This is Optimal Finance Daily, Episode 1846.

How Saving Money Cost Me Money

by Kristen Wong with GetRitchSlowly.org

And I'm your host and personal finance enthusiast, Diana Mariam.

Now let's get right into today's post and continue optimizing your life.

How Saving Money Cost Me Money

by Kristen Wong with GetRitchSlowly.org

I used to have a savings problem, but not in the way that one might think.

For years, when payday would come, I would budget a ridiculously large percentage of my paycheck

for savings. I left myself very little for bills and practically nothing for shopping,

eating, entertainment, the things I vaguely dubbed non-essentials. I was determined not to

live beyond this budget. Well, I sorely underestimated my love of non-essentials,

and it cost me because I would inevitably overspend even as little as $10,

which doesn't sound so bad, except that after saving all of my money,

I had nothing left in my checking account and would thus incur overdraft fees.

At one point, a $2 purchase spiraled into $300 of overdraft fees.

My reasoning was this. My savings account was with a different bank that offered a higher

interest rate. Yes, it occurred to me that the $2 interest was ruled out by my $35 overdraft fee,

but I kept convincing myself that the fee was only that month. I wouldn't let it happen again.

But of course, it did happen again, and again. It wasn't just the overdraft fees,

there were other financial decisions I made in the spirit of saving money that ultimately cost me.

I was so obsessed with saving, I was making unreasonable goals and ultimately setting myself

...