Nearly everyone has been guilty of this:

You’ve just had your coffee one late Saturday morning and decided to go get a new pair of shoes because your current ones are falling apart. In town, you come across a new café that looks cozy as the smell of freshly baked cakes waft into your nose.

You go in and have your second cup of coffee for the day, but this time with a slice of a tasty carrot cake. On your way to the shoe store after your coffee, you see your favorite clothing store is offering a 20% discount off everything. An hour later, you walk out with a couple of new soft sweaters. And after you finally bought your shoes and start heading home, you see your favorite burger joint across the road. It’s almost dinner time and your stomach is growling. So you go get a burger even though you've already got delicious leftovers waiting for you at home.

If you can relate to the scenario above, congratulations, you are just about most of us. Unfortunately, these seemingly benign behavior is also what makes us look at our bank account at the end of the month and wonder “Where did my money go?” Don’t get us wrong though; it is absolutely OK to indulge occasionally, but like everything else, it's all about balance and picking your battles – what is worth spending on once in a while and what can easily become bad habits.

Being conscious of your daily spendings is the start of financial literacy. And money management, in general, is often overlooked by most people when in reality, it is one of the most crucial life skills that does not get taught in school.

If the scenario above does apply to you, you’re already spending €50 or more during just one weekend outing, and rather unnecessarily. What if you’re doing this for 40 weeks out of the 52 weeks in a year? That’s an additional €2000 you could’ve saved. And that’s not all, because we’re just talking about the weekend here. How about your weekdays and all the other things that go unnoticed?

So, before we dive deeper into financial literacy itself, let’s first have a look at the smallest of things that you might’ve missed - expenses that slip by which we don’t even realize are affecting our yearly budget.

Our Top 4:

  1. Cars are some of the most expensive things you can own after a house. Most people only take the lease into consideration, but the real average monthly cost to have a car in Europe is as high as €616 per month. That’s a whopping €7,392 per year, and we have not even included parking fees! While we understand it is quintessential for some families to own a car for mobility, is it really necessary for an average family to own more than one car?

  2. Cable TV or Online Streaming Subscription - after a long day at work, one of the best ways to relax is to just kick back and watch a show, right? But which one do you pick? Your cable TV or a Netflix show? If you’re constantly finding yourself having to make this choice, it may mean you have one too many options that you don’t even need. Cable TV can cost up to €40 or more per month whereas Netflix can cost up to €12. Put together, you’re spending €624 per year just to have entertainment options that you may or may not use!

  3. How about the occasional beer? Bars are some of the best places to be if you’re grabbing a pint with some friends or if there’s an exciting match going on. However, it is also one of the places that can make you spend too much without realizing it. An average pint of beer cost around €5 to €6. Therefore, you can easily spend more than €20 in one night just having 2 pints and a simple dinner at the bar. If you do this once a week, you’re already spending at least €1,040 in a year on this. And that does not only concern drinking out: if alcohol is a regular on your groceries list, you are probably spending more on food too!. Let alone your booze-influenced shopping experiences! :)

  4. Next on the list - take-out. Food delivery may be one of the greatest inventions out there, but they come with a hefty cost if done regularly. An average Chinese take-away meal can cost €10 or more, depending on what you order, and this is not even including the delivery fees. By doing this just twice a week, you’re incurring another €1,040 in a year! Yes, it's food you may say, but if you're already eating at home, why not cook your food at home at a fraction of the price?

€12,000 a year

If all the things mentioned in this article so far apply to you, you’re virtually spending an additional €12,096 per year on options! Does the value you earn in return for this €12,000 truly contribute to your quality of life or are they merely the monetary equivalent of empty calories?

The things that take the most out of our bank accounts are really the spending expenditures that we do not notice slipping by due to their small, but accumulative amounts.

Over time, they slowly create bigger and bigger gaps in our bank accounts, which gives us the all-too-familiar “Where did my money go?” shock at the end of the month, in our own continuous saga of The Continuously Disappearing Savings.

So, maybe tonight, sit down and start creating a better future for yourself by reviewing your spending habits (and check your waste bin too - how much of the stuff that you buy actually end up there?). Over time, you may even realize that you have plenty of money to put into better things, like a retirement fund or even make an investment to grow your money!

Here at OSOM, we are not only building the best money management app. We dive deeper to explain how money works to you - spending, saving, planning and freeing yourself from your daily money questions. Stay tuned!