7 Mistakes Poor People Do

  • 1. Satisfy Your "Wants" Before your "Needs"

    "Needs" are things that are essential in your life like paying your rent, schools fees, grocery, and utility bills.

    "Wants" are the things that you desire but can live without like a fancy watch, a new mobile, or the latest car model.

    You must always pay all your "Needs" before you even think about your "Wants". If you live on a tight budget, like most people, going after your "Wants" first will put you in trouble. You will not have enough money later to pay for your "Needs" and be forced to borrow money and start slipping into the debt rabbit hole.

  • 2. Take Unneccerray Loans

    If you are struggling, either reduce your expenses or increase your income.

    More than 60% of borrowers regret taking a personal loan or buying unnecessary things by credit card.

    It feels good in the heat of the moment but will hurt you really bad in the long run.

  • 3. Don't save any money

    This is the easiest way to stay poor. Don't save a penny and just spend everything that you earn.

    As a general rule of thumb, a person should be saving 20% to 30% of their income.

    For many people, this is simply impossible as their income barely covers their expenses.

    To combat this situation, save 5% of your income and just manage with the remaining 95%. Convince yourself that your salary dropped 5%. You can do it I guarantee it to you. Increase the saving percentage as you get into the habit.

  • 4. Don't keep track of your expenses

    Not knowing where your hard-earned money is going is a recipe for disaster.

    It is vital that you track, write down, and have a 100% visibility of your spending. That is the first step to patch the leakage and to avoid revenue depletion.

  • 5. Buy very cheap and low-quality things

    Cheap is expensive they say.

    There is a difference between getting a good deal on something and just buy cheap low quality products.

    Instead of buying a low-quality product that you have to replace 5 times in the next year, buy a good quality one that will serve you two years.

    There are many exceptions of course. Use your common sense when buying stuff and remember that expensive items might be cheaper in the long run in many cases.

  • 6. Delay important stuff

    Reduce your important and essential needs for later to save money now.

    The most notable example of this is eating cheap unhealthy food. You will save money and sometime now by eating junk food but you will pay a very high price later in medications and treatments.

  • 7. Waste time

    Time is money. That is a very well said statement.

    You can't make up for the lost time. Every minute that passes by cannot be recovered.

    Make something useful and productive in your wasted time or you won't have enough time later when you really need it.