Have you ever wondered why you are always going broke? You earn an income, yes. But before long, everything seems to just DISAPPEAR.
Do you get paid today, live like a king for a few days and then end up broke for the rest of the month?
Do you just seem to find yourself in this unending cycle of being broke?
Not to worry. All that’s about to change if you would pay attention to these 10 major reasons you’re going broke every month and heed the solutions I recommend.
WHAT DOES IT MEAN TO BE BROKE?
If a person is broke, it means they have completely run out of money or may run out of money soon. This usually happens when someone spends above their means. This situation is usually temporary and can often be salvaged by the next paycheck. What you do with your paycheck however, will make all the difference in determining whether you’d become broke again or enjoy financial stability.
10 REASONS YOU’RE BROKE AND WHAT YOU CAN DO
1. You spend first before saving
Warren Buffet once said “Do not save what is left after spending, but spend what is left after saving”. What do you do with that paycheck when you receive it? If you’re the type that goes off to buy everything you’d ever wanted, without giving second thoughts to savings, then you know there’s a problem.
As a rule of thumb, you should make it a habit to remove a percentage of your income and keep as savings before spending what’s left.
2. You’re probably not making enough money
If you’re always broke month after month, then it’s probably because you’re just not making enough money. It’s okay to have a regular job and all that but a single stream of income is never the way to become rich.
Having just one source of income only means you’re putting your eggs in one basket. So what do you do? Get another source of income. Having another source of income generally means one thing – more money. And more money means you won’t be going broke all the time. There are several things you can do online to make money. Just look them up and choose anyone that suits you.
Also, you can seek to better your career by going back to school or taking up an advanced training that will leave you in a position for better opportunities.
3. You live beyond your means
Living beyond your means generally spells doom when it comes to your finances. Are you addicted to brands when you can only afford common products? Is your annual rent more than double what you earn in a year? Do you depend on credit cards to get by every time? If you answer yes to any of these questions, then you’re probably living above your means.
Cut back on your spending. A good budgeting plan will help you do that. The plan should be able to help you discern those spending habits that you can actually afford from those that are eating deep into your income, and then help you make the right choices.
4. You always eat out
Granted, eating out is a good way to bond with family, friends or your date. But if you are always in the habit of eating out or ordering take outs, then you’re definitely spending a large chunk of your income on feeding. Most restaurants don’t only charge for the food you eat, but also, for other services – making you comfortable while there, for instance.
Cook your own meals at home. If you don’t know how to, you can easily look up recipes online or ask those of your friends who are expert cooks to put you through. Cooking your own meals will go a long way in helping you save money. However, if you must eat out, learn how to do it cheaper.
5. You can’t have fun without spending money
Do you party like crazy every other weekend? Does your own idea of having fun mean you’d be spending a lot of money? Yes? Then this lifestyle is probably the reason you’re broke most of the time.
There are several interesting ways to have fun either alone or with friends, without spending money. I have taken my time to list out some of the ways in my article below.
6. You have no financial goals
Financial goals give you a general direction of what to aim for with your finances. You’d find it very difficult to plan and stick to your budget when you have no financial goals or long term plans you’re saving for. And this usually will result to you spending all the money you have at once, as they come.
7. You have your credit cards saved online
If you do lots of online shopping, it’s possible you have stored your credit card details there for easy checkout. Having your credit cards saved on various online shops helps fuel the habit of impulse shopping and makes it very easy to spend money online on what’s not necessary.
Delete your credit card information from all online stores and free trial subscriptions. Ever wondered why big online companies tell you to put in your card details even when they are generously offering free trials? It’s because they are hoping you’d forget you have your card saved on there, making them able to charge you for services you probably don’t need anymore. So start today and delete your credit card details from every online platform.
8. You can’t say no
Not being able to say no to unending demands from friends and family is probably one of the core reasons why you are broke today. Do you always find yourself entertaining requests from family and friends who seem to know exactly when your income comes in? Do you give in to their demands for financial favors all the time? If yes, then you’re probably hurting your your wallets more than you know.
Learn to say no to some demands and know where to draw the line when it comes to granting financial favors. Saying no is an option that will help your finances in the long run.
9. You have an expensive love life
One of main reasons you’re broke is probably due to your love life. If you’re a guy, and you’re constantly trying to impress your partner by taking her to expensive restaurants and dinner dates, or you’re under pressure to take the course of the relationship to a certain standard, then you should know you’re asking for disaster to your finances if you give in.
Put a leash on your romantic life for now if it’s making a huge dent on your finances. It helps if you have an understanding partner who would agree to live frugally with you and cut back on unnecessary spending and demands.
10. You don’t write down your expenses
If you’re always going broke, then it’s probably because you don’t keep track of your expenses. Writing down how you spend money will go a long way in helping you keep track of the things you spent money on, as well as help you identify those unnecessary expenses you needn’t have made.
Start writing down the things you spent money on from today. You can can use your smartphone for this. It will help you stay organized with your finances.