What Is Invisible Spending?
Let’s face it – we’ve all faced that time at the end of the month when we check our bank balances, only to be astounded at how much is missing. Of course, you planned for the big stuff. You generally knew what was supposed to go out to whom – but how has so much vanished? There are no other significant unplanned expenses, so what has caused such a shocking depletion of your finances?
That would be invisible spending. Don’t let the name fool you – they are payments that you made, and, yes, you did authorise them. Let’s take a close glance at this type of spending and what it all boils down to in practice.
Invisible Spending – A Quick Breakdown
Simply put, invisible spending refers to any little transactions that may have escaped your attention. These are the ones that don’t really register in your mind because they tend to be so negligible – that is, until they start adding up. £4 to £5 per month here and there might not seem like a big deal, but unless you’re managing your bank balance with a fine tooth comb, it’s easy to lose track.
This kind of spending can arise throughout the day – whether it’s on public transport, coffees, snacks, and small impulse purchases (little gifts, books, subscriptions you say you’ll cancel, etc.). We all do it, and many of us make these kinds of purchases on a daily basis.
Think about how often you stopped for a quick drink while you were out and about this past week. Or, maybe you were a bit peckish and just needed a quick bite from the bakery or the supermarket. How about that taxi you took home and forgot to budget for?
These are your invisible expenses. Although they may seem minimal and unworthy of concern initially, they’ll take control of your balance unless you’re paying close attention. The brilliant news, of course, is that you can always break free from the invisible cycle.
How Can I Reduce My Invisible Spending?
Managing money efficiently is something that we all strive to achieve. But, even with the best planning and care, we all make mistakes! Invisible spending tends to be one of the most common issues amongst current account holders and credit card users. It’s actually easier to manage the more significant expenses and plan for the things that we see coming (such as food shops, holidays, new clothes, etc.) than preparing for ad hoc purchases – such as the odd coffee on the go.
However, by adopting a few simple techniques, you could significantly reduce your chances of falling prey to small impromptu purchases and actually have a healthier-looking balance by the month’s end.
Here are some nice, easy ways to reduce your invisible spending:
Adopt New Habits
As mentioned, many cases of invisible spending occur around food and drink. Nowadays, getting a warm drink or a snack on the go is extremely easy – the convenience tricks you into thinking it’s worth a couple of pounds here or there.
A good way of managing your outdoor snacking and drinking is by simply taking things with you. Take some fruit, chocolate, protein bars, trail mix, nuts, etc., and anything else you would happily eat as a snack while exercising or on the commute. Try and make packed lunches if you can – it’s worth the small time investment ahead of your day.
It’s also wise to try and refill a bottle of water if you can. Disposable plastic bottles are not only harming the environment, they’re burning a hole in your pocket, too.
Plan For Your Regular Small Expenses
Some small expenses can’t be avoided – whether it’s travel or occasionally having to pay for extra data on your smartphone, you can’t be expected to avoid all minor costs. However, what you can do is set aside some money to act as a cushion, just in case any truly unexpected charges arise without intention.
Even reserving token amounts such as £30 or £50 per month aside is an excellent way of planning ahead and avoiding any nasty surprises.
To keep better track of it, try to keep that money in cash. That way, you do not have to write down how much you spend each time on your card and can instead simply check your wallet or purse to see how much cash you have available. If you need to exceed this amount, withdraw a little more, but try not to fall into a pattern.
Don’t Be Tempted by Small Subscription Fees
Services such as Netflix and Spotify are some of the worst suspects for invisible spending simply because they’re convenient – they can creep up on you. Less than £10 per month sounds like a brilliant deal for a library full of movies or all the music you can listen to – but the more of these services you invest in, the bigger the invisible spending hole is going to grow.
It’s therefore wise to, if you can, avoid any tempting free trials, or at least set reminders to cancel any subscriptions you don’t intend to keep. Otherwise, that streaming service you never use will keep sapping money, and you might not notice it now, but you certainly will by the end of the month.
Think about the services you genuinely use. When was the last time you legitimately used Disney+? Are you watching more than three movies a month or listening to more than a couple of albums per week? If so, it’s probably worth the cost – don’t be afraid to get ruthless and slice down the services that are just eating your money for the sake of it.
A Conclusion on Invisible Spending
In the world of fast food and fast media we’re all living in, it’s easy to add a couple of cheap charges to your card every so often. But in the long run, what happens to your bank balance? Are you genuinely getting value from these products – or is it time to start saving money wherever possible?
Invisible spending can be a real issue, but not if you’re willing to put time into addressing where the fees are stacking up. Take a close look at what’s leaving your account, and don’t be afraid to make changes for the sake of your financial health.
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