by Lee Flynn

Make no mistake; the world wants your money, and will do just about anything to get it. Unfortunately, that means there are countless organizations out there actively laying money traps designed to ensnare you financially. Of course, the best weapon  you can have to protect yourself and your wallet from these pitfalls is knowledge. By knowing what to look out for, you’ll be better prepared to deal with any hazards you encounter. Here are seven common money traps you should be aware of.

1. Convenience fees

This one sounds like an oxymoron, doesn’t it? After all, what could possibly be convenient about fees? Whenever you use a credit card, or make an online purchase, be aware that you may end up paying extra in convenience fees (AKA service charges, service fees, etc.). Be sure to keep an eye open for any additional charges before you finalize your transaction.

2. High gasoline prices

When was the last time you filled up your tank without flinching? Gasoline prices are high enough already, and the fact is that they’re only going to continue to climb. The good news is that by finding another method of transportation, you can save substantial amounts of money. Consider walking or biking to nearby locations, or rely on public transportation. If you do need to use the car, be sure not to gas up between Thursday and Sunday, as prices generally climb in anticipation of weekend travel.

3. Return policies

Some retailers are great about accepting returns, no questions asked; others, not so much. Whenever you make a purchase, be sure to familiarize yourself with the return policy. Most stores are happy to take back an item in good condition, as long as you have the receipt. Others may institute a return deadline, or only offer in-store credit. Others still may charge a restocking fee or simply not allow returns at all. If you’re not sure about the return policy where you shop, ask to speak with a manager.
[Editor’s note: Be especially careful when purchasing clearance items.  Some stores’ return policies are universal, while others treat clearance items as “final sale.”]

4. Refinancing

For large loans such as homes or automobiles, it’s sometimes a good idea to refinance, such as in the event that interest rates plummet or your credit score improves. However, often enough those who choose to refinance a car or a house do so shortsightedly. They see that by refinancing, they’ll have lower monthly payments. Unfortunately, the cost of those lower payments is often an extension to the life of the loan, and that can mean a much higher cost in the long-run.

5. Buying a car

It’s not uncommon to receive notices in the mail from dealerships promoting huge discounts on their lots. While these are helpful in seeing how willing different dealerships are to drop prices during negotiation, it’s no guarantee. Dealers often try to find customers through direct mail list brokers, television, and other mediums. But no matter how friendly the salesman at the dealership may be, their only purpose is to get as much of your money as possible. To this end, he’ll do everything in his power to up-sell you on your vehicle. Be sure you know exactly what you want in an automobile, and don’t let anyone talk you into unnecessary extras. If you’re in the market for a pre-owned vehicle, consider avoiding the car-lot all together. By working directly with a seller, you may be able to get a significantly better price.

6. Cable and Telephone lines

If you’re paying every month for cable and telephone lines in your home, you should take a moment to reconsider. Do you have a cell phone? How about high-speed home internet? If you answered yes to both of these questions, then having cable and a home line may be somewhat redundant. Consider making your cell phone your primary phone, and ditching your cable in favor of online streaming options.

7. Credit cards

Credit cards are great for emergencies. What they aren’t great for is day-to-day spending. By making frivolous impulse-buys on credit, you end up paying much more in interest. Even worse, you could potentially damage your credit score. Beat the desire to spend money you don’t have by leaving the credit card at home. That way, when you absolutely need it, it will be available; it just won’t be staring you in the face every time you open your wallet.