You might be losing money without realizing it, and we're not talking about spare change that slips out of your pocket. You could be parting with big bucks unnecessarily.
From spending too much on expenses to failing to grow your wealth over time, there are plenty of ways in which money can slip through your fingers. If you want to improve your financial circumstances and keep more of your paycheck, avoid these common places to lose money.
The first place where people tend to lose money is in their family or personal budgets, said Nathan J. Bachrach, CEO of financial planning firm Simply Money Advisors in Cincinnati.
"It's because we don't pay attention," he said.
The majority of Americans do not have a budget or keep close track of their spending, according to the National Foundation for Credit Counseling's 2017 Consumer Financial Literacy Survey. If people took the time to do this, they would not waste as much money, Bachrach said.
If you have avoided creating a budget because it feels restrictive, create a spending plan instead. Rather than look for things you can cut, figure out where you want your money to go — such as paying off debt, taking a vacation, saving for a house or retirement — and review your spending patterns to see if they are in line with those priorities. You can set up automatic transfers to ensure your money is going toward your goals each month. And ask yourself before every purchase whether it's taking you toward or away from your goals.
If your tax withholding is too high, you might be losing money in your paycheck. According to IRS data, about 74 percent of taxpayers received a refund in 2017, and the average amount was $2,769. That means taxpayers let Uncle Sam hang on to too much of their hard-earned money during the year.
"The government says you have to pay taxes, but nowhere does it say you have to overpay taxes," Bachrach said.
Lower your withholding so you can get more money in your paycheck. Then, have that amount automatically deposited into your 401k or an IRA, so that it can earn interest and grow, Bachrach said.
File a new W-4 form with your employer to claim additional allowances and ensure that less tax is withheld. The IRS website has a withholding calculator you can use to figure out how many allowances to claim.
3. Services You’re Not Using
Chances are you're losing money by paying for services or subscriptions you're not using or could live without. "I recently realized that I was still paying for a cable channel package that was for a channel I never watched or even knew existed," said Slickdeals savings expert Regina Conway. "It was a promotional package when I first signed up for my cable service, and I let my bill go unchecked for months after the promotional rate had ended."
Review your bills, bank and credit card statements to see if there are any services you're paying for but don't need. Then cancel those services.
"Simply by making a quick call to the cable company, I'm saving $15 a month off of what I was paying," Conway said.
4. Gym Memberships
The average monthly cost of a gym membership is $58, but 67 percent of people with memberships never use them, according to Statistic Brain. If you're in that group, it's time to ditch your membership and stop throwing away money. Instead, take advantage of free and lower-cost ways to exercise.
"Even if you can't get out early in the day to enjoy the outdoors, tap into Hulu, Amazon or Apple TV for yoga and other home workouts," Conway said. "It's a good way to lose the dead weight of the gym membership." There also are several free fitness apps to replace your gym membership, such as Sworkit and Workout Trainer.
Even if you do use your membership, don't waste money paying for periods when you can't get to the gym. "If you're going on vacation, make sure to check with your gym about putting a temporary hold on your membership," Conway said. "Many gyms offer this benefit, and it means you won't pay for wasted weeks while you're out of town."
5. Mail-in Rebates
Consumers often miss out on serious savings by failing to mail in rebates for discounts, said consumer and money-saving expert Andrea Woroch. If you buy something because the retailer or manufacturer is offering money back through a rebate, take the necessary steps to actually get your money.
"Make sure to keep your receipt and the packaging for products that require rebates and complete and mail the rebate immediately," Woroch said. "If you regularly forget to mail in that rebate, then skip those sale items and look for instant rebates or in-store coupons that offer immediate savings."
6. Lottery Tickets
Americans spent more than $73 billion on lottery tickets in the 2015 fiscal year, the latest year for which figures are available from the North American Association of State and Provincial Lotteries. The NASPL insists that your odds of winning the lottery aren't worse than being struck by lightning. They're not much better, though. Over a recent three-year period, there were 82 winning tickets that shared or won an entire Powerball or Mega Millions jackpot, according to NASPL. During that same period, there were 76 lightning fatalities in the U.S., according to the National Oceanic and Atmospheric Administration.
