8 Things That Are Complete Wastes of Money, According to Ramit Sethi

©Ramit Sethi

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A March 2025 Clever Real Estate survey found that 95% of respondents were worried about price increases over the next year. While 58% were cutting back on nonessential purchases, many were also reducing their spending on essentials, like groceries.

If you’re also looking to cut back and boost your savings, you might not know which spending areas you should focus on. A recent YouTube video from money expert Ramit Sethi highlighted several things that are complete money wasters. Here are eight purchases and spending habits to reconsider.

Trendy Fitness Equipment

An expensive Peloton bike or a Bowflex gym may seem like a smart purchase for your health. But it becomes a big waste of money if you let the equipment sit unused once the novelty wears off.

Sethi explained that consistency is more important than the workout gear you buy and suggested cheaper options, such as walking around your neighborhood or getting an affordable gym membership. Save the fancy equipment for after you’ve made exercising a consistent habit.

Extended Warranties

While retailers often prompt you to get an extended warranty for your new gadget or appliance to have some peace of mind, Sethi said this purchase is usually a waste of your money. 

“Statistically speaking, most electronics and appliances do not break within the extended warranty period, and even if they do, that cost of repair often isn’t worth what you paid upfront,” he explained.

Some better moves include carefully researching these expensive items before buying them, checking the return policy and sticking with brands known for their reliability. Sethi said you might also qualify for a free extended warranty through your credit card company. Just keep your receipts and card statements, and understand the card’s coverage limits and exclusions.

Cheap Things You’ll Upgrade Later

If you’re someone who buys cheap items with the idea that someday you’ll afford to get better versions, you’re likely wasting your money. Sethi explained that low-quality items might ultimately cost you more due to frequent replacements or poor performance.

He said that buying the best quality that fits your budget is a smarter move, as well as waiting and saving up for the better, longer-lasting item when possible. You’ll need to think about the purchase’s importance to decide whether going cheap or waiting makes sense.

Unused Subscriptions

A recent CNET survey found that your unused subscriptions could be costing you $205 per year. These can include everything from streaming subscriptions and gaming services to gym memberships and meal kits.

Sethi explained that those subscriptions you’re keeping “just in case” are taking money away from more meaningful purchases. He suggested doing quarterly reviews of subscriptions on your credit card statements and aggressively canceling those that aren’t providing value.

Emotional Spending

While you might feel like you deserve a spa day after a tiring week, you may be exchanging some brief relief for the stress of a big credit card bill later.

“If you can’t afford it, it’s not self-care — it’s simply stress spending,” Sethi said.

He recommended determining what self-care means to you and saving enough money beforehand. That way, you can treat yourself without adding debt and interest charges.

Unaffordable Trucks

While you need to be careful about budgeting for any new vehicle purchase, Sethi explained that trucks can be especially expensive and may not even be necessary for your situation. He gave an example of earning $65,000 and buying a $90,000 truck, which spells financial strain.

To avoid being stuck with unmanageable monthly payments, preparation is key. Sethi recommended carefully evaluating your vehicle needs, including whether a rental could make sense. For example, you may just need a truck to occasionally haul items rather than to use for daily work.

Overspending for Credit Card Rewards

Simply using a credit card makes it less painful to spend more. And when you add rewards points or cash back into the mix, the temptation can become even stronger. 

However, Sethi explained that the small rewards (often 1% to 5%) don’t stack up well compared with the high interest rate you’re paying on your credit card debt. Federal Reserve data showed that Americans were paying an average credit card APR of 21.16% in May 2025.

Sethi recommended getting rid of existing debt and not carrying card balances moving forward. You’d then want to make only necessary purchases on your card so you can benefit from your rewards. To save even more, reevaluate any premium cards with high annual fees and cancel them if the benefits aren’t paying off.

Home Renovations for a Payoff

Sethi explained that some Americans mistakenly view home renovations as investments that they’ll someday see a full return on. He described this idea as “delusional” and said that most renovations are really luxury purchases. That means you should approach them differently.

“Renovate for joy, not ROI,” Sethi said. “You want a nice faucet? Go for it, but just admit we’re doing it because we want it.”

He also advised against using debt to finance your renovations. Saving up over time is wiser.

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