How to identify and avoid common money pits to save your hard earned cash


Nicola Arnold

If you've purchased a car, just mortgaged a new house or bought a fluffy new pet, you may be all too familiar with the unforeseen costs that sometimes arise. What sometimes seems like a great purchase in the spur of the moment can result in money pits that can lead to online loans if there is a cash flow crisis. Although surprises are sometimes pleasant, financial ones can be crippling to your budgeting and financial plans. When carried away in the excitement of buying something new, we sometimes forget to ask vital questions. The answers to these questions could uncover costs we may not have initially known about. On that note, finding out the financial implications of a purchase before going ahead with it may be a good idea.

This guide will help you identify common money pits. It will also show you how to avoid them or reduce the cost implications which will ultimately lead to more money in your pockets.


Getting around is essential for day to day activities. If you can afford it, driving is a convenient way to get the job done. However, it can be expensive. As with everything, owning a car has its pros and cons. One of the cons is that it can have endless unforeseen costs, especially for old and used cars. Some of these costs can include things like fixing internal issues, replacing broken parts, and fixing the exterior. You could end up spending more on repairing the car than you spent on buying it in the first place. A good idea may be going to a trusted mechanic and asking for a diagnosis of current and possible future problems in need of repairing. This will give you a good estimate of how much keeping the car will cost you.

Changing a flat tyre


Gardening is a great hobby as well as a rewarding activity. It can also easily zap your money when things go wrong. Losing plants for one reason or another, for example, is a common occurrence for people who own gardens. This sometimes happens as a result of disease, pests and wildlife. You cannot always foresee this, however, you could take preventive measures such as pest-control but that does not always resolve the issue. This shouldn't necessarily deter you from having a garden, however, you should keep money aside so that if such instances do arise so you will not be caught out.

Costly gardening mistakes

  • Ignoring soil quality: trying to grow high quality plants from a low quality soil
  • Poor light management: putting the wrong plants in the wrong place for the amount of light / shade they require
  • Incorrect timing: planting the wrong plants at the wrong point in the year
  • Over watering: drowning the plants when you just need to give them a little drink
  • Forgetting to mulch: depriving your plants of a whole host of nutrients


Having a pet can be a gratifying experience. Aside from them being great company, they can also liven up your home. Pets, however, can become a money pit as they come with many costs. Some of these include food, toys, frequent visits to the vet, treats, grooming, and furniture. There is also the possibility that your pet could become sick and need emergency treatment for diseases or other issues. In this light, it may seem as though maintaining a pet can have just as many expenses as a human. You should consider whether it's something you can afford in addition to your regular expenses before diving in.

"Pet costs can quickly add up"
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Starting a business

Starting your own business can be a fantastic idea as well as an exciting time in your life. It can also quickly go downhill if you don't look into possible future expenses along the way. Depending on the nature of your business, initial start-up costs such as buying equipment, rent, payroll, legal requirements and many other things can be costly. Because of your emotional and financial investments, it can be easy to keep pumping money out to keep the business alive. Running a business also requires the following of many rules and regulations. Breaking them could result in extra unforeseen fines and costs. Calculating the financial risks and creating a comprehensive business plan before starting could save you a truck-load of money in the future.


Buying a new house is a great achievement and one that can bring a sense of stability. It can also be financially destabilising when you aren't fully aware of all of the cost implications. The cost of the mortgage and utilities alone can become exhaustive, especially when you have a relatively big house. You may have initially thought you got a good mortgage deal with reasonable interest, but with time notice that the rate isn't so good compared to what's on the market. In this instance, you could look into refinancing in order to save more money. Aside from interest rates on your mortgage, buying a house that has quite a few structural issues could also result in it becoming a money pit. Size is also a factor in how much you'll be spending on maintenance requirements such as heating, furnishing, electricity, and even cleaning.

Home renovations

Whether you buy a brand new house or one that's a little on the shabby side, at some point renovations will be required. You might feel like you want to revamp the house and give it a new look or feel. On the contrary, you might be forced to fix the house up before it completely falls apart. Either way, it's going to cost you a reasonable sum of money. Calculating your costs and staying within your budget will ensure you don't go overboard. Unfortunately, you cannot always predict when the need for renovations will arise so this is how it can become a money pit. If the roof is falling in and the bathroom is flooding, those are expenses that can't be ignored but you also may not necessarily be able to afford.

