9 Bad Money Habits Keeping You Broke
Do you have bad money habits keeping you broke?
There might be some habits that you have that are preventing you from making and saving more money and you don’t even realize it!
People with a healthy financial life have mastered the art of cultivating good habits, ones that naturally lead to an improved financial lifestyle.
Read of some of these bad money habits below, and see how many you’re guilty of.
A more promising bank account may be within easy reach if you change a few of your ways!
Let’s get into it…
You’re Too Loyal To Your Employer
People do rightly value loyalty, but it’s not something that should be shown at all times. Show loyalty to your friends and family, yes! But to your employer? It’s probably best if you didn’t.
People who move companies typically earn more money than the ones who stick with just one.
You’ll of course want to be loyal to a degree to those companies who have been good to you, but just be aware that you’ll be doing damage to your bank account if you stay too long.
In fact, there are many studies including this one by Forbes that state that you will get paid more if you change companies rather than sticking with one employer.
To be fair, there are other factors to include like benefits, work-life balance, commute, etc… so just weigh it out to see which is the best option for you.
Take interviews for other companies and see what they are offering, it doesn’t hurt to look around.
This is one of the bad money habits keeping you broke, so look out for yourself first, not your employer.
Change can be hard but it’s a necessary step to make more money!
You’re Not Topping Up Your Skills
The world is moving pretty quickly – some would say too quickly, which means that new skills are always in demand.
Even if you left formal education only recently, some of the skills that are required in the job marketplace might be alien to you.
If you want to earn more money, then you need to be routinely topping up your skills, even if that means paying for the course yourself.
This advice is more relevant in some industries than others, but there aren’t many careers that can’t be helped by having a few more up-to-date skills on the resume.
If you are not constantly learning and improving your skillset you will be left behind and will not make as much as you can.
Plus, it’s possible that you can even be replaced by someone who has some newer skills so this is definitely a must-do!
You’re Too Generous With Gift Giving
Many people spend way too much during holidays and special occasions when they really don’t need to!
Suddenly, all that budgeting we did for the rest of the year goes out of the window, and we go hog wild when it comes to buying presents.
While this doesn’t really prevent you from making money, it’s something that costs you a lot of money.
I’m not saying to stop giving people gifts, just dial it back a bit.
There is no need to buy expensive jewelry or designer items if you are not in a good financial standing to do so.
The pressure to buy sack loads of gifts can be strong, but it can also be resisted.
In fact, many people are perfectly fine with a cheaper and more thoughtful gift so there is no need to spend a lot of money to make people happy.
You’re Too Nice
We live in a country where there are consequences for our actions.
If you’re injured and it wasn’t your fault, then there are two options: you’ll suffer, or you won’t.
Some myths are surrounding the personal injury legal process, and one of the biggest is that the person you’re suing is going to pay for the damages out of their own pocket.
In most cases, this is not the case.
So don’t avoid getting what’s rightfully yours just because you don’t want to cause another person any hardships; they’re unlikely to have any anyway.
In simple terms, you shouldn’t let anyone take advantage of you!
For example, if you are working don’t let your co-workers push all the grunt work for you. Know your worth and make sure you are being paid for the amount of work you do.
There are many cases where employees take on more work beyond their job duties and they don’t get a pay increase for the increased workload, don’t let this be you!
It’s definitely okay helping people out here and there but you should definitely be compensated for your work.
You’re Not Diversifying Your Income
How many sources of income do you have? If the answer is one, and that’s your salary, then it’s time to rethink your approach to building wealth.
While solely relying on your income is the easiest option, it is not the best.
You should be investing some of your wages, thus diversifying your income.
If you can get into the property market, then all the better. In any case, aside from losing potential wealth, the problem with having all your eggs in one basket is that if you were to lose your job, you’d be in major trouble.
You should definitely invest as much money as you can to increase your wealth!
To invest in the simplest way possible I recommend checking out Wealthfront which is an app that uses special algorithms to invest your money for you in the best way possible.
If you want to invest in individual stocks then I recommend checking out Robinhood and Webull.
Plus, when you sign up to Webull and Robinhood using my links you will get free stocks from both platforms!
To invest in real estate you can physically purchase properties or the easier route is to invest in REIT’s which are stocks that track the real estate market.
