20 Money Habits That Keep You Poor and How to Avoid Them

Share to help others

I have experienced both poverty and a bit of wealth. My friend, It is better to be wealthy! Poverty is not something to be desired at all. It is something you need to avoid by every good means possible! Why do I want you to be wealthy? You need to be wealthy in order to have more options. The rich have more options in life while the poor have few options. 

However, over the years, from my experience and  observation, I can tell you that the poor and the wealthy act and behave differently. Both sets of people have distinct attitude, behaviors and habits. Identifying these character contrast and applying them appropriately into your life will be invaluable if you want to become wealthy.

There is no way you can be wealthy if you keep acting the same way that made and kept you poor in the first place.

Therefore, in this article, I have put in my decades of experience and observation about the behavioral traits of the poor and the wealthy. Read these 20 habits of the poor below and learn what you need to change or start doing differently to become wealthy.

1.  You don’t deliberately seek financial knowledge.

Wealth creation is an art and must be deliberately learnt and the knowledge continuously updated. You should always be on the lookout for knowledge that can help you to legally increase your earning potential. Sound financial knowledge brings money and the lack of it keeps you poor. One good financial knowledge you should have is to know the difference between an asset and a liability and strive to acquire assets, especially appreciating assets. You must consciously develop and improve your financial knowledge.  The poor don’t do this and that is why they remain poor. They are not flexible to learn new things and modern trends in wealth creation.

See the 17 principles of wealth creation.

2. You don’t save.

Many poor don’t save. The spend as much as they earn or make. Those that try to save deep into their savings at the slightest financial difficulties they experience. According to Robert Kiyosaki, ” the rich invest first and then spend what is left while the poor spend first and invest what is left”. When you spend first, before thinking of investing, most times there would be nothing left to invest, because human wants are innumerable and inexhaustible. It is recommended that you should save at least 10 percent of your income.  This is usually the first step towards wealth creation.

3. You don’t invest.

Save but don’t stop at saving, also invest. Earn money from your savings. Don’t just allow your money to sit idle in your savings account and depreciate. You can move that money to accounts that yield interest like the money market account and treasury bills account. Don’t wait until you have more money to invest. Make use of the secret of compounding. Little monies invested overtime can help you build great wealth.

Some of the safest ways of investing is to put your money in a mutual fund or by buying treasury bills. 

Also, see why you need to develop an investment mentality to create wealth. 

4. You are trying to impress others.

The poor always try to impress people by buying expensive things that they cannot afford. Many of them borrow just live and feel big. This is common in Africa. We throw parties just to impress people. We live flamboyantly just to feel among. I have watched people spend millions just to do a wedding ceremony and after their wedding, they keep paying debts incurred during the wedding. You don’t need to impress anyone in life. Just be yourself. Plan and hope for the best. Make sacrifices in the present that would give you a better future. Don’t mortgage your future for present pleasures.

5. You don’t have a financial plan.

Without a financial plan you will hardly make deliberate efforts to make financial progress in your life. You should know your current financial status and plan every time. Your financial plan helps you to know your immediate, medium and Long term financial goals so that you can work towards them. It also helps you to track your financial goals and how you can achieve them. It helps you to plan for major life stages and expenses like marriage, child-bearing, training your children in the university and for retirement.  Each life stage, comes with unique financial challenge, but when you plan for them, you will set financial goals that will help you to be ready for them.

Read Also:  Simplified! How to Invest in the Nigerian Mutual Funds

6. Not don’t have an emergency fund.

Emergencies like job loss, accident, serious illness do occur and if you don’t have an emergency fund, it can lead to financial disaster and difficulties like borrowing, premature liquidation of your investments etc. However, an emergency fund serves as a cushion for any of these emergencies.  An emergency fund is money set aside in a safe and easily accessible account for major financial emergencies in your life. According to Andy Bryon, you should save three months of living expenses if you’re a two-income family, and six months of living expenses if you’re a one-income family.

7. You spend without a budget.

You can never save money if you don’t budget. The reason is that human wants are insatiable. Expenses always arise to take up all available money you have. And if you have not defined your budget for the month or week or day, you will easily give in to the emotional pressure to spend. When it comes to money, our emotions are not a good ally. If you listen to your emotions all the time, you will spend on both the things you need and the things you don’t need and you are likely to waste money. Also, you are very likely to get into debt if you listen to your emotions all the time.  However, with a budget, you can control your spending and tame your emotions.

