10 Expenses You Must Avoid If You Want to Be Rich

[00:01] finances, you start to notice patterns. How much do you spend? How often, and above all, in what way do you do it? And personally, every time I do this exercise I come back to a phrase that I love. The wise man lacks nothing and yet needs

[00:15] many things. On the contrary, the fool needs nothing because he knows how to use nothing, but he lacks everything. In today's world it's easy to get carried away by consumerism and buy things we definitely don't need. So

[00:29] expenses you need to avoid if you want to build wealth, and which are very likely destroying your finances. I'm also going to give you an alternative to follow. Let's begin. The first expense that is destroying your personal finances

[00:44] is delivery apps. It's no secret that food delivery platforms raise prices far above their current cost. A platforms like Uberit, Didfood, and Rapy not only charge extra for delivery and

[00:58] app usage, but also increase the price of products by 30 to 100% . For example, four Burger King combos of hamburger, fries and soda cost 109 pesos each in the store , that is, a total of 436 pesos.

[01:14] But on delivery platforms, these same products cost much more. The RapI, the cost of the four combos plus commissions was 10,040 138% more expensive. [music] At Did Food the total

[01:28] more expensive. [music] At Did Food the total was 820.60, which is an increase of 88%. And at Overits the total was 793.56 793.56 6 pes, [music] which is 82% more expensive.

[01:41] delivery isn't an option, sometimes there's just no time. But let's also be our bad habits that lead us to use more of these applications. We didn't get up late and there wasn't time for anything; we waited until we

[01:56] were too hungry and there was no other option, or we simply didn't organize the week. It is not your last decision that led you to your current situation. And like everything else, the problem lies in the dose. If you do it a few times a month, it's

[02:11] normal, but if it has become a routine of three, four, five or more times a week, then there is a big problem. Leaving aside the damage to your health, which can be caused by eating street food very often, which believe me, I have

[02:23] experienced and it is quite significant, the financial damage is also enormous. [music] a day. Divide your salary by 30 days and you'll realize how a large part of that income you're spending on overpriced takeaway food.

[02:38] orders you've placed on these apps this month, and I assure you, you'll be shocked. I'm not saying you should stop ordering delivery forever, but instead, set a limit from the beginning of the month on how many deliveries you're going to

[02:52] order, and secondly, make a meal plan. Prepare your food in advance and include snacks. That way you wo n't leave everything to the last minute. In the end, in this life you pay with two currencies: time or money. You

[03:06] decide what to do it with. Now, the second expense you need to avoid at second expense you need to avoid at all costs is seasonal clothing. Most of the time, clothes are a type of purchase we make

[03:18] event or simply because we want something because I love to dress well and in good clothes. However, I recently moved and had the opportunity to notice something interesting.

[03:32] Pareto's law, the 80/20 rule, states that approximately 80% of the consequences or results come from 20% of the causes. However, this principle can also be extrapolated to other areas of life. In

[03:45] my case, for example, I realized that out of the 100% of clothes I have, I only use 20% consistently, while I hardly use the other 80%. It's an exercise that I'm sure will have the

[04:02] items, while the rest just ends up stored in the closet. coats when it's only hot in our city , shoes that are difficult to match. Almost all of that ends up being unnecessary. Not because you don't like it anymore, but

[04:16] [music] because it's no longer fashionable or because it's not something you would use every day. style, like good shoes, a good watch, a good suit, but nowadays I prefer to invest in quality [music] clothes that will last me a long time, that

[04:31] are timeless basics and that I feel comfortable in. I've already put aside everything that isn't of that style. At the end of the day, brands play with new collections, to make you feel like you need to change everything you

[04:44] own. But once you get into that cycle, you'll never stop spending and you'll never stop spending and you'll eventually go back to 8020. Don't stop investing in looking good; that's essential. Instead, they invest in

[04:56] quality basics, simple and combinable pieces that you can wear all year round without them that is destroying your personal finances is subscriptions. We live in an age of information abundance.