Lastly, you can invest in cryptocurrencies that are at higher risk but can have a higher reward. If you want to invest in cryptocurrencies I recommend checking out Coinbase.
Plus, when you sign up to Coinbase with my link and purchase $100 of any cryptocurrency you will get $10 worth of Bitcoin for free!
You’re Guilty of Lifestyle Inflation
One of the bad money habits keeping you broke is lifestyle inflation!
Lifestyle inflation means that as you make more money you then purchase unnecessary items to upgrade your lifestyle.
For example, let’s say you make $25,000 a year and you spend $20,000 a year. In this scenario, you are saving $5,000 a year.
Now, let’s say you got a new job making $40,000 a year but instead of keeping your spending at $20,000 a year you start spending more and increase your spending to $35,000 a year.
So, you are still only saving $5,000 a year which means you are essentially still in the same spot financially!
This is why many people who have well-paying jobs end up having financial difficulties; they’re not saving anything!
You can treat yourself to a few new treats when you get a pay rise, but those treats shouldn’t account for all the new money you’re getting each month.
As you make more money, you should focus on saving and investing your money to grow your wealth!
This is one of the most common bad money habits keeping you broke so definitely don’t give into lifestyle inflation.
You’re Surrounding Yourself With Naysayers
Let’s say you’ve got an idea for a business. If you could get some money behind you, then you could have a viable, profitable business.
Alas, you mention it to some friends and family members, and they’ve all convinced you it’s not worth pursuing.
So you give up…
Who knows where it might have led? We’ll never know.
If people are constantly putting your ideas down, leave them behind.
It takes guts and positivity to start a business, and you can’t have people pulling you down when you’re trying to build something for yourself.
However, this doesn’t only apply to starting a business. It could be that you want a career change, lifestyle change, investing, etc…
There are even times when people try to be more frugal to save money and other people tell them that it’s not good to be cheap and they should enjoy their life.
The simple fact is that when you break out of the “rat race” and the conventional way of doing things, you will get negative feedback from a lot of people.
However, the good thing is that you don’t need to stick around them! If you have negative people in your life just distance yourself from them.
With the power of the internet, there are communities for just about anything and if you want to improve your financial lifestyle then there are awesome personal finance communities you can be a part of.
Surrounding yourself with negative people is one of the worst money habits keeping you broke so surround yourself with like-minded people that can lift you up!
You Don’t Know How Much You Spend
Be honest. Do you know how much money you’re spending each month?
And I don’t just mean on rent, food, and bills…
I am also talking about those purchases that we often look over like coffees, movie tickets, and other luxuries.
Keep tabs on your expenses for the next month, and you might find that you’re spending far more money on things you could cut out of your life than you realize.
Get rid of them forever, and put all that money into your savings and investments.
If you are tired of being broke then you need to make some sacrifices to cut costs and save money!
There are many people who make a good amount of money but still feel broke because of their bad spending habits.
Start tracking your expenses and set a budget for spending. You can use apps like Mint or Personal Capital to do the bulk of the work for you.
Making money is not the only thing you should be focusing on, you should also focus on ways to save money.
You’re Not Pushing Yourself
Lastly, a bad money habit that most people have is not pushing themselves hard enough.
This can just be a bad life habit because it goes beyond money but it’s a habit that affects your potential earnings greatly!
People want to have fun, socialize, and so on, but if you do all of those things, then you won’t have the time or energy you need to become a high earner.
You can’t have everything in life, so eventually, you’ll have to decide in life to either have a healthy bank account or have a nice and easy life.
I’m not saying that money is the most important thing ever and it’s the only thing you should focus on in your life but if you are looking to make more money then you are going to have to work for it.
We all know money doesn’t come easy, so you have to push yourself to advance in your career, get a new job, start a business, etc…
Start making the necessary changes, and you’ll be on your way to boosting your income in no time!
These are 9 bad money habits keeping you broke!
As mentioned earlier, habits can make you financially successful or broke. People who are considered successful in a monetary sense have good money habits.
If you find yourself with bad money habits then you should work to replace the bad habits with positive ones.
Did you like this post? If so, I recommend checking out my posts on Tired Of Being Poor? Here’s What To Do and 9 Financial Literacy Topics You Need To Learn About!
Have any other bad money habits to add? Did you overcome any bad habits? Let me know in the comments below!