8. You take financial advice from inexperienced people.

Not losing your money is one of the keys to building wealth. Taking financial advice from inexperienced people can make you vulnerable to wrong investment moves that can make you lose money.  Family members, friends and associates and even people who sell financial products may bring several financial advice to you at one time or the order. You can listen to them, but don’t be pressured to do what will not help you to attain your financial goals. Even if the person is a certified financial manager, don’t feel that he or she knows it all when it comes to business and investment. When you get any financial advice from anyone, you should also do your own research to validate the advice and to see if it is safe, profitable and meets your financial goals, else you may risk losing your money.

This blog can also be a good source of financial education for you. Check this blog weekly for new information . You can add your email address to our mailing list using the “Join The Millionaire’s Club “ botton  which you can find as you scroll down after this article. When you join our mailing list, you will receive free  email notification each time we publish a new article.

Do well to join our Telegram group to relate with thousands of like-minded people about investment, business and money matters. Just click our Telegram group link after installing the telegram app on your mobile device. You can download the telegram app from Google Play store to your phone.

You can also follow us on Facebook,  Twitter or  Instagram for frequent updates with vital information on entrepreneurship, business, investing, inspiration and wealth creation from time to time.

9. You subscribe to get- rich-quick schemes.

In recent years, many Nigerians lost millions of naira to several Ponzi schemes. This was caused by greed and lack of financial knowledge.

There is no legally easy or quick way to make money. Just have that at the back of your mind. Regardless of what the promoters of get- rich- quick schemes tell you, wealth creation takes time, patience and hard work.

10. You believe in luck.

There is no such thing as luck when it comes to money. Many people just sit down and do nothing, while others spend all day praying to God to send them money or make them wealthy.  Things don’t work that way. Prayer only works after you have worked.

Luck doesn’t just happen. If at all there is luck, it is deliberately created by positioning yourself and hard work. Thomas Jefferson is often quoted to have said, ‘’I’m a firm believer in luck, and I’ve found that the harder I work, the luckier I get.”  This is true. Roll up your sleeves and get to work. Work hard and smart at what you do, save and invest and with time you will get wealthy.

Read Also:  Tips To Remember If You Are Using Personal Loan With Paid Default

11. You procrastinate.

Don’t wait until you have more money to invest. Don’t wait to start that new business. There is never a perfect time to do anything in life. Start saving now, start investing now and try that new business now. The fear of failure should not stop you from attempting new things. It is better to try to fail than not to try at all. The poor always have an excuse for not trying. They always procrastinate, but the rich are go-getters. The rich look for and seize opportunities. When the procrastinators are finally ready to attempt great things, the train of opportunities must have left the train station.

12. You do the impulse buying.

You must not buy everything you want, even if you have the money to buy it. The poor always buy on impulse and most times regret after buying. Even if you have extra cash as your disposal, you can save and invest it so that it would yield more money for the proverbial rainy day. The effective way to control impulse buying is to always make a budget and try as much as you can to stick to the budget. Also, resolve not to be controlled by emotional buying. An effective way to control emotional buying is to resolve not to buy anything immediately you see it. Allow at least a day or even a week (depending on the cost of what you are buying) to pass before buying anything you see. If you are still interested in buying the item after a week, then you are most likely not been control by emotions.

13. You don’t have multiple streams of income.

I have never seen a wealthy man with only one income source, but most poor people have just one income source. Relying on a single income source like a job is very risky. What if you lose your job or your current income source? Multiple income streams take away these risk to a large extent and even make you wealthier and have more peace of mind. Building a second or multiple income streams doesn’t mean you must leave your 9 to 5 job. There are many ways you can do this. There are several part-time jobs that you can do. What about investing your money in Treasury bills or even the stock market? What about starting a part-time business and employing someone to run it for you while you do your day job?  There are many business ideas  you can invest in. You have no excuse not to build multiple income stream.

See 30 lucrative busineses that you can start with as little as N100k in Nigeria.

Read this: Explained! How to Invest in the Nigerian Treasury Bills and Make Money 

14. You live above your means.

The simplest test to know if you are building wealth is to check if you are spending more than you earn or make. You can never be wealthy if your expenses are always higher than your income. The key to having a positive income statement is living within your means.  If you are not comfortable with your current state of life and want to increase your standard of living, then you should work harder and smarter to increase your income. The two ways to live within your means is to spend less or make more money.

