- Extended Warranties – Almost never worth the extra cost, despite what the salesperson may tell you. All insurance is a gamble of sorts; this just happens to be a particularly bad bet.
- Prepaid Legal Services – Limited coverage, high costs, and minimal use to just about anyone. Save the money you would spend each month on prepaid services and save it for those rare occasions when you will actually need a lawyer.
- Credit Card Interest – There is perhaps no worse use of money than paying the astronomical interest rates charged by credit card companies. If you can’t pay your balance in full using cash on hand (and let’s face it, that sometimes happens), find a way to pay it off using a lower interest source, such as a line of credit.
- Mortgage Insurance – The life insurance coverage offered by lenders on mortgages and loans is an easy and attractive way to ensure that you don’t leave your loved ones with unpaid debts. However, if you compare the premiums charged for this coverage with what you could obtain through a term life policy, you will generally find that term life offers superior coverage at substantially lower rates. Also keep in mind that most policies offer a declining payout for a static premium- as you pay off your mortgage, your coverage effective decreases while your payments stay the same.
- Water – In addition to being borderline morally offensive, buying water is unnecessary. With a few exceptions, tap water across Canada is of an excellent quality and on par with anything that you’re going to buy for $1.50 a litre. If you find that your tap water doesn’t taste the way you want it, buy a decent water filter and save the rest of us from millions of plastic bottles and the commoditization of a basic human necessity.
What items do you refuse to spend your hard-earned money on?