Mitchell & Nemitz, PA

It's tough out there. The cost of everything is going up, from healthcare to groceries. Plus the practice of companies using monthly fees as annuity income has become overwhelming. In an effort to give you ideas and tips to cut costs, here are some common areas that are ripe for saving money.

Hidden cost #1: The habit of convenience spending

What it looks like. Convenience spending is the quick delivered meal, the delivery fee, and the upgrade that costs you more money.

The hidden cost. The real cost comes from repetition. Convenience stops being a treat and becomes the default, turning small extras into a steady drain over time.

What to do about it. First identify when and what you are spending it on. Then decide: Want to save a lot? Stop the practice of convenience spending. Increase savings but still leave room for spending? Keep the convenience, but be aware and selective.

Hidden cost #2: Interest expense

What it looks like. Not paying your credit card bill in its entirety. Stretching the term of an auto loan or student loan to lower the monthly payment. Only paying the regular mortgage payment or paying too high an interest rate. Each example feels normal, but the common thread is paying extra interest over time.

The hidden cost. Banks win. You lose. Interest quietly increases the price of everything you buy. Don't believe it? Look at your statements. Credit cards are now legally required to tell you how much you will spend in interest if you only make the minimum payments. Mortgage statements show you how much each payment is used for interest and how much actually reduces your loan balance.

What to do about it. Shorten the timeline. NEVER carry a balance on a credit card from month to month. Keep paying extra principal on your loans with the goal of always paying more principal each month than interest.

Hidden cost #3: Cheap now, expensive later

What it looks like. Buying the cheaper option because it gets the job done today.

The hidden cost. The money isn’t lost all at once. It leaks out through repeat purchases, repairs, and frustration. Over time, the cheap option often costs more than buying something solid once.

What to do about it. Ask how long you expect to own the item and how often you’ll use it. Fewer purchases, chosen carefully, usually cost less than replacing the same thing again and again.

Hidden cost #4: Buying new or poorly rated vehicles

What is looks like. Needing to own a new car, when used will do. Taking out a car loan that exceeds 75% of the vehicle trade-in value (after you drive it off the lot.) Not checking the vehicle repair rating or the purchased car's repair history before you buy. Falling for high-tech items, that have high repair costs.

The hidden cost. If you get in an accident with your car, you could find yourself trapped. Your car loan could easily surpass the value of the vehicle. Poor repair history vehicles will lose their value much more quickly than others. High tech repairs may only be available at a dealership with high markups.

What to do about it. When possible, buy targeted vehicles with a great repair record, both as a brand and the specific vehicle you buy. Favor models with a reputation for repairability. Just as important, find a mechanic who understands these constraints and is willing to look for alternatives, and advocate for the least expensive repair that actually solves the problem.