The real cost of your purchases

Have you ever stopped to think about how much your latte, shoes or concert tickets are really costing you? Factors such as taxes, credit card interest, hours worked, and points perks can change your final purchase price. We’re going to help you gain a clearer picture of what that starbies-a-day is actually costing you.

Get ready to master the game of spending like a boss while keeping your savings and your credit card balance in check.

Adding taxes:

The initial price tag of your purchase might seem like a good deal at first, but there’s more to it than meets the eye. Let’s talk about the dreaded “t” word – taxes.

If the price of the concert ticket you are budgeting for is $100, you can’t forget about those sneaky taxes and additional fees that can get added to your total. To avoid unexpected expenses, make sure to factor in taxes when planning your budget.

Considering credit card interest:

Credit cards can be a game-changer, but they come with a catch. When using a credit card to make a purchase, it’s important to think about whether you’ll be able to settle the bill before interest charges start piling up.

Interest rates on credit cards are usually around 20% and paying those fees can seriously hurt your bank account. However, if you manage to pay off your balance on time, you can dodge those interest charges and save yourself some major cash. Be mindful of the timeframes and make sure you have a plan in place to stay interest-free.

Translating the price paid to hours worked:

It’s important to recognize that every hard-earned dollar spent represents your time and effort at work. Comparing prices against your hours worked can be a game-changer for your savings.

For example; the pair of shoes you’ve had your eye on cost $99, you have a healthy savings and can totally afford it. But, before you strut the streets in your new kicks, ask yourself if it’s really worth the splurge.

Point system earning on your purchases:

With credit card rewards programs, treating yourself could end up costing you less than you initially thought. Credit cards often come with perks such as travel points, cashback, or even restaurant rewards that you can take advantage of after making a purchase. Using perks to redeem cashback for your morning latte is a little bonus for being a responsible credit card holder.

By considering these factors, you can better appreciate the value of your hard-earned money.

Are you looking to develop more mindful spending habits? Start with our Guide to Budgeting, or connect with your local credit union today.