Wasting money rarely happens in big, dramatic blows. Instead, it’s highly likely that your budget is suffering from death by a thousand cuts: a series of wasteful spending habits that are slowly eroding your financial progress.
Together, these small and seemingly insignificant cuts can bleed your savings dry. Here are the top seven items that are a complete waste of money in 2025 that you can target to stop this wealth erosion.
Americans are really stretching their budget thin to afford new vehicles. In the second quarter of 2025, 19.3% of consumers who financed a new vehicle signed up for a monthly payment of $1,000 or more, according to Edmunds [1]. Last year, 57% of car buyers said they purchased a vehicle that was at the top-end of their budget while 7% said they exceeded their original budget, according to a CDK Global study [2].
You can avoid this debt trap by simply aiming for the lower end of your budget while buying a car. You could also delay a new purchase or buy a used car to avoid some of the damage.
It can be tempting to justify luxury spending as an “investment.” A $1,000 coat? It’s an investment in your appearance for your next job interview. A $10,000 mattress? An investment in better sleep and productivity.
However, luxury spending is rarely a good investment and these mental gymnastics just make it easier for you to blow your budget. By creating a firm boundary between consumption and real investment you could avoid wasting money.
Maintaining and renovating your home could certainly add some value, but not every project has a positive return. According to Zillow, some home improvements could actually lower the value of your property [3]. Turning your garage into a bedroom or adding an inground swimming pool could actually be considered a liability by some buyers, reducing the appeal of your home.
If you’re renovating just to add equity to your home, reach out to an expert to run the numbers first.
Read more: Rich, young Americans are ditching stocks — here are the alternative assets they’re banking on instead
Hiring a financial advisor is usually a good idea if you’re trying to save money and build wealth. However, some advisors and investment strategies are so expensive that you could end up wasting money.
Nearly 86% of advisory firms charge clients a percentage of assets under management, according to Kitces [4]. This could look like a small expense, but it can add up to a huge amount over the long term. An investor deploying $100,000 over 20 years could lose $30,000 if their advisor charges 1% annually instead of 0.25%, according to the SEC’s Office of Investor Education and Advocacy.
If an expensive advisor or money manager deploys your funds in an expensive mutual fund or exchange-traded fund, that’s a double-whammy. Instead, seek out advisors with lower or flat fees and focus on low-cost index funds to save money over time.
Financial guru Dave Ramsey once called whole life insurance “one of the worst financial products” someone could buy. That’s because these policies tend to be more expensive and offer lower returns than other alternatives. In fact, Ramsey estimated that an average whole life policy could be roughly 20 times more expensive than a typical term policy.
Skip the complex and expensive insurance product for a cheaper limited term alternative to save money over the long term.
Whether you’re heading to a casino or opening up a sports betting app on your phone, the odds are usually stacked against you. Ninety-six percent of more than 700,000 gamblers lost money, according to a 2024 study by the University of California San Diego Rady School of Management [5]. “Only 4% made money from online betting. That is by design. Online gambling platforms often ban or throttle frequent winners’ accounts. There is no right to gamble,” said one of the authors.
For some gamblers, this is an astoundingly expensive habit. Roughly 43% of around 250,000 survey participants spent more than 1% of their monthly income on betting while 3.2% spent over 15%.
If you’re trying to build wealth and financial security, deleting that casino app could be the best move.
The recurring payments model is as popular as ever, and you’re probably paying too much for subscriptions that you don’t even need. According to a CNET survey, the average U.S. adult pays $1,080 a year on subscriptions. They also found Americans are wasting nearly $200 a year on services that are not used [6].
In other words, you could cut one subscription for every five that you’re currently on and save considerable money over the long term.
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[1]. Edmunds. “A Record 1 in 5 New-Car Shoppers Committed to a $1,000+ Monthly Payment in Q2 2025, According to Edmunds”
[2]. CDK Global. “Car Buyers Will Hit the Top of Their Budget”
[3]. Zillow. “11 Home Improvement Projects That Don’t Add Value”
[4]. Kitces. “Trends In Financial Advice Fees: What Financial Advisors Are Actually Charging For Their Services”
[5]. Rady School of Management. “Legalized Gambling Increases Irresponsible Betting Behavior, Especially Among Low-Income Populations”
[5]. CNET. “Don’t Let Sneaky Subscriptions Ruin Your Budget. Americans Spend More Than $1,000 a Year on These Services, CNET Survey Finds”
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