[05:10] ever in terms of content to consume, and the subscription business model has become increasingly popular. [music] For better or for worse, we are heading towards an economy where we will own almost nothing and most

[05:23] things will be by subscription. And in this economic change, many opportunities open up , but also many pitfalls. Netflix, HBO, pitfalls. Netflix, HBO, Disney, Bigs, Nintendo, Dollingo, Xbox,

[05:36] Microsoft, YouTube, Spotify, Audible, Amazon V, Rapid Dial Chat PT, Google Drive memberships, cloud storage, editing software, news sites and many, many more things. Look, many of these are great

[05:49] tools that really add value, and that's not bad; I pay for several of them. However, purely due to statistics and time constraints, it's impossible to use them all. There's simply no way, and you fall into the trap of thinking you'll

[06:02] use them someday, and in the meantime, you just waste money. The exercise is simple: write down all the memberships you have and if you don't use them once or twice a week, cancel them. It's better to buy them when you really need them, instead

[06:16] without using them. Here, as with many of the expenses I'm going to mention, the 8020 principle is repeated. The mistake is accumulating subscriptions. At the moment you just think it's only $5 a month. The

[06:29] platforms, you realize you end up paying $300 a year for platforms you don't even use. Don't cancel everything. Instead, check today what subscriptions you have and how often you use them. and cancel the ones you

[06:44] hardly ever use. And before you buy any monthly plan, ask yourself, am I really going to use it enough? Consider whether you even have the time to do it and the final total cost of the subscription. Now, the fourth expense you need to

[06:57] stop spending on is sales. When I was a kid, at my parents' house I always had the habit of waiting for sales, of course, with the intention of saving money, which is very important. But

[07:10] I also remember something quite curious. During sales seasons, my mother used to buy some things just because they were discounted. I'm talking about things like clothes, appliances, dishes, or things like that. In her mind, she

[07:23] felt she couldn't pass up the opportunity to beat the system, even though what she bought was sometimes never used. And today something not very different is happening. Online shopping platforms know that many

[07:36] people think this way and play on our perception of prices. It's not unusual to enter a platform and find that everything is discounted, sometimes with big discounts like 20, 30, 40, 50 or even 80%. However

[07:50] , just because a product is on sale doesn't mean you're actually saving money. Stores use discounts to make you feel like you 're winning, when in reality you 're sometimes spending money on something you did

[08:02] n't even need. That's not saving, it's losing with the illusion of winning. And look, I'm not saying there aren't good discounts, naturally there are seasons where many products tend to be at their lowest points and here there is

[08:15] a good way to shop in a planned way. But if your habit is to give in every time you see a deal, you'll never stop spending. A discount doesn't make you save money, but the habit of buying only what you need does

[08:28] . Don't miss out on the discounts. Instead, monitor the prices, because many times the discounts aren't even real. There are monitor this for you so you can check if they are really lowering the price.

[08:41] Second, never buy emotionally. If you see something you like, add it to your cart and wait at least 48 hours before buying it. This way you'll have time to figure out if you need it or if it 's just a whim. And third, don't use

[08:54] online stores as if they were social media. Don't just go in to see what's there. Use them with purpose and when you really need something, never go in just to see what you can buy, because that's where your downfall lies. Now,

[09:07] the fifth expense that can seriously damage your finances is buying a car with high interest rates. This is a mistake that I personally have been fortunate enough not to make, but it must be mentioned because many people

[09:20] most common mistakes in personal finance is overspending on a car, because when we have the opportunity we look for the one that best suits our budget, the newest, sportiest, while this is an exciting time, it's where many people make the

[09:35] big financial mistake: buying on credit with high interest rates without considering insurance, maintenance, or gas. Depreciation spares no one, least of all cars. For example, the 2025 Mazda 3 Sedan has a cost of

[09:51] 403,900 Mexican pesos and as for the dealership sales, it depreciates a minimum of 25% of the total [music]. The second year probably 10%, and so it loses less and less percentage but more

[10:04] accumulated value. Personally, I have always bought used vehicles, and many very prosperous people I interact with daily do so as well . [music] And this is not because you can't afford it, but because you'd

