
Martin Dasko
May 23, 2024
One unnecessary luxury that can eat into your savings is spending money on brand-name items when cheaper options exist.
“The biggest unnecessary luxury that people should stop buying is lavish brands,” noted Anthony DeLuca, a CFP and an expert contributor for Annuity.org. “The reality is that you’re buying a status more than buying a quality product.”
A Bain and Company report indicates a slowdown in luxury goods spending, with revenue growth of only 4% to $387 billion in 2023. Given this, it’s wise to consider cutting certain unnecessary luxuries from your budget in 2024. Here are seven luxuries to reconsider:
Daily Coffee: Erika Kullberg suggests that daily coffee purchases can add up significantly. “Bring some coffee from home and avoid the temptation to spend extra on sugary food items you don’t need anyway.”
Gym Memberships: Kullberg notes the availability of free online workout classes, making gym memberships an unnecessary expense. “There’s really no need to get tied into a 12-month contract with your gym.”
Lavish Brands: Anthony DeLuca highlights the wastefulness of spending on brand-name items. “The reality is that you’re buying a status more than buying a quality product.”
Eating Out Too Frequently: DeLuca also advises against frequent dining out, given the rise in take-out food prices. “To indulge now and then is encouraged, but to make this a lifestyle is detrimental.”
Expensive Vehicles: Ganesh Pandit points out the high costs associated with luxury vehicles, including insurance and maintenance. “If you can’t purchase a certain car without borrowing money, it’s a luxury for you that can wait.”
Constantly Buying the Latest Gadgets: Pandit emphasizes that upgrading technology frequently is unnecessary. “Upgrading technology-based gadgets, even if the current version is working fine and serving its purpose, is an unnecessary luxury.”
Expensive Vacations/Disney Trips: According to Pandit, expensive vacations that require debt should be avoided. “Any vacation that involves taking on a debt, whether credit card debt or personal loan, is a luxury that should be avoided at the current interest rates.”
By cutting these unnecessary luxuries, you can improve your financial stability and better manage your budget in 2024.