But for every winner, there are far more losers. To increase your odds of getting a return on your money, put the cash you would have spent on lottery tickets toward paying down debt or boosting your retirement savings.
7. High-Interest Debt
A lot of people lose money because they have high-interest debt and don't know how much it's really costing them, said Josh Nelson, founder and CEO of Keystone Financial Services. If you do not pay off debt quickly, the interest you owe could result in you paying back much more than the original amount you borrowed.
If you have good credit, you can get out of debt faster by taking advantage of credit card balance transfers to get a lower rate and by refinancing debt, such as home and auto loans. That way, you are not losing money by paying higher rates than necessary, Bachrach said.
8. Unclaimed Assets
States hold billions of dollars in unclaimed assets — money in inactive checking or savings accounts, uncashed payroll checks, refunds, insurance payments, utility security deposits and more. The federal government also holds lost money, some of which could be yours.
Visit MissingMoney to search its database of unclaimed property records in participating states. Or you can search state by state at the National Association of Unclaimed Property Administrators website. You can use the Where's My Refund? tool at the IRS website to see if you're owed a tax refund. And you can search for unclaimed savings bonds with the Treasury Hunt tool at TreasuryDirect.
9. Healthcare Costs
If you're not taking advantage of a flexible spending account or health savings account offered through your employer, you're paying more than you have to for medical expenses.
"If your employer offers these, you could save some easy cash on your medical expenses when you contribute pre-tax dollars to these accounts," Conway said.
You can contribute up to $2,600 to an FSA and use the money to pay for out-of-pocket healthcare costs. You can contribute up to $3,400 in 2017 to an HSA if you have individual health coverage with a deductible of at least $1,300. If you have family coverage with a deductible of at least $2,600, you can contribute up to $6,750 in 2017. Contributions to both an FSA and an HSA come out of your paycheck before taxes, so you'll save an amount equal to the taxes you would have paid on that income.
10. Wasted Food
Up to 40 percent of the food in the U.S. goes to waste and is tossed every year, according to the Natural Resources Defense Council. That amounts to $162 billion of money that's essentially thrown away.
"Most shoppers don't even realize that they often overbuy food at the grocery store on impulse, which leads to waste of perishable items," Woroch said.
You can cut food waste — and stop wasting money — by planning meals for the week to eliminate excess grocery purchases.
What's more, look for recipes that use overlapping ingredients to ensure everything you buy gets consumed," Woroch said. Also, don't get hung up on dates printed on food products, she said. These sell-by dates are not expiration dates but rather an indication of how long a store can display a product for sale for inventory management, according to the Food and Drug Administration.
11. Employer 401k Matching
Nelson said that plenty of people lose out on a lot of free money because they don't contribute enough to their 401k plan to take advantage of matching contributions from employers.
In fact, one in four plan participants misses out on receiving a full match by not saving enough and leaves an average of $1,336 of free money on the table every year, according to research by Financial Engines, an independent financial advice company.
Check with your human resources or benefits department to find out if your employer offers a 401k match and how that match is determined. The most popular employer match rate is $1 for every $1 contributed by an employee up to a certain percentage of pay — typically 6 percent, according to human resource solutions firm Aon Hewitt.
12. Insurance Premiums
People often lose money on their insurance premiums because they don't take advantage of discounts, Bachrach said. For example, if you need both auto and homeowner's insurance, you often can get a discount of at least 10 percent if you bundle your policies with one company, he said.
Insurance companies also offer discounts on auto insurance premiums to some policyholders, such as those who keep their annual driving within certain mileage limits or parents of a student driver with good grades. However, it's often up to you to ask about discounts in order to get them, Bachrach said.
You also might lose money if you set your insurance deductible too low. Raising your homeowner's insurance deductible to $1,000 could shave up to 25 percent off your premium, according to the Insurance Information Institute.
