Money Mistakes That Keep You Poor

 

1. Paying Yourself Last Keeps You Stuck in a Cycle of Being Broke

There are two kinds of people when it comes to money. The first group gets paid and immediately starts clearing bills, rent or mortgage, utilities, credit cards, subscriptions, groceries, outings, entertainment. Whatever scraps remain at the end of all this (if any), they try to save.
Most people don’t realise that this habit guarantees they will always feel short on money.
The second group does the opposite: they pay themselves first.
This means setting aside at least 10% of their income the moment their paycheck arrives. Only after securing their savings do they start paying everyone else.

Of course, with today’s high cost of living, saving a full 10% of your after-tax income can feel unrealistic. That’s okay, think of it as a financial goal. Working toward it encourages you to cut non-essential spending and take control of your money

Why Paying Yourself First Actually Works

When you prioritise saving, you ensure that a portion of your income goes directly into your future instead of disappearing into day-to-day expenses. Even better, savings accounts and term deposits are now offering around 5% annual interest, which means your money earns more money over time.

2. Not Having an Emergency Fund (3–6 Months of Living Expenses)

Most people underestimate how expensive life becomes when they don’t have a financial safety net. Without an emergency fund in a ready-to-access savings account, every unexpected cost — a car repair, a medical bill, a broken appliance — becomes a crisis.

When there's no cash buffer, the only solution is often a credit card. That means instant interest, growing balances, and years of financial stress. Many people get trapped in this cycle: relying on credit, falling behind on bills, and sacrificing real needs while still spending on wants.

But this spiral is avoidable By paying yourself first as mentioned earlier, you slowly build an emergency fund that shields you from debt. It’s your financial oxygen mask, giving you room to breathe when life throws surprises your way.

3. Not Knowing Your Income and Expenses Keeps You Broke

Most people underestimate how expensive life becomes when they don’t have a financial safety net. Without an emergency fund in a ready-to-access savings account, every unexpected cost a car repair, a medical bill, a broken appliance becomes a crisis.

When there's no cash buffer, the only solution is often a credit card. That means instant interest, growing balances, and years of financial stress. Many people get trapped in this cycle: relying on credit, falling behind on bills, and sacrificing real needs while still spending on wants.

But this spiral is avoidable, By paying yourself first as mentioned earlier you slowly build an emergency fund that shields you from debt. It’s your financial oxygen mask, giving you room to breathe when life throws surprises your way.

4. Not Knowing Your Income and Expenses Keeps You Broke

The truth is simple: the more money you make, the easier it becomes to lose track of it. Many people have no real idea where their income goes each month and that lack of awareness is one of the biggest reasons they stay stuck financially.

To break free from this cycle, you must take control. Use a budgeting app, track every dollar, and understand exactly how much you earn and where it flows. Start by paying yourself first, then map out your expenses clearly and honestly.

Those who understand their money eventually grow their money. They spend consciously, save intentionally, and make decisions that build wealth over time. In contrast, people who dream of being rich but never track their finances often watch their income disappear without purpose or progress.

Financial clarity isn’t optional it’s the foundation of financial freedom.

5. Having Expensive Hobbies Without a Budget

We all deserve joy. Life isn’t meant to be nothing but bills, responsibilities, and numbers on a screen. Hobbies are important  they help us grow, unwind, and reconnect with ourselves. But when the things meant to bring you happiness start draining your bank account, the joy quickly turns into stress.

Some hobbies are wonderfully affordable, while others can become financial traps. Think of the countless boats, jet skis, or gear-heavy passions people finance without a plan. What begins as a fun escape can turn into years of debt. And there’s no sense borrowing money at 20% interest for ski trips, fishing adventures, or luxury gear that brings a moment of excitement but months of financial worry.

A hobby should lift your spirit not weigh down your wallet. When you budget for fun, you can enjoy life without sacrificing your financial peace.

6. Waiting Too Long to Invest

Every day you delay investing, your money quietly loses value. Inflation doesn’t wait it slowly eats away at your purchasing power, making every dollar worth a little less each year. That’s why starting early is so powerful. Even the smallest investments can grow into something meaningful when compounded over time. Compounding isn’t just a financial concept it’s your money working for you, day after day, while you sleep, live, and dream.

Yet so many people hesitate, waiting for the “perfect moment,” which often never comes.

Even simple steps make a difference. With term deposits now offering interest rates close to the OCR, it’s incredibly rewarding to set aside savings and watch them grow a visible reminder that your money can earn more money, effortlessly and steadily.

The sooner you start, the stronger your financial future becomes. Don’t let time slip away let it work in your favour.

7. Neglecting Financial Education

Far too many people overlook one of the most powerful tools for building wealth :financial education. When you don’t understand the basics of money, it becomes easy to fall into traps, make costly mistakes, or rely on guesswork. Learning about investing, interest rates, taxes, and other key financial principles isn’t just helpful it’s life-changing.

And the best part? You don’t need a degree or a fancy background. There are endless online resources, workshops, and seminars designed to guide you step by step. A little knowledge can dramatically reshape your financial future.

As we often say, knowledge is power. Most people avoid financial education because they assume it’s too complicated, but understanding the fundamentals can turn financial confusion into confidence. It can take you from feeling lost to feeling resilient.

That is exactly why Earnly was created to motivate and empower people from the comfort of their phone, tablet, or computer. Every piece of information is designed to help you build a strong foundation, so you can make smarter, safer, and more informed financial decisions.

8. Ignoring Small Daily Expenses and Never Saying No

It’s easy to dismiss the cost of your daily coffee, snacks, or little impulse purchases. On their own, they seem harmless even enjoyable. But over weeks and months, these small expenses quietly eat away at your income, leaving you wondering where all your money went.

The key is awareness. By tracking your spending  whether through a budgeting app or a simple daily expense diary you can see the true impact of these “tiny” purchases. Awareness gives you control, and control gives you freedom. Learning to say no to unnecessary spending doesn’t mean missing out; it means protecting your future and your financial goals.

9. Dating Someone Who Has No Understanding of Money or Costs

The people you choose to share your life with can have a huge impact on your financial well-being. Being in a relationship with someone who doesn’t understand or respect money can lead to financial strain, stress, and tension no matter how strong your love may be.

Financial compatibility, or at least a shared understanding of money, is just as important as emotional connection.

Too many relationships suffer or even end because of money. It’s one of the leading causes of breakups and divorces. Often, conflicts arise when a spender and a saver struggle to agree. Money or the lack of it can create tension and resentment, so aligning financial habits and goals is absolutely critical."

Choosing a partner who shares or respects your approach to money isn’t about controlling them it’s about protecting your shared future and building a life together without unnecessary stress.

10. Avoiding Money Conversations

Talking about money can feel awkward, intimidating, or even taboo. Yet avoiding these conversations whether it’s negotiating your salary, discussing finances with a partner or family, or seeking professional advice can silently cost you over time.

Financial clarity and growth come from openness. Make it a habit to have honest, direct conversations about money. Ask questions, share your goals, and seek guidance when needed. The more comfortable you become discussing finances, the stronger your control over your financial future will be.

Remember, wealth isn’t only about what you earn it’s about what you keep, how wisely you manage it, and the choices you make every single day