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8 Habits That Keep You Poor Despite Having a Decent Income

(TNO) Have you ever wondered where most of your earnings go or why, despite having a decent income, your bank account balance isn't substantial at the end of each month?

Administrator

12 October, 2023

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(TNO) Have you ever wondered why you often struggle even though your income increases or why you still have very little money in your bank account at the end of each month despite having a decent salary? Here are 8 common money habits that keep many people poor, according to the website Life Hack.

There are many habits that keep you poor even with a decent income – Image: Shutterstock

1. Overspending when income increases

There is nothing wrong with raising your standard of living when you can afford it. However, if you are someone who always spends more every time your income increases or even spends more money than you earn, you will find it difficult to save money. Always aim to have a budget and stick to it, even if your income increases, as it is one of the ways to be financially secure.

2. Focusing on the present and neglecting the future

Typically, people tend to prioritize their current needs and believe that they can fulfill their future needs later. To avoid this unproductive habit, consider long-term and future planning in your financial plans. Prioritize the present, but don’t forget to save for the future.

3. Thinking it’s too early to start saving

When you are young, you may find that there are many things money can buy and come up with endless reasons to spend it. Many people think “right now” is too early to start saving. Start as early as possible. Dedicate a portion of your income to savings in order to start saving early, and then spend comfortably with the remaining amount.

4. Not keeping track of expenses

Everyone thinks they know where their money goes and have already used it for important things. However, most people don’t realize that small expenses often drain their wallets more than large ones. Keeping a record of your income and expenses, regardless of their size, is a great practice to gain financial control.

5. Not having a budget

You may remember everything you bought recently, but forget to start with a budget. Having a solid and clear budget is essential and, in fact, it’s best to think about financial planning at the beginning of each month. Add to that always spending within the budget you have set will help you avoid unnecessary expenses.

6. Not being clear about desires, needs, and financial capabilities

When it comes to saving and getting richer, it is crucial to prioritize what is really necessary, the things you really need, and the things you don’t need. Put your financial goals first. You may need to give up some present comforts, whether you want to or not, if getting rich is your primary goal.

7. Being burdened by debts

Interest can be a huge burden on your finances. Many people struggle to break free from this cycle and, remarkably, have very little or no savings. To get out of this situation, you should try to build an emergency fund and follow it strictly.

8. Constantly buying new gadgets

There’s nothing wrong with buying the latest gadgets or tech devices that you truly need. However, chasing after gadgets, buying the latest smartphone just because it is the newest version on the market, can leave you much more financially drained than you thought.