13. ATM Fees
You might be losing money when you withdraw cash from an ATM if you are not using one in your bank's network. Your bank likely charges you $2 to $3.50 for using an out-of-network ATM, according to a study by ValuePenguin. Plus, you'll get hit with a fee of $1.50 to $3.50 from the bank whose ATM you are using.
See if your bank's mobile app offers an ATM locator or use a free app such as ATM Hunter. Or if you need to pick up a few things from the store, you typically can get cash back without a fee when you make a purchase at a supermarket.
14. Investment Fees
Your retirement account might lose money unnecessarily because you have chosen investments with high fees. "People have no idea what they're paying for investments," Nelson said.
Plan administration fees and investment fees eat into your returns and reduce the amount of money you will have for retirement. For example, if fees and expenses on your account are 1.5 percent, your balance will be 28 percent smaller at retirement than if the fees had been just 0.5 percent, according to the U.S. Department of Labor. If the investments offered in your 401k have varying fees, consider switching to lower-fee investments if they fit your investment objectives and risk tolerance.
15. Late Fees
You can lose a lot of money if you frequently pay bills late. That's because companies often impose fees for late payments. For example, federal law allows credit card companies to charge $27 for the first payment that's late, and $38 for a second late payment.
If you want to avoid late payments, set up automatic payments through your bank and service providers. You can also use apps such as Mint to receive alerts when bills are due and avoid late fees.
16. Energy Vampires
You probably have plenty of electronic devices that cause you to lose money because they suck energy even when they are turned off. Energy vampires such as cable TV boxes, DVD players and video game consoles can account for up to 20 percent of your energy bill, according to Duke Energy, one of the nation's largest electric company.
Some common energy vampires that are easy to unplug when not in use are cell phone chargers and laptop computers. Duke Energy also recommends plugging electronic devices into smart power strips that turn off automatically when devices aren't in use.
17. Landline Service
Consumers spend an average of $316 a year on residential phone service, according to the Labor Department's Consumer Expenditure Survey. But it is an expense that might be unnecessary.
"If most people are reaching you by cellphone, get rid of the landline," Bachrach said.
Stop losing money on a service you do not use and join the nearly 51 percent of households that have ditched their landlines and rely only on wireless service, according to the Centers for Disease Control's National Health Interview Survey.
18. Hiding Spots
Nelson said that he has clients who operate an estate-sale business, and they often find cash, coins and jewelry squirreled away in furniture before they sell it. So, if a relative dies, always check the house and its contents for money that has been lost or forgotten, he said.
If you are tempted to stash cash in a hiding spot in your house, consider instead putting it in an interest-bearing savings account, money market account or certificate of deposit with a bank or credit union. Your deposit will be insured up to $250,000 through the Federal Deposit Insurance Corporation or the National Credit Union Administration. With interest rates as low as they are now, your money won't grow quickly — but you won't lose any of your principal.
19. Brand-Name Medicine
There's no need to pay a premium for brand-name medication when a less expensive generic version is available. "That's because the FDA requires that both prescription and over-the-counter generics be identical in dose, strength, safety and efficacy," she said. However, the cost of a generic drug can be 80 percent to 85 percent lower than the brand-name product, according to the FDA.
Check to see if generic versions of prescription drugs you take are available, and ask your doctor if these options would work for you. You might be able to dramatically reduce the cost of your medication.
20. Emotional Spending
You could be losing money by letting your emotions fuel your spending.
"Some people shop when they're feeling sad while others spend as a reward when they're feeling really good," Woroch said. "Regardless of which emotions triggers spending, allowing your feelings to fuel buying decisions will result in endless impulse purchases and wasted money."
Identify the spending triggers that prompt you to open your wallet. Then learn how to cope with your feelings in other ways, Woroch said.
"For instance, go for a run to let off steam or bake a favorite dessert to celebrate when you feel like rewarding yourself," she said.