The 10 Biggest Money Wasters in Germany: Your Guide to Saving Thousands Annually
Wasting money in Germany? We expose the top 10 ways you're losing thousands every year without even knowing it! 💸
Key Takeaways
- Germans waste thousands annually on everyday mistakes. This guide exposes the top 10 to help you save more.
- Small, recurring fees for unused services add up; regularly review and cancel what you don’t need.
- Habits like smoking or gambling not only harm health but also destroy potential long-term wealth through missed investments.
- Wasting food and overspending on convenience and branded products can cost you thousands yearly.
- Emotional spending on non-essentials can waste a significant portion of your income.
- Overpaying for too many or the wrong insurance policies is a major financial mistake in Germany.
- High fees and inaction on savings accounts can cost you thousands in lost returns.
- High-interest loans for consumer goods are a serious wealth killer and should be avoided entirely.
- Increasing your spending with your income delays financial goals and burns through potential savings.
- Rent, utilities, and car costs are the biggest expenses, often consuming over a third of your budget.
You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More InformationFrom Subscriptions to Rent: Where Your Money Disappears in Germany
Schwaben is a region in Germany where people are famous for their extreme frugality—they’ll even cut open a tube of toothpaste just to squeeze out the very last drop. While that might be a bit of an extreme example, what if we told you that you’re likely wasting THOUSANDS of Euros every single year without even realizing it? The average person in Germany wastes almost €9,000 annually just by making common, everyday financial mistakes. Are you one of them? You’ll find out in this article.
We’ve created a realistic ranking of the 10 biggest money wasters in Germany, which are far more significant than simply cutting open a tube of toothpaste. This guide is designed to help you identify these financial leaks and plug them, so you can redirect that money toward your savings, investments, and long-term financial goals. We believe that true financial freedom starts with awareness, and that’s what this guide is all about—shining a light on where your money disappears so you can take back control.
#10: Subscriptions & Memberships (€200 - €500/year)
It all begins with subscriptions and memberships, a money waster with an estimated annual cost of €200 to €500. We’re talking about things like Netflix, Spotify, Audible, gym memberships, cloud storage services—the kind of expenses that seem small and harmless on their own but add up incredibly fast. There is absolutely nothing wrong with paying for subscriptions that you actually use and enjoy. The problem is when people continue paying for things they no longer need or have simply forgotten about. Think about that old club membership you stopped going to, an app you forgot to cancel after a free trial, or a BahnCard that automatically renewed because you missed the deadline.
We also can’t talk about this topic without mentioning the infamous online subscription traps—shady services that sneak in recurring charges after a “free” trial. While German courts have ruled that unclear pricing makes these contracts invalid, many people still get stuck in these billing cycles for years. To protect yourself, make it a habit to regularly review your bank transactions and immediately cancel what you no longer use. Every single Euro saved counts toward your financial goals.
You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More Information#9: Addictions & Vices (€400 - €1,500/year)
A more personal and often underestimated money waster is addictions, with estimated costs ranging from €400 to €1,500 a year. Whether it’s smoking, drinking, gambling, or compulsive online shopping, these habits don’t just hurt your health—they also seriously hurt your wealth.
Let’s take smoking as a prime example: one pack of cigarettes costs around €10 these days. If you smoke one pack a day for 40 years, that adds up to over €100,000 spent just on cigarettes. But that’s not the complete picture. If you had invested that same money instead of smoking it and earned a modest 7% interest per year, it would grow to almost €600,000. That’s a staggering amount of potential wealth literally going up in smoke.
We understand that these habits can be difficult to break, but understanding the true financial impact can be a powerful motivator. The money you save can be used to build your financial future, and that freedom is a far greater reward.
#8: Food & Groceries (€600 - €1,800/year)
Next up is the second-biggest cost block for most people after housing: food and groceries, with an estimated €600 to €1,800 wasted every year. The average household in Germany spends over €400 per month on food, drinks, and tobacco. Ordering food from delivery services, buying expensive branded products instead of generic ones, and grabbing a daily coffee on the go—it all adds up incredibly fast.
And worst of all is food waste. Germans throw away more than 78 kilos or about €250 worth of food per person every single year. Want to cut costs? The solution is simple: plan your meals in advance, cook at home more often, and compare prices at the grocery store. You don’t have to sacrifice quality to save money; even small changes in your shopping and eating habits can save you hundreds of Euros annually.
#7: Impulse Purchases (€1,000 - €2,000/year)
Speaking of everyday habits, let’s talk about impulse purchases, the next money waster that can cost you €1,000 to €2,000 a year. Whether it’s grabbing snacks at the checkout counter, late-night online shopping scrolls, or being enticed by “limited time” sales, studies show that up to 50% of our spending can be impulsive. This is no coincidence; stores are expertly designed to trigger emotional buying. They use music, lighting, and strategic product placement to encourage you to buy more.
