Have you ever wondered why it’s easier to spend money than to save? One common problem among most adults is managing their finances. As much as people take the effort to keep track of their finances, many don’t realize that financial education helps in achieving stability the soonest.
In fact, most people are aware of how they are most likely to overspend but continue to do so and regret it later on. Nevertheless, overspending may be caused by an emotional drive that can be challenging to stop.
While adulting is forever, so are financial responsibilities, and of course, the never-ending battle between what you want and what you need. And the best thing to do is to manage your expenses so that you don’t end up being broke in the end. But along with these, the question “Why am I always broke?” remains.
Here are some of the reasons why you will always be broke, and how you can deal with it.
1. You’re stuck in debt trap, and there’s no way out of it.
Most people tend to be manipulated by credit card perks and instalment promos, which made spending easier—leading to a usual impulsive routine one can resort to.
Whether it’s a payday loan or debt settlement scam, making rash decisions might help in settling your dues. However, it can dig a deep hole from your pocket in the long run.
Drowning yourself in debt will surely hurt your finances badly, but you can stick to a budget and avoid extra expenses especially if there’s no money allotted for it. Save up for future expenses you’ll encounter rather than borrow a loan for it.
2. You lack knowledge about personal finance.
Most people are broke because they lack financial knowledge, and some people tend to make decisions they think would help them. However, it pays to know how your money can grow through financial literacy.
Separating your needs from your wants, for instance, can help you manage your finances. Set aside unreasonable expenses, as these can wait, and prioritize those that are essential for you. Shift your financial goals from what can make you happy now too what can get you financial freedom in the future
3. You’re broke because you live in an unaffordable lifestyle.
People end up broke because they want too many things too soon, and some spend more than they make. Probably, the thought of living the happy-go-lucky life makes them happy now, but to earn financial freedom the soonest, you should always aim for a long-term goal.
Spend less and live within your means to spare some extra cash for your future. Drop the Starbucks routine and try public transportation instead of your usual Uber ride. Always remember to put your financial needs on top of everything, and set temporary things aside.
4. You’re not making savings a priority.
There’s almost always a cheaper or better way of doing something. When the time comes, you’ll be needing more than just what you make, and it’s going to be hard to keep up with those expenses in the long run. As early as now, prepare for your future and prioritize what matters most.
With the right discipline and motivation, it’s almost as easy to save money without the hassle. Use your creativity and critical-thinking skills to come up with more cost-effective alternatives that you can use.
In the end, spending money should not be an unhealthy habit. Know that these challenges are easy to surpass if you have the right mindset and motivation to achieve financial freedom while you still have the time.
Spend according to plan and focus on the things you need the most. This is indeed the primary key to financial independence. Follow them.