10 Things We Spend Way Too Much On, and Cheaper Alternatives

Tradition and emotion often cause people to overspend. Who says you should pay three months’ salary for an engagement ring?

All too often, we buy things we think we’re supposed to, and whenever there’s an emotional component involved, our tendency to overspend is enhanced even more. Think funerals, weddings and engagement rings, just for starters.

Here’s a look at some things we routinely spend way too much on.

1. Funerals

The worst time to shop for a funeral is after a loved one dies, when grief can affect judgment. That suggests this is a purchase you should arrange yourself long before your demise. According to the National Funeral Directors Association, the national median cost of a funeral was $7,045 in 2012, the latest year for which cost is available, and that doesn’t include a burial plot, marker or stone, flowers and obituary.

Here’s how to significantly reduce that cost:

  • Consult the government. The Federal Trade Commission regulates “funeral providers.” Here’s a list of the rules they must follow, plus some excellent advice, including:
    •  “The law requires funeral homes to give you written price lists.”
    • “You have the right to buy goods and services separately.”
  • Shop around. Because the law allows you to BYOC (bring your own casket), shop around. Where? Try Costco. While the NFDA says a casket averages $2,295, you can get a beautiful Costco casket for $950 — delivery included. But there are many other discount options online.
  • Get cremated. More Americans are opting for ashes. In 1960, only 3.6 percent did, but that had risen to 42 percent by 2011, says the NFDA. The Neptune Society, one of the largest cremation services, says its costs vary by “local market factors” but insists it’s “a fraction” of burial costs.

2. Weddings

Who doesn’t enjoy reading about “The World’s Most Expensive Weddings“? No. 1 is Prince William and Kate Middleton, at $34 million. While the average American wedding costs a fraction of that, it’s still $31,213, according to a survey by wedding website The Knot.

While everyone from Martha Stewart to us offers advice for saving on weddings, the truth is plain: Many brides refuse to skimp on their big day. So while buying from websites like PreOwnedWeddingDresses.com and limiting the floral arrangements and guest list can save thousands, many are going to eschew those steps.

Maybe these other cost-cutting suggestions will appeal:

  • DIY the DJing. The Knot survey says a reception band will cost about $3,000, while a disc jockey will run almost $1,000. But many couples, especially younger ones, are programming their own music on iPods and simply hiring someone (or even asking a friend) to push the right buttons at the right time. Search online for “DJing your wedding” and you’ll find all kinds of detailed advice.
  • Skimp on the cake. How many weddings have you been to where everyone exclaimed, “That cake was delicious!” Most attendees don’t care, and they only get a sliver, anyway. So don’t buy your wedding cake from a specialty baker. Buy it from your local grocery chain. Since the average cake runs $560, you can easily cut the price before you cut the cake.

3. Diamond rings

You’ll notice we didn’t mention engagement and wedding rings in the Weddings section. That’s because jewelry is an overspending category unto itself – and diamonds may be the most marked-up item on this list. But like funerals and weddings, buying diamonds is fraught with danger because it’s yet another emotional purchase. If we try too hard to save money, we feel like we’re being cheap.

But here’s a secret: Diamond prices are often negotiable, even at major chains like Zales and Kay Jewelers. So while it’s important to know the four C’s of diamonds – carat, color, clarity and cut – the biggest lesson you can learn is to haggle. If your local jeweler or national retailer won’t come down on price, they’ll often be willing to upgrade the setting for a discount or even free.

4. New cars

Money Talks News founder Stacy Johnson lives in a beautiful house on the water, and there’s a 30-foot boat docked out back. But he’s never, ever bought a new car. This is what he says:

When it comes to buying cars, the vast majority of people I’ve known over the years approach the subject with no imagination at all. They simply do what the commercials tell them to and what their friends do: trudge down to the nearest dealer and buy a new car.

Instead, he’s bought used cars for as little as $5,000. How? He avoids car lots. “A few years ago I bought a 1994 Cadillac Fleetwood Brougham from a 91-year-old lady,” he recalls. He suggests asking around – friends of friends seem to value a fair price and honesty. He also consults websites like Kelley Blue Book or Edmunds to establish a value. And finally, he gets the car inspected by a local mechanic. It might cost $50, but it can “save a ton of headaches and bills down the road,” he says.

But if you’re dead-set on a new car, consider more than the price. Also take into account resale value, fuel efficiency, repair record and the cost of insurance.

5. Food

So you don’t cook much or well, and you don’t have the time or space to grow your own fruits and vegetables. Since that sums up the advice in many saving-on-food articles, now what? Here are three quick and easy suggestions:

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