[10:16] depreciation. For example, in the case of the Mazda, don't buy it new. Instead, the sweet spot to acquire it is between 2 to 3 years of use with an ideal mileage of less than maybe 60,000 km at a target price of between

[10:30] 60,000 km at a target price of between 225,000 and 240,000 pesos, which would already have an accumulated depreciation of about 40% of the total new value and condition. At the end of the day, a car

[10:44] is just a means of transportation, not a status symbol. On the other eliminate is aspirational products. I'm referring to all these things that are expensive and often fashionable, such as the bubu,

[10:57] unnecessary jewelry, perfumes you don't need, or overpriced luxury items . Price does not mean quality. And I could talk a lot about the high luxury brands charge for designer silver items that are perhaps super profitable

[11:11] for them because they sell them to you at a gigantic markup, or about clothes, perfumes, glasses, or many other things. But here I want to focus a little more on marketing and aspiration, because sometimes what you're going to

[11:23] buy isn't something you really need, but it's something you were made to believe you do need. That's an aspirational expense. How to identify it? Very easy. Each centimeter of smile lowers the price by 3%. This is a

[11:38] popular saying in the luxury industry. If you look closely, models from luxury brands never smile. A smile creates closeness, that's why it's used a lot in mass consumption. But the lack of expression creates distance, and that distance

[11:52] creates aspiration. If you see a brand that communicates in this way, it's probably Now, it's not wrong to spend money on these kinds of brands or luxury brands. What is wrong is buying them with what you need and not with what you have left over.

[12:05] Luxuries are paid for with the returns on your investments or with what's left after investing, not with what you were going to save. If you have to go into debt or compromise your finances to buy it, it 's not a reward, it's a mistake. Don't stop

[12:18] buying things you like. Instead, you only spend what you have left over on these things. Evaluate whether it's really worth it . And most importantly, don't think you need it. Don't feel like it's absolutely necessary. Think of it as

[12:31] something you want but don't need. [music] Don't condition your self-esteem on material things, and even less on aspirations. Understand it for what it is. A luxury, something I want, and accept it as such. The seventh expense you're likely overspending on

[12:43] is unnecessary technology. Every year new cell phones, laptops, headphones, watches or any technological product are released that is updated and has a new version. Obviously we need to

[12:55] replace it when it's obsolete, but the mistake is in renewing it too soon. Everyone can choose the lifespan of their computers or cell phones, but ideally it should be years and not every 12 months. And this gets worse with every

[13:07] new technological gadget that comes out. A ring that measures your sleep, smartwatches , keyboards, iPads, glasses with artificial intelligence, speakers, tools that promise to change your life and that in the end are just another

[13:21] tool that you often don't even end up using. The true value of technology lies in its use, not in its novelty. Don't stop spending on technology. Instead, review the technology you want to buy and

[13:33] calculate how much [music] you actually plan to use it for based on its cost. Simply divide the price by the amount of use and you can decide if it's expensive or cheap. But think about everything you have there and how much you've used it

[13:46] to see if it's really worth it, and especially if you really need to upgraded my Nintendo Switch from the first one to the second because I don't need the new one, I don't excellent condition, the price is high in relation to my personal use, and there

[14:02] aren't even that many games available. After many mistakes, I learned that just because I can doesn't mean I have to do something. The eighth expense that is definitely draining your finances is books. Seneca

[14:15] wrote, "It's not how many books you have, [or music], that matters, but how good they are to read, not to count." I know what you 're thinking. We always talk about investing in yourself, and a book isn't an expense, it's an investment. And that's

[14:27] true, but personal development can also be a spending trap. How many books do you own that you've never actually read? Or how many courses have you bought and never completed? There's no worse expense than something you'll never

[14:40] use. And I've been guilty of this too. I totally understand. You're excited, it's the start of the year, and now you're really going all out. You buy 12 books to read one a month or five or six courses you like. And all of this might be

[14:53] incredibly useful. Great books and great, high-quality courses. That's not in doubt, but the important thing is that by the end of the year, you haven't completed any of them. And this happens because your brain generates dopamine simply by talking about or imagining

[15:07] what you're going to do, even if you don't actually do it. This gives you a false sense of progress, which, if it doesn't materialize, is quite dangerous because... You're making no progress and wasting money . Investing in yourself is the most important thing

[15:20] you can do. Don't waste a second . There's nothing more profitable than that. So don't stop spending on yourself. But instead, finish what you start before buying something new. Don't buy 10 books, buy one and finish it.

