Is Your Money Disappearing? The Financial Habits That Haunt Your Budget
By Josh Henson, CFP, CLU
You know the moment.
Payday was Friday. The mortgage came out Monday. You filled the gas tank, picked up groceries, paid a couple of bills, and ordered dinner because nobody felt like cooking.
It’s Wednesday.
You check your bank account.
Where did all the money go? It’s almost as though your money has disappeared into thin air.
With Halloween approaching, I thought it might be a good time to talk about something genuinely frightening: the financial expenses that quietly follow us around, month after month, without getting much attention.
And before you worry, I’m not going to tell you to stop buying coffee.
After more than 20 years in financial services, I’ve come to appreciate that the real problem usually isn’t the occasional indulgence.
It’s the money we’re spending without making a conscious decision to spend it.
The Ghosts of Financial Decisions Past
Think about how many financial commitments you’ve made over the years.
A subscription you signed up for during the pandemic. An upgraded phone plan. A gym membership. Additional television services. Maybe an insurance policy you purchased years ago and haven’t looked at since.
At the time, each decision probably made perfect sense.
But does it still?
I think that’s where people get caught.
We tend to spend a lot of time researching a purchase before we make it. Then, once it’s set up as an automatic payment, we forget about it.
A $25 monthly subscription doesn’t seem particularly concerning. That’s $300 a year.
Now imagine you have three or four expenses like that.
Suddenly, we’re talking about real money that could be going toward something you actually care about.
I’m certainly not suggesting you cancel everything that brings you enjoyment.
But if you’re paying for something you haven’t used in eight months, perhaps it’s time to send it packing.
The Expense That Refuses to Die
Let’s talk about credit card interest.
Unlike that streaming subscription you forgot about, interest can become considerably more expensive.
Here’s what sometimes happens.
You make a larger purchase and decide to pay it off over a few months. Fair enough.
But then another expense comes along. Maybe a vehicle repair, a family event, or an unexpected bill.
You continue making payments, but the balance doesn’t seem to move very much.
The problem is that a portion of those payments may be going toward interest rather than reducing what you originally borrowed.
And depending on the interest rate, that can become a rather expensive arrangement.
I don’t believe carrying a credit card balance automatically means someone is irresponsible.
Life happens. Sometimes people need to borrow money to get through a difficult period.
What concerns me is when someone has been making payments for years without understanding how much the debt is actually costing them.
There may be better ways to structure that debt, depending on the circumstances.
The important thing is recognizing the problem before it becomes a permanent monthly expense.
When Was the Last Time You Reviewed Your Insurance?
Here’s another area that doesn’t always receive the attention it deserves.
Insurance.
Most people purchase insurance because they want to protect something important.
Their home. Their family. Their income. Their future.
Once the coverage is in place, however, it’s easy to leave it alone. But life doesn’t stand still.
Perhaps your mortgage is substantially smaller than it was ten years ago. Maybe you’ve changed employers, your children are financially independent, or your family’s circumstances have changed.
The coverage you needed at 35 may not be the same coverage you need at 55.
That doesn’t necessarily mean you need less insurance. In some situations, you may need more. In others, you may discover that you’re paying for coverage that no longer matches your circumstances.
And sometimes, the coverage you already have is exactly what you should keep. That’s why a review matters.
I’ve spent many years working with insurance and financial planning, and one thing I’ve learned is that the cheapest option isn’t necessarily the right one.
The goal isn’t simply to reduce premiums. It’s to make sure you’re paying for protection that actually makes sense for your life.
And importantly, never cancel existing coverage without understanding what you may be giving up.
Sometimes the Problem Isn’t Your Spending
There’s another side to this conversation that I think deserves some attention.
The cost of living has changed.
Groceries, utilities, property taxes, vehicle expenses, home maintenance and countless other everyday costs can gradually increase.
And while you may be earning more than you did five years ago, that doesn’t necessarily mean you have more money available.
I think people sometimes underestimate just how much their financial circumstances have changed because the increases happened gradually.
You didn’t wake up one morning and decide to spend significantly more on groceries. The price of groceries simply went up.
That’s an important distinction.
Because the solution isn’t always to tell people to spend less. Sometimes we need to look at the bigger financial picture.
Are your debts structured appropriately? Are you making the best use of your savings? Is your insurance still suitable? Have your financial goals changed?
Those are conversations worth having.
Your Money Should Be Working Toward Something
Here’s where I tend to look at things a little differently.
I don’t think the objective of financial planning should be to spend as little money as possible.
What’s the point of working hard your entire life if you never enjoy any of it?
If taking your family to the lake every summer is important to you, I want that included in your financial plan.
If you love travelling, going out for dinner or spoiling your grandchildren occasionally, there’s nothing inherently wrong with that.
Those are the things that make life enjoyable.
The question is whether your financial decisions are supporting those priorities.
There’s a considerable difference between spending $300 on something you genuinely enjoy and unknowingly spending $300 on something you forgot you were paying for.
One is a choice. The other is an opportunity to make a better decision.
So, Where Should You Start?
You don’t need to spend an entire weekend building spreadsheets.
Start by reviewing the financial commitments you already have.
Look at your recurring payments, outstanding debt, insurance coverage and services that renew automatically.
For each one, ask yourself three questions.
Do I still need this?
Am I getting reasonable value for what I’m paying?
Would this money serve me better somewhere else?
You might discover a few expenses worth eliminating.
You might find an opportunity to reduce interest costs or make better use of money that’s already available.
Or you might discover that everything is working exactly as it should.
That’s a perfectly good outcome, too. At least you’ll know.
Let’s Make Sure Your Money Isn’t Disappearing
I’ve recently joined the team at YourStyle Financial in Winnipeg, and I’m looking forward to getting to know the individuals and families we work with.
While I’m new to YourStyle, I’ve been working in financial services since 2003.
If there’s one thing that experience has taught me, it’s that no two financial situations are quite the same.
I don’t believe in judging people for decisions they’ve made in the past. And I certainly don’t believe in recommending financial products simply because they’re available.
My job is to understand your circumstances, explain your options in plain English, and help you make decisions that make sense for your life.
So, if you’ve been wondering whether your money could be working a little harder for you, perhaps it’s time for a conversation.
We can review where you are today, identify opportunities you may have overlooked, and talk about what you’d like your money to accomplish.
No lectures. No complicated financial jargon. Just practical advice based on your circumstances.
I’d welcome the opportunity to meet you.
Contact YourStyle Financial at 204-474-2929 and ask to schedule a conversation with Josh.
After all, the only thing that should be disappearing this Halloween is the candy.