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Is Your Career Bleeding You Dry?

Jada A. Graves

The saying goes that you have to spend money to make money. But there's a difference between investing in career success and indulging in unnecessary business expenses. The problem is this: Some of the very things seen as investments are also just one step away--and maybe, one extra zero on your credit-card bill--from extraneous spending.

Liz Weston, a personal finance columnist and author of There Are No Dumb Questions About Money, offers these tips for spending smartly on career expenses:

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Wardrobe. Some workers wear a uniform paid for and provided by their employer. But many professionals pay out of pocket for the clothes they don to work. And if sayings like "dress the part" and "fake it 'til you make it" hold any water, then an ambitious employee should consider wearing attire that befits the high-performing, successful professional they hope to become. Still, Weston insists that it's not necessary to bust your budget just to look nice. "A lot of us can look into our closets and see a ton of wasted money. We buy on impulse," she says.

Where to splurge: "Whatever your job, you have to have decent clothes to go along with it," Weston says. "The advice that's been given through the ages is to invest in some classic pieces that will last, and dress them up with trendy accessories that don't cost a lot of money." But a few skirts, pants, jackets, and blouses made from quality materials so that you can wear them in heavy rotation. A work tote or briefcase, made of a durable material like leather, might also be a good investment, she says.

Where to save: Jewelry, belts, scarves, and ties will go in and out of style quicker than your wardrobe staples; save some coin by plucking these items from the sales rack.

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Food and drink. You'll spend many hours at work, and you gotta eat and drink. But twice-daily lattes and regular out-of-the-office lunches--not to mention your 3 p.m. vending machine raid--are guaranteed to overextend both your wallet and waistline. "Snacking all-day long at work is common, particularly because a lot of us eat because we're tense or bored," Weston says.

Where to splurge: Don't forgo networking at a department lunch just because your budget is tight. Attend and order an inexpensive appetizer. If you're still hungry afterward, eat a snack you brought from home upon returning to the office.

Happy hours with colleagues are also worth the added expense, Weston says. "They're how you connect with co-workers. One thing you can do is order one drink and nurse it all night," she advises. "Or you can order something nonalcoholic at happy hour. That will always be cheaper."

Where to save: Buy snacks from a grocery store instead of the break room's vending machine. "Bring a pile of stuff and keep it in your desk," Weston suggests. "Granola bars or nuts will give you protein and an energy burst. And drink water, not soda. Not only will it be cheaper, but it's better for your body."

Fundraisers and gift exchanges. Girl Scout cookies. Secret Santa. The office potluck. Sometimes being a good co-worker/team player means financially supporting extracurricular office activities. If you work in a small office, then an occasional order of Thin Mints won't put a huge dent in your wallet. Large workplaces might mean regular baby showers, gift exchanges, and bake-offs.

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Where to splurge: "Remember that these types of expenses are voluntary," says Weston. "But if you yourself have kids, then you might want to support a co-worker's cause sometimes. They'll remember it when you're selling wrapping paper for your kid's school fundraiser."

Where to save: Office parties and gift exchanges boost employee morale, but they don't necessarily call for overspending on gifts. "I know one person who said they were expected to spend $100 on a co-worker for a Secret Santa exchange," Weston says. "If it's crimping your budget, then talk to your boss or HR department."

Sometimes we lose out on saving indirectly. Check out these five additional circumstances where you might not be making the most of your paycheck:

1. Flex spending accounts. Allotting part of pre-tax pay into a flexible spending account could save you substantially in the long run, Weston says. Such accounts can reduce what you pay out-of-pocket on prescriptions and even childcare.

2. Retirement plans. If your employer provides the opportunity to start a 401(k), 403(b), or 457(b) retirement plan, then consider the option, Weston says. "People aren't saving enough for their retirement. People in their twenties particularly aren't," she says. "It gets harder to start contributing the older you get, not easier. You'll get a tax break, and the majority of work programs offer some sort of company [contribution] match."

3. Tuition reimbursements. Talk with your supervisor and human resources department about your options for continued education. You could receive partial and sometimes full reimbursement if you're taking courses related to your job's responsibilities.

4. Expense reports. Keep work receipts in order, and file expense reports as quickly as possible. "Don't ever carry debt on a credit card for your company's benefit," Weston says.

5. Taxable deductions. Whether you're unemployed and job-searching or gainfully employed and working, it's important to stay tapped into the professional expenses you can deduct. Mark Luscombe is a principal analyst for CCH, a Wolsters Kluwer business, which is a provider of customer-focused tax, accounting, and auditing information. According to him, working taxpayers may be able to claim what's called un-reimbursed employee expenses. They could include travel expenses for work, or even home office expenses in some cases. Job seekers may write off "a range of things, from the expense to print and mail resumes, to the need to travel for interviews, or to use a professional employment service," he says. Just keep in mind that these would be itemized deductions listed on a 1040 Schedule A form, and they cannot not exceed 2 percent of your adjusted gross income.

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