How habits keep you poor

Habits are what can make or break us if we do not give them proper attention. Unfortunately, money habits are some of the most forgotten and underestimated habits yet they are also some of the most important.

Because of this lack of attention given to money habits, they are often passed around from generation to generation. This is one big reason the rich get richer and the poor get poorer. The wealthy do focus on their money habits while the middle class and the poor sweep them under the bed and try to not think about it.

One of the most common bad habits that plague the poor and middle class is called lifestyle inflation. This is when you spend more as you make more. This habit has a lot of issues with it and is also deeply rooted in American society making many people see it as “normal”. This habit is the reason almost half of Americans making over $100k are still living paycheck to paycheck.

Not only is this habit detrimental to your financial well being it is also selfish and does not bring happiness in the long run. Humans almost always return to a regular level of happiness after extreme good things or bad things happen, this means if you buy a brand new fancy car within just a few months you will be just as happy as you were before you got that car.

Financial habits are especially hard to break because people do not confront them the same way they would with other bad habits. We also do not talk about personal finance enough to correctly establish when we have bad habits in our own lives. That said we need to learn to identify bad habits on our own in order to live a financially healthy life.

Different bad financial habits

There are dozens of bad financial habits that people have and it would take forever to go over all of them, but I do want to go over some of the most common out there. Here is a list of some of the biggest poor financial habits…

• Avoiding financial education: Talking about finances can stress some people out and bring up bad feelings about one’s self.

• No emergency fund: This is one of those habits that keep people in deep poverty and crippling debt. Without an emergency fund, many need to go into debt when emergencies inevitably happen.

• Not saving: You need to be saving a specific percentage of each paycheck (10-30 percent) every paycheck. You do not even need a specific reason to save but trust me you will be glad you chose to save in the long run.

• Ignoring debt: This is another one that brings people intense emotional pain. Our brains are wired to avoid pain and the easiest way is to ignore our problems but that just causes them to get worse and worse

• Impulse spending: This one is big, especially among young people. If you see something you want just wait 24 hours to see if you still want it, in most cases you will not.

• Not budgeting: This is one of the most important steps to breaking other bad financial habits. Without budgeting you can be financially ruining yourself without even knowing it.

Now that we know some of the worst habits that are keeping you poor let’s just quickly talk about how to break these habits.

• Budget: Budgeting is often seen as optional. IT IS NOT OPTIONAL. You need to budget and plan for every paycheck and every month, this is a requirement for everyone.

• Face your issues: Most financial issues just require you to face them. If you truly struggle to face your own financial situation it might mean you need to get professional help because not being able to face your problems is a mental illness.

• Shift your mindset: Most people have a mindset of blaming others or the economy for their financial struggles but in reality, they have no one to blame but themselves. Realize that you are in control of your life and not anyone else.

In conclusion, you NEED to budget and face your issues yourself. No one will fix your financial situation for you and not fixing your own situation is selfish and will harm you and others in the long term.

How to break the cycle of poverty

The cycle of poverty is more than just bad financial habits being passed down from generation to generation, it is more bad habits that have turned into a culture that is not just passed down but expected.

Because of this culture of bad habits bad situations are also passed down. With a combination of other poor choices and shattered family lives the cycle of poverty can seem almost inescapable from the inside. So how do you actually break this cycle?

The short answer is to leave, leave the situation that has caused this, leave the culture that perpetuates bad habits, and leave the people who are holding you back. It is not easy but will make you and your family feel much happier and more secure in the long run.

The issue with people stuck in poverty trying to break the cycle is that they believe the answer to escaping poverty is making more money. The answer in truth is changing your situation to a situation that promotes good financial habits rather than poor financial habits.

People in communities full of poverty will win the lottery and still end up back in poverty. More money does not fix anything if you do not have good financial habits and a good financial understanding. The key is to learn financial literacy, learn about investing, and learn how those who are not stuck in poverty manage their money.

Being in poverty is not one’s fault but it is their fault if they do nothing to change their situation and follow the same ideas that got their family into poverty in the first place.

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