5 Habits Keeping You Poor 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 video, I will share with you 5 habits keeping you poor so that you can avoid these
mistakes and realize financial success in your life.
Habit 1: Using credit cards The first habit keeping you poor is over relying
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.
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 then 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 give away nor spending money.
Habit 2: Spontaneous Shopping 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
great deals on items which weren’t on my shopping list, But because the deal was so
good, I bought them anyways…
A lot of consumers have fallen victim to this trick imposed to us by retailers.
According to a study conducted by slickdeals.net, 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
among 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.
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.
Habit 3: Not Budgeting 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
cost and setting goals and limits.
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 into areas in which you may be over spending.
Unfortunately this is something a lot of people neglect doing which more than often results
in them over spending and getting into debt.
Habit 4: Not Investing 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 of 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.
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
landfill like cars, electronics, or designer clothing, 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.
Habit 5: Not tracking Your Expenses This goes hand in hand with habit 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 pin point 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.
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.
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 anyways…
Tracking your expenses is something that you should definitely start doing.
If you get nothing else from this video, then get this, Track… your… expenses!
I can’t stress this enough.
This one simple habit can literally change your life.
Thank you so much for watching.
If you liked this video please share it, It might help and friend or two.
Leave your thoughts below and with that said I will see you in the next one.
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