We all have that one friend who always seems to be broke, no matter how much they earn. You know the type—they make a decent income, but by the end of the month, they’re scraping by, wondering where all their money went. It’s not that they’re incapable of making enough to live comfortably, but something about their financial habits keeps them stuck in a cycle of being perpetually broke.
If you find yourself in a similar situation, it might be time to take a closer look at the habits that could be holding you back. While considering options like a debt relief program can help manage existing financial burdens, breaking free from these toxic habits is essential to achieving financial stability and, ultimately, building real wealth. Let’s dive into seven habits that perpetually broke people often have—and what you can do to avoid them.
1. Living Beyond Their Means
One of the most common habits of perpetually broke people is living beyond their means. This often manifests as spending more than they earn, using credit cards to fund a lifestyle they can’t afford, or constantly upgrading to the latest gadgets and fashion trends. While it might feel good in the moment, this habit is a surefire way to stay broke.
To avoid this pitfall, it’s crucial to create and stick to a budget. Track your income and expenses, and make sure you’re living within your means. Prioritize needs over wants, and avoid using credit to pay for things you can’t afford. Remember, financial success starts with spending less than you earn.
2. Ignoring Debt
Another habit that keeps people broke is ignoring their debt. Whether it’s student loans, credit card balances, or personal loans, avoiding debt doesn’t make it go away. In fact, it only makes things worse as interest accrues and the debt grows over time.
If you’re struggling with debt, taking action is essential. A debt relief program can be a good place to start, offering options like consolidation or negotiation to reduce your debt burden. The key is to face your debt head-on and develop a plan to pay it off as quickly as possible. The longer you ignore it, the more it will hold you back from financial success.
3. Failing to Save for Emergencies
Life is full of surprises, and not all of them are pleasant. Whether it’s a car repair, a medical emergency, or an unexpected job loss, failing to save for emergencies can quickly turn a small setback into a financial crisis. Perpetually broke people often have no savings to fall back on, forcing them to rely on credit cards or loans to cover unexpected expenses.
To break this habit, start by building an emergency fund. Even if you can only save a small amount each month, it’s important to start somewhere. Aim to save at least three to six months’ worth of living expenses, so you’re prepared for whatever life throws your way.
4. Impulse Buying
Impulse buying is another habit that keeps people in a constant state of financial struggle. It’s easy to justify a little treat here and there, but those small purchases can add up quickly. Before you know it, you’ve blown your budget on things you don’t really need, leaving you with nothing for savings or debt repayment.
To combat impulse buying, practice the 24-hour rule: if you’re tempted to make an unplanned purchase, wait 24 hours before buying. This gives you time to think about whether you really need the item and if it fits within your budget. More often than not, you’ll find that the urge passes, and you’ll be glad you didn’t make the purchase.
5. Neglecting Financial Planning
Perpetually broke people often lack a clear financial plan. They might know they need to save or pay off debt, but without a concrete plan in place, they drift from one financial crisis to the next. Without goals and a strategy for achieving them, it’s easy to stay stuck in the same cycle.
Creating a financial plan is essential for breaking this habit. Start by setting specific, measurable financial goals, such as paying off a certain amount of debt or saving a specific amount each month. Then, develop a plan to achieve those goals, and track your progress regularly. A well-thought-out plan will give you direction and motivation to keep moving forward.
6. Relying on Windfalls
Many perpetually broke people rely on windfalls—such as tax refunds, bonuses, or gifts—as their primary way of getting ahead financially. While it’s great to use unexpected money to pay off debt or boost savings, relying on windfalls is not a sustainable strategy. When the windfall money runs out, they’re back to square one.
Instead of waiting for a financial windfall, focus on building steady, reliable income streams and practicing good money management habits. Treat any extra money as a bonus, not a lifeline. Use it wisely, but don’t depend on it to solve your financial problems.
7. Surrounding Themselves with Bad Influences
The company you keep can have a big impact on your financial habits. If your friends are big spenders who constantly encourage you to go out, shop, or make impulsive purchases, it can be difficult to stay on track with your financial goals. Perpetually broke people often surround themselves with others who reinforce their bad habits.
To break free from this cycle, consider who you spend your time with and how they influence your financial decisions. Seek out friends and mentors who share your financial goals or who are already where you want to be financially. Surrounding yourself with positive influences can help you develop better money habits and stay focused on your long-term goals.
Conclusion: Breaking the Cycle
Being perpetually broke isn’t just about how much money you make—it’s about how you manage the money you have. By recognizing and addressing the habits that keep you stuck in a cycle of financial struggle, you can take control of your finances and work toward a more secure, prosperous future.
Whether it’s living within your means, tackling debt through a Debt Relief Program, or creating a solid financial plan, the key is to take action. By making small, consistent changes to your financial habits, you can break free from the cycle of being perpetually broke and start building real wealth. Remember, financial success isn’t about luck—it’s about the choices you make every day.