Leaking pipe

Misusing credit cards

Credit cards, used responsibly, can be an appropriate tool for building your credit and managing your finances. The misuse of them, however, could lead to issues. Late and missed payments often result in extra charges. You could then end up paying far more than you expected in extra charges as well as interest.


A controversial topic but worth exploring. Many people are able to pay for university as a result of taking out student loans. Although the interest may be competitive, it is debt that many people find it difficult to rid themselves of. There are also other cost implications that you encounter while obtaining your degree such as books, accommodation, food, and travel. You may be able to save on some of these costs if you stay at home as opposed to on campus. Getting a part-time job could also help cut some of the costs.

Tips to avoid money pits

Just about every problem has a solution and that includes common money pits. If something you recently invested your money in has become a money pit, or you were considering investing in any of the things we mentioned here are some tips. They should be useful in both helping prevent a money pit as well as helping you get out of them.

Asking questions before making a somewhat long-term financial commitment will help you save a lot of money and hassle. If for instance, you intend on getting a pet, first ask someone with a pet what it's like. Find out what their monthly expenses are and how they manage them. Ask questions about how they fit the expense into their monthly budget and how often they find themselves encountering an unforeseen expense. You could also see what measures they take to curb certain expenses or what cheaper alternatives they may have come across. Your experience won't necessarily be the same as theirs, however, it will give you greater insight about what you're getting yourself into and how much you to need to set aside every month for both predicted costs and emergencies.

Carrying out research before making a financial commitment, might save you a large sum of money in the long-run. If you happen to want to take out a mortgage, for example, gather all of the information you need before making a commitment. Research the cheapest deals out there to ensure you don't end up overspending. Try and avoid making commitments based on impulse. Instead, opt for making informed decisions after checking out different options. This could help you dodge expenses that could have been avoided had you taken the time to look for a more cost-effective alternative.

If you happen to be buying a new car or house, try and get it in the newest condition as possible. This may sometimes seem more expensive initially, but it could save you tons of money in the unforeseen future. Making financial commitments to things that aren't in the best condition could result in you spending far more than you purchased it for. These expenses will usually come in when you have to repair and replace things. If you do insist on getting things that are fairly used, make sure you evaluate the cost of fixing it up before buying to see if it is truly worth it.

Sometimes when you commit to something, you want to see it through to the end, however, this isn't always the best option. Know when it may be time to let go, and that is usually when you've almost depleted all of your money. To avoid online loans at the end of the month, set yourself a limit beforehand. Try and ensure you set yourself a realistic budget and you don't go over it. You can start by listing out all of the known costs and coming up with a round figure. Once you've done that, include an emergency figure based on your research and the questions you've asked regarding any hidden costs. As a rule of thumb, try not to put more into a purchase than it is worth.

Sometimes things you've purchased such as cars or mortgages can be exchanged or traded in. If this is possible and your commitment is becoming financially exhausting, it might be worth doing. Instead of getting rid of it altogether, look for a cheaper alternative. This might mean trading it in for something less expensive or adding some money to buy something brand new that won't have as many money pits. For example, if you have a big house, you could think about downsizing and perhaps get something smaller and more affordable. Whatever the case, weigh out the costs so that you stop spending hard earned cash on unplanned expenses.

The truth of the matter is that no matter what precautions you may take, sometimes money pits come about unexpectedly. The final resort, in this case, is usually to get rid of it before it completely destroys your finances. It is sometimes hard to part with something that you had good intentions for, but if it's financially stressful it may be best. By selling it (if that is an option), you may be able to get back a fraction of the money you've invested in maintaining it. If it cannot be sold, cutting your losses will enable you to spend your money in other areas.

Avoid it

At the end of the day the best way to avoid a money pit is to stay clear of it altogether. Learn that is ok to not have everything and sometimes waiting to see if you really need something before buying is a good tip.


Money pits can be avoided if you take the time to adequately plan ahead. A long-term financial commitment should be something that you plan for and not something that catches you unaware. By asking questions, doing your research and effectively budgeting, you should be able to avoid throwing your finances off course due to a new acquisition. Hopefully, this guide has given you more insight into common money pits and how best to identify as well as avoid them. Next time you're tempted to make an impulsive buy, ensure you first weigh out the costs.

The more research and due diligence you do before investing in something can avoid a money pit and stress on your finances. This stress may lead to bad credit loans.