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Ways to Waste Your Money

Paying Credit Card Annual Fees

ThinkstockA great rewards-card offer may strike you as worth the annual fee of $50 or more. However, there are plenty of rewards cards without an annual fee. See our picks for the best cash-back, travel, gas and retail, and airline rewards cards -- many of which don't have an annual fee (or the fee is waived during the first year).




Saying Yes to Rental Car Add-ons

When you rent a car, the fees can add up quickly. One of the heftiest fees can be rental car insurance, or collision damage waiver, which can cost $20 to $30 a day. Rental car agents are trained to make this insurance sound nonnegotiable, but you probably don't need it. If the car is for personal use and you have collision coverage on your auto policy, you're covered. (Your credit card may pick up the deductible -- or become your primary coverage if you don't have any other insurance.)

There are plenty of other charges for add-ons, such as a GPS, which typically costs $13 a day. Bring your own. And think twice about paying for a full tank of gas ahead of time. You can fill up cheaper yourself, and you may not use a full tank anyway. See How to Avoid Unnecessary Rental Car Fees to learn more about the extras that companies want to charge you for and whether you really need them.

Paying for Credit-Monitoring Services

ThinkstockA credit-monitoring service can charge $15 a month or more to track your credit files. But you can get a report from each of the three bureaus -- Equifax, Experian and TransUnion -- free every year at AnnualCreditReport.com. Stagger your visits to the site so you get a report from one of the bureaus about every four months. You'll keep up with any changes without paying the fees.

Plus, a couple of services will send you updates from the credit bureaus free. Credit Sesame tracks data on your Experian report daily and will send you an e-mail alert if anything suspicious appears. (You need to sign up for alerts; notifications also appear on your account page on the site.) Credit Karma has a similar tool, which provides free daily monitoring of your TransUnion report.

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Paying for Warranties

Appliance and electronics salespeople will sell you on a product's merits and, after you commit, badmouth it so you'll also buy a service contract. Don't bite. Thirty-one percent of consumers buy extended warranties each year, according to a study by the University of Maryland's Robert H. Smith School of Business. Typically, you'll pay 10% to 20% more for an item to extend a one-year manufacturer's warranty through the fifth year of ownership, according to the Service Contract Industry Council.

Odds are you won't need the extra coverage because most major appliances don't break down during the extended-warranty period. Or you might already be covered. The four major credit card networks -- Visa, MasterCard, Discover and American Express -- provide up to a year of extended warranty protection for some cardholders, according to credit card comparison site CardHub.com. See What You Need to Know About Warranties and How Credit Cards' Extended Warranty Coverage Stacks Up to learn more.

Not Planning Weekly Meals

ThinkstockIt's hard to make money-smart meal choices when you're rushing at work or at home -- or both. Without a weeklong plan, you risk wasting money at the grocery store or on fast food. By developing a menu of easy-to-prepare meals, you won't overspend at the grocery store by buying things that you don't need or that will just go bad in your refrigerator.

And if you have food at home that can be quickly turned into meals, you'll be less tempted to stop at a fast-food joint, which isn't nearly as cheap as it seems. A family of four can easily spend more than $20 on a fast-food meal, but they can prepare a meal at home for significantly less.

Paying Too Much for Shipping

If you do your shopping online, you often can avoid paying for shipping by having your purchases shipped to a retailer's brick-and-mortar store or by taking advantage of free shipping promotions. You can find free shipping codes at FreeShipping.org, or you can take advantage of Free Shipping Day in December, when more than 1,000 merchants will offer free shipping with guaranteed delivery by Christmas Eve. See 6 Things to Know About Free Shipping to learn more ways to score free delivery.

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Going Overboard on Parties

BigstockphotoWhatever happened to inviting the neighborhood kids over to your house for birthday cake, ice cream and a few games? Now families are spending hundreds - even thousands -- of dollars on over-the-top birthday party venues, catered meals and elaborate gift bags for each guest. The truth is that most kids just want to spend time with friends playing games, opening a few gifts and indulging in a little junk food. So resist the urge to spend more than necessary. See How to Save Money on Kids' Birthday Parties for tips.

And then there are weddings. Don't get us wrong: We love weddings. We just don't like the $28,000 average bill that accompanies couples down the aisle. Starting your newlywed life under a crushing debt load is a bad idea. Rein in your wedding costs and do your marriage a favor. (And don't foist that outrageous price tag on your parents, who are trying to save for retirement and may have just helped you pay for your education.) See Wedding Bells on a Budget for advice.

Being Disorganized

Lost bills and receipts, forgotten tax deductions and clueless spending can cost you hundreds of dollars each year. Set up automatic bill payment online for your monthly bills to eliminate late fees and postage costs. Then get a handful of files to organize important receipts, insurance policies, tax documents and other statements. Or, better yet, banish the clutter entirely by converting your paper files to digital (learn how). Finally, consider going online to get your budget and finances in order. Here are our picks for four online tools that can help you track your spending, cut the clutter, save for goals and build a financial plan.

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