Online shops take this even further with features like one-click orders, personalized recommendations, and push notifications that make it incredibly hard to resist. The best way to protect yourself from this trap is to create a spending delay. Give yourself at least 24 hours—or even 48 hours—before buying anything non-essential. That gives you the chance to sleep on it and reflect on whether you truly need what’s in your cart right now. More often than not, the urge to buy will pass, and you’ll save your money.
You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More Information#6: Unnecessary Insurances (€1,000 - €2,000/year)
While impulse buys are a direct money drain, the next money waster is more hidden and often much larger: unnecessary insurances. Many people in Germany are overinsured, paying for too many, too expensive, or simply useless policies, wasting between €1,000 and €2,000 every year.
On average, each person in Germany holds six insurance contracts, but here’s the golden rule for your financial health: only insure what could financially ruin you. That means things like personal liability insurance, disability insurance, or term life insurance if you have dependents. You can’t afford to pay for a lifetime of lost income or a legal claim that costs hundreds of thousands. But things like glass break insurance, smartphone coverage, or baggage insurance are rarely worth the money. A broken window or lost suitcase is an inconvenience, not a financial disaster.
If you’re not sure what you actually need or what can be improved, we offer a free PerFinEx Contract Check. We’ll help you find out if you’re protected in the right places or just burning money with the wrong insurances.
You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More Information#5: Investment & Bank Fees (€3,000+/year)
The next money waster, investment and bank fees, can easily add up to over €3,000 a year. Account maintenance fees, transaction charges, ATM withdrawal costs—banks find plenty of ways to make you pay for their services. If you’re still paying for your bank account, it’s time to switch to a free one. A few minutes of effort can save you hundreds of Euros in fees every year and even earn you up to €100 in welcome bonuses when you sign up through our calculator.
But it can get even worse, because missed investment opportunities are one of the biggest wealth killers of all. If you leave €20,000 sleeping in a 0% interest savings account for 20 years, inflation will shrink its purchasing power to less than €15,000. But if you invest that same money at a modest 7% annual return, it could grow to almost €80,000. That is the incredible power of compound interest, and that difference is the true cost of doing nothing.
#4: Consumer Debt & Overdrafts (€1,000s/year)
Now let’s talk about something even more dangerous than high fees: consumer debt and overdrafts, which can cost you thousands of Euros every year. Let’s say you buy a new €1,200 TV on an installment plan. “Get it now, pay later”—sounds awesome, right? But with a 12% interest rate over five years, you’ll end up paying over €1,600 for it just to watch Netflix.
We used to think this was a typical “U.S. problem,” but it’s not. Eight percent of adults in Germany have consumer loans, and for those under 30, that number jumps to a record high of 20%. The golden rule for financial freedom is to never take on debt for consumer goods. Instead, build an emergency fund so you never have to borrow to buy. Because every borrowed Euro today is a Euro your future self has to pay back, with interest.
#3: Lifestyle Inflation (€5,000+/year)
From consumer goods to something even more tempting: lifestyle inflation, which can statistically burn up to €5,000 a year. You get a raise at work, and suddenly it’s a new phone, a long weekend in Barcelona, or dinner out three times a week. It might feel like you’re upgrading your life, but what you’re really upgrading is your expenses.
Spending money is fun, and every now and then you absolutely deserve a treat. We get that. But set clear spending limits and don’t let “treating yourself” be the reason your savings goals get delayed by years. More income should mean more freedom and security, not more bills and debt.
You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More Information#2: Car & Mobility Costs (€1,000s/year)
Before we get to your single biggest spending block, let’s talk about the number one wealth killer of all: car and mobility costs. The average household in Germany spends over €340 per month just to stay mobile. And if you own a car, those costs can easily be double or even triple that.
This doesn’t even include the biggest hidden cost: depreciation. A new car can lose HALF its value in just the first three years. So, if you’re wondering whether to buy, lease, or finance a car in Germany, we have a video on that topic. It’s an important decision because the money you save can be used to invest and build real wealth.
You are currently viewing a placeholder content from YouTube. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
More Information#1: Housing Costs (€1,000s/month)
And finally, the biggest spending block of all: housing. It’s not just a roof over your head; it’s the single biggest money waster in most people’s budgets. In Germany, households spend on average over €1,000 per month on rent, heating, electricity, and maintenance. That’s more than a third of all household spending, and for many people, it’s even more, especially in big cities or if you live alone. And with energy prices rising sharply in recent years, utility bills have become an even bigger burden.
If you want to save, here’s our advice: heat your home efficiently, compare utility providers, and fix the little things that waste energy. When it comes to housing, don’t move more than necessary, as rent tends to increase with every relocation. And before you buy a home, make sure it’s truly the right financial move. If you’re not sure whether renting or buying is better for your financial situation, you might want to check out our article on that subject right now. Thanks so much for reading, and bis zum nächsten Mal!