5 worst habits of the poor keeping you from getting rich, Have you ever looked at your bank account balance and thought to yourself, “geez… how did that happen?” do you sometimes wonder where all your hard-earned money goes? Every month you seem to always have just enough… or have you ever been in an embarrassing situation in which your credit card got declined? In this article, I will share with you 5 bad habits of the poor keeping you poor. So that you can avoid these mistakes and realize financial success in your life.
A lot of people, no matter how much money you give them, they will always be poor. But the problem with these people is not that they have been destined to be poor no. Is just that they have adopted some bad habits of the poor that they do need to get rid of before their success will come. so here are some of the bad habits
1. Using Credit Cards (first habits of the poor)
The first habit keeping you poor is over-relying on your credit card, or in some cases “credit cards”. Love them or hate them credit cards are a fact of financial life. They make spending effortless, and they give you the possibility to buy things you would not have otherwise been able to afford. It is no wonder that Americans as of 2019, are in over $1 trillion of credit card debt.
We live in an economy that thrives on credit, our day to day lives are bombarded with advertisements and commercials persuading us to open our wallets and spend away money which we do not have. It is no wonder that so many people are stuck in this credit rut.
A recent study stated that the average American family is about $16,000 in credit card debt. Credit cards are a great thing to have, they come in very hand in emergency situations but they also give you the fallacy that you have more money than you actually do, which results in you spending money, you don’t actually have.
What to Do
A good rule of thumb when shopping is to always carry cash. When it comes to good spending, cash is always king. First, you will never spend more than you have in hand, and secondly, humans are naturally selfish creatures even when it comes to your own money, so use this to your advantage. When shopping with cash, we tend to be a lot more cautiously and wise with our money because we don’t like to give away nor spending money; that is the first habits of the poor.
Check Also:: How To Overcome Laziness
2. Spontaneous Shopping (second habit)
Yup, we have all been here, the other day, while I was doing my weekly shopping, I Impulsively found myself adding things into my shopping cart which I didn’t need. For instance, at the groceries and food sections in my local supermarket, I noticed a couple of great deals on items that weren’t on my shopping list, But because the deal was so good, I bought them anyway…A lot of consumers have fallen victim to this trick imposed on us by retailers.
According to a study conducted by slickdeals, on 2000 American consumers, it showed that consumers make about $450 worth of spontaneous purchases a month and an average of about$5,400 per year. Most of these impulse purchases going towards, food and groceries, clothing, households, and others. Making purchase decisions in the “spur of the moment,” often leads to buyer’s remorse later on.
Take a look at your house and you will probably find lots of products that you never really use. For instance, the exercise equipment in your garage, the gadgets in your kitchen cupboard, the cloths in your wardrobe and many more Items. These are just a few examples of things people buy impulsively, which you more than likely don’t need. This then begs the question, why do you impulsively buy things? Even when you don’t need them.
The fact of the matter is that your subconscious mind often drives your buying behavior, you can’t help it. The moment you notice a great deal, your eyes immediately lights up and correspondingly your minds starts yelling at you to get it before it’s too late or the product runs out.
This happens every time you notice a great deal, and subsequently retailers and manufacturers take advantage of this, to sell you more stuff.
What to Do
A good rule of thumb when shopping is to always, carry a shopping list with you, imagine it as the law, which you should never break. Also, cash is king; never carry a credit card unless you absolutely have to. And lastly don’t battle nature, you will always lose. Don’t go to the grocery store when you are hungry, leave home with a full belly. That’s habits of the poor no 2.
Check Also:: 10 Steps to Financial Freedom
3. Not Budgeting (third habits of the poor )
Humans are notoriously bad at this. Every year, schools, businesses, governments, sports teams, and many other organizations set yearly spending plans and targets. Only humans don’t do this for themselves. Budgeting is a powerful and effective way to get your finances under control by cutting costs and setting goals and limits.
What to Do
If you can clearly see the amount of money coming in and going out, you will have a much better understanding on how to manage and invest your money. Budgeting gives you the ability to prioritize your spending and to focus your money on things that are most important to you. Setting a budget and financially auditing yourself, will clarify exactly how much money you will have, or not have at months end.
It will also open your eyes to areas in which you may be overspending. Unfortunately, this is something a lot of people neglect doing which more than often results in them overspending and getting into debt. That’s habits of the poor no 3.
Check Also::: How to Achieve Success in Life Faster Than Others
4. Not Investing (fourth habit)
The road leading to wealth and prosperity that we were all brought up to believe, was to live a frugal life, save as much as we can, and live off the savings in retirement. Saving money is a great thing to do and is super important to amassing wealth; unfortunately, the road usually ends here for most people. You will never amass large fortunes by saving alone. You need to invest. That’s habits of the poor no 4.
I like to think of each dollar as a little worker, working hard for me and earning as much money as they possibly can. This is in essence the concept of investing. Instead of spending your money on things that lose value and will eventually end up in a land fill like cars, electronics, or designer clothing.
What to Do
Invest your money in things that will earn more money like stocks, rental properties, bonds or even a side hustle business. Through the power of compound interest, your assets will provide a steady stream of income and by investing that income it will produce even more income. These passive income streams will eventually be bringing in enough money for you to live off of without having to work a 9 to 5.
Check Also:: 10 Habits of Highly Successful People
5. Not tracking Your Expenses (fifth habit of the poor)
This goes hand in hand with the habits of the poor on number 3 budgeting. Keeping track of your expenditure and knowing exactly where your money is going is a massive financial eye-opener that can literally change your life. Imagine, knowing exactly where every single penny you’ve ever made went, imagine knowing and being able to pinpoint exactly where your last paycheck went. Just imagine having all this information at your disposal.
I never used to keep track of my expenses, to be frank, I found it hard and rather tedious. Keeping track of every single purchase you make in a day, is not for the faint-hearted. But one day while I was at the ATM doing my usual withdrawal, I noticed that my account was nearing the zero dollar mark and I was surprised and shocked because I couldn’t understand where all my money had gone.
What to Do
I asked myself “did my money somehow grow legs and ran away?” I couldn’t explain where it had all gone. So out of necessity I decided to give this tracking thing a shot, I was amazed at the results. Every night before going to bed, I would write down how much money I spent and what I spent it on. After two weeks, I started noticing a trend.
Check Also:: How to Invest With No Money: (Free Tips)
I realized I wasted money on the most trivial things I could easily do without. I noticed that I spent a lot of money eating out in restaurants and on take outs. I also noticed that I wasted a lot on clothing and shopping plus, online subscription services which I almost never use and a lot of other things… and I also noticed that I wasted way too much money on my girlfriend. Sorry babe… it is what it is… so anyway.
Tracking your expenses is something that you should definitely start doing. If you get nothing else from this list of bad habits of the poor, then get this, Track… your… expenses! I can’t stress this enough. This one simple habit can literally change your life.
So there you go “5 habits of the poor keeping you from getting rich”. I hope you learn something from these bad habits of the poor? Please comment bellow any of these habit you know that I couldn’t mention.