6 Money Habits That are Keeping You POOR (Broke BROKE)

There are money habits that are keeping you poor and this article we will share some of the money habits I personally had to adopt and implement in my own life to get to the point to where I am today.

Money can be a source of happiness, comfort, and security. But for many people, money is a source of stress, anxiety, and sometimes even depression. The sad truth is that many people are poor not because they don’t have enough money, but because of bad money habits.

My story is a bit different than most, because I was raised by a single immigrant parent, never had anyone teach me finance so I had to learn it on my own and have probably tried every side hustle on earth.

Growing up my habits and my relationship with money were way different than my habits today. And although my mom tried her very best, she didn’t teach me the proper money habits that would allow me to do well in life when it comes to money. And that was a result of her parents not having good money habits and just passing that down to her.

Your daily money habits will shape your financial success. Our daily spending and money management habits ultimately decide our future. There are 2 roads that we can travel on, one will lead us to financial stability or wealth, and the alternative could lead us towards being poor financially.

I wanted to take the time to share the money habits that really transformed my finances and gave me the ability to make even more money.

First habit is something that involves how you currently think of money and your relationship with it.money

Scarcity Mindset

I wanted to start here because it will be the foundation for all the other habits you decide to change.

Scarcity mindset believing that there’s never enough of anything to go around. And you think that money is a very limited resource. When in reality its something that can be printed and created out of thin air.

And the thought of money leaving you creates the feeling of anxiety and stress.

And it’s easy to get caught up in this mindset especially if you didn’t come from much. Imagine someone, who has never had any money in life, finally come across money and ultimately decide to hoard it and protect it with their life, because they believe in their subconscious that they won’t be able to get that money back again.

Instead, identify whether you have the scarcity mindset and work to rewire your thinking of letting your money control you and start taking control of your money.

I never had too much of an issue with this myself, but here are some ways to tell if you have a scarcity mindset.

You don’t set ambitious goals for your finances.
You have a hard time giving to people without expecting it back.
You avoid looking at your bank account.
Scared to invest and would rather keep saving.

In my experience having a scarcity mindset is having a unhealthy relationship with money and that will prevent you from truly growing your finances if you continue down this road.

So, to get out of this mindset, you can start exercising small habits of investing. Maybe find an item at a garage sale to flip or invest in a share of a stock.

You can give to others in need or pay for the person behind you in the Starbucks line.

Create a habit of letting your money be active and send it out into the world so that it can bring you back some more of its friends to hang out with, in your bank account.

Next habit is…

Paying off Predatory scam credit cards….… Wait.., what’s that?… Oh, that’s what its called? Oh sorry, next habit is…

Paying Off High Interest Debt

Accumulating debt is one of the most common money habits that can keep you poor. Credit card debt, personal loans, and other forms of borrowing can add up fast, and the interest rates on these can make it difficult to pay off.

If you want to break this habit, you can start by creating a debt repayment plan. Make a list of all your debts and prioritize them based on their interest rates. Prioritizing the highest interest rate debts first and work your way down the list.

If you have credit cards with open balances, instead of paying the minimum, try allocating your excess funds every month to get rid of the debt balance you have on these credit cards. The interests rate your paying on these are in excess of 20%.

You may need to do some shifting in the way you handle and spend money every month. Which includes everything from budgeting, cutting expenses and then taking the excess from that and applying it to the current high interest debt that you have.

If you have any high interest debt such as credit cards, the best thing you can do is pay off the balance as fast as possible. I mean these companies are making a killing with a 20% return on the debt they are letting you borrow.

You could be using the money you are throwing away to these companies, and either invest or save it.

Here’s how you can avoid this bad habit.

Avoid using a credit card in this first place. Most of the time, consumers use credit cards on wants and not necessities. Try to avoid using them if you can.

If you do decide to use it, then ensure that it’s something you can pay off quickly, preferably within the month. And get that balance down to zero again.

Again, if you have multiple credit cards, then pay off the highest interest rate card first and then the next and the next.

The next habit we should talk about is around.

Increased Spending in relation to your Increased Income

A habit that can prevent you from ever growing in your finances is increasing expenses in relation to your increased income.

Nothing’s wrong with spending money on yourself from time to time, but spending money before even having it, like many do waiting for their tax refund check, isn’t a healthy habit that will serve you well.

When managing money, we want to do the opposite, remove unnecessary expenses, and increase investments and savings.

A lot of people seem to think that as soon as they come across a surplus in some money, whether it’s a raise at their job, a tax refund check or whatever event happened that gave you some extra cash.

They immediately think about how they can spend it. Instead, this is a perfect opportunity to pay off the high interest debt we talked about earlier.

The next habit that may be keeping you poor is…

Not Saving

Saving money is something that will benefit your bank account, but most importantly is a sign that you are taking all the other steps needed to be able to save in the first place.

You are living below your means and actively setting the money aside for your financial future.

Start by setting aside a portion of your income each month for savings. Even if it’s just a small amount, it’s better than nothing. You can also automate your savings by setting up a direct deposit into a savings account as well if that is better for you.

Saving shows that you are practicing some good money habits, but there are levels to this. Saving too much money for too long isn’t serving you well. It’s getting consumed by inflation and could be used for the next habit, that you may not be doing, that is keeping you poor and that’s…

Not Investing

This is a habit that changed my life. Putting your money to work for you is an absolute game changer. I remember watching my mom start a deli business, and even though it ended up failing, it showed me that it’s important to take some risk and put your money to work.

I know I mentioned how growing up I never was taught good money management skills, but taking risk and starting a business is something that I witnessed my mom try to do, a few times.

If you have ambitious goals for your finances, then investing is something that you will need to do.

Investing is a no brainer for building long-term wealth and achieving financial freedom. If you are not investing your money, you are missing out on all the benefits that come with it.

Like multiple streams of income, planning for retirement, building wealth, staying ahead of inflation and ultimately letting your money do the work so that you can grow financially.

You can start by researching different investment options such as stocks, bonds, mutual funds, real estate or even starting a business or side hustle. Choose an investment vehicle that fits your goals and risk tolerance.

I talk a lot about different ways to invest and make money on this channel, so make sure to check those videos out to see what resonates the best with you.

The next habit is…

Not Educating Yourself About Personal Finance

There are plenty of free resources on personal finance. Make it a habit to learn something new that you didn’t know before.

Money problems are common for those who did not take the time to gain knowledge about money. Not learning and educating yourself about money can lead to increasing debts or having poor spending habits.

The lack of knowledge about money can also lead to poor credit, bankruptcy, housing foreclosure, and more.

Most people when they think about money believe it’s a very simple concept. It’s something that you earn and something that you spend. But there’s a lot more to money than earning it and spending it.

And the best way to offset this thinking is by taking the time to learn.

This means you would take an active role in ongoing learning about budgeting, investing, debt payoff, how to leverage debt and concepts like, time value of money, compound interest and your financial planning for your future.

Doing this will drastically change how you view and use money.

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