations, there is nothing wrong with going with the cheapest price. When it comes to higher usage items, you definitely “get what you pay for.” If you’re buying a flat screen TV, for instance, you want to get one that will last a long time and offer great picture quality. This means you’ll have to spend a little bit more money. The same goes for laptop computers, home furniture, and major home appliances. In these cases, spending more can save you more since you won’t have to replace high quality items every few years.
7. DIY Overdose
I am a do-it-yourself fanatic. However, know your limitations. You may think that you can handle any project without any outside help. But hours of sweating and cursing later, you realize you’ve made a big mistake and have to hire a professional to undo the damage you’ve done, thus costing you more money than the original problem would have.
When contemplating any DIY project, park your ego at the door and make sure the job is within your realm of expertise. If not, spend the extra money and call in the pros. For example, there are some DIY car maintenance tips you may or may not be able to handle on your own.
Do you have any other instances where being too frugal can cost you money?