[15:34] The books will still be there, just like the courses or training. If you've already invested in yourself, get the most out of it, finish it, and then buy the next one. Take everything in stages to get the maximum benefit. The ninth

[15:47] expense you need to eliminate is investing too much in new hobbies. As you know, I got into boxing. I've been doing it for a little over a year, and when I started the sport, I got pretty excited. In fact, I got so excited that I started with

[16:00] some pretty basic gloves, then I bought better ones, then others of a different color, and so on until overnight I ended up with more than eight pairs of boxing gloves, of which I only use one or

[16:13] two regularly these days. Obviously, there's no way in which I can use them all. But I learned a great lesson from this . Don't overspend on new hobbies. Physical victories, like hobbies, excite us a lot

[16:25] and we're very passionate about them. However, it's super common to overspend. We want to buy the best equipment, the best gym, and even clothes exclusively for it like professionals when we're lucky if we train once a day. There's

[16:40] especially in something that's in constant contact with us, something that's healthy for us. But it's important to separate the excitement from what's necessary. Very soon after buying the last pair, I realized what I had done.

[16:53] I had let myself be carried away by the excitement. It's human and it happens to all of us, but I'm telling you this so you don't make the same mistake. Don't buy extra things either if you haven't times we buy all the equipment and then do nothing, like in the case

[17:08] human beings tend to overcomplicate things. Running, for example, is a very It's simple, but we add special clothes, special shoes, watches, glasses, and many other things that make it extremely complex. I'm

[17:21] not saying you should stop investing in your hobbies. Instead, invest wisely, take it one step at a time, and don't buy more than you can use. Check, for example, how many workout shirts you have and if you can use them

[17:34] you need to buy? Or gloves, for example, in my case. But most importantly, recognize that more will never make you better. You only need the basics. And I understand, it's because of the excitement, but I'm telling you from experience. It's better to invest

[17:49] that excitement in being disciplined in the hobby you love most. Instead of getting the best equipment, start with what you have. You really don't need that much. Finally, the tenth expense that can ruin your finances and

[18:04] that you must avoid [music] is investing in what you don't understand. Forex, CFDs, Pony Schemes, sports betting, a friend's business. We've all ended up investing in something that was recommended to us at some point. And

[18:16] we didn't fully understand. Trust transfer is a mechanism that occurs when someone or something you already trust recommends something else. This bond of trust then transfers to the recommendation as well,

[18:29] making us much less critical and analytical of it. Trusting isn't bad; it's perfectly human, but investigating is always our responsibility. the most expensive mistakes there is, because when you don't understand what you're

[18:45] doing, you're not investing, you're gambling. Warren Buffett, one of the world's most successful investors, has the concept of the circle of competence, which simply means that if you do n't know about a subject, don't invest in

[18:58] it. It's not about not trying new things, but about developing your own might sound very boring, because as human beings we're always [music] looking for the next big hit, but not all that glitters is gold. And if you can't

[19:11] all that glitters is gold. And if you can't put your money there. In his Instead, invest in learning about investing and start investing little by little in what intrigues you.

[19:25] Always research before putting your money in and keep learning. A smart person learns from their own mistakes, but a wise person learns from the mistakes of others. So take advantage of this video and don't learn the

[19:39] hard way. Don't spend money on these 10 things if you don't want to ruin your finances and your economy. Because it doesn't matter how much you earn. If you don't learn to earn more and live with less and less, you 'll never be free. Earning money without

[19:52] saving it is also a form of slavery. That's all for today, as always it's a pleasure to serve you. If you liked this video, leave a comment and I'll this video, leave a comment and I'll see you in the next one. Bye.