15. You don’t buy appreciating assets.

The poor buy depreciating assets like electronics, cars and gadgets while the rich buy more of appreciating assets like stocks, treasury bills, bonds, real estate. Depreciating assets, lose their value overtime and even make you to spend more money on maintaining them, but appreciating assets increase in value over time and even yield more income.

16. You are on debt and you don’t prioritize paying it off.

Most poor people are borrowers. They borrow to meet personal family and needs. The rich hardly borrow. They only borrow to invest. Even when the rich borrow to invest, they do it cautiously and seek for loans with the lowest interest rates and they are committed to paying off the loans as soon as possible. However, most poor people are always in debt and they don’t deliberately try to repay these debts.

Debt is a setback on your journey to wealth. It draws you back with the interest rates especially as it compounds. I have watched people struggle with debt but instead of them to set themselves free, they get into more debt by borrowing more.

Read Also:  17 Invaluable Principles Of Wealth Creation And Career Success

Getting out of debt is not very easy. It takes determination, sacrifice and commitment. The first step to get out of debt is to stop collecting loan borrowing. If your debt is because of your credit card, then stop using a credit card for now until you have cleared your debt. You don’t get out of a pit by digging more into the hole.

Pay off all your debt starting from the ones with the highest interest rate. Reduce your spending and stop taking more loans. Overtime, you will be happier, have more peace of mind and better poised to build wealth.

See 11 sure-fire ways you can get out of debt faster even on a low income.

17. Majority of your friends are poor people.

The poor always handout with poor people. This is very bad and it is what is hindering your progress in life and preventing you from becoming wealthy.

Many of the great financial moves I have made over the years that made me wealthier was because of the influence of some persons I related with. You can’t spend time with wealthy or poor people and not have a bit of their attitude rub off on you.

I don’t mean you should despise the poor.  I am only saying that you should not only have them as your friends. Reach out to the wealthy people. Try to get closer to wealth people so that you can learn from them. There is always something you can learn from them. Their passion, knowledge, attitude and ideas will rub off on you.

18. Your thoughts are always negative and pessimistic.

Pessimism is one of the greatest inhibitors of personal success and wealth creation is not an exception.

The poor always find reasons why a business or investment idea will not succeed. They are good at giving excuses. Excuses hasn’t helped anyone to achieve anything. They only limit you.

The rich are good at finding a way around any perceived hurdle or difficulty on their way to success. The rich are always positive people.

19. You are stingy

Most stingy people I have met are poor people. Most super rich people in our world are generous people. Think of Bill Gates and other super wealthy people, they are always willing to give. They part with millions of dollars every year to help the less privileged.

The more you think of the needs of others, the more you strive to increase your capacity to meet the needs of others. However, when you only think of yourself, your needs and that of your family, you only get what would be sufficient to meet just that level of need. However, when you strive to meet the needs of many people, God will give you the ideas and resources that will help you to meet the needs of many.

20. You don’t tithe.

This has been a controversial subject in recent times.  However, I believe in thithing. Giving 10% of your income to God is one of the ways we express our gratitude to God who enabled us to make the 100% in the first instance. It attracts God’s blessings on your endeavours.

What are your views about this article? Let us know using the comment section below. If this article was of help to you, kindly share with friends using any of the social media platforms at the top or bottom of the article.

NB: Do well to join our Telegram group to relate with thousands of like-minded people about investment, business and money matters. Just click our Telegram group link after installing the telegram app on your mobile device. You can download the telegram app from Google Play store to your phone.

You can also follow us on Facebook,  Twitter or  Instagram for frequent updates with vital information on entrepreneurship, business, investing, inspiration and wealth creation from time to time.

Share to help others


  1. It was all making so much sense until I got to #20. Why do Africans especially believe it is tithe payment that creates wealth for people? Same tithe that isn’t meant for today’s Christians. I have always told people if you preach tithe to me then don’t tell me about grace, forgiveness and Jesus because there was no grace but instant judgement in the era of tithe, no forgiveness but an eye for an eye, no Jesus but the prophets and scribes / Pharisees. Why do we pick up what is beneficial to us n leave the rest. Remember God’s commandments are not optional. If you keep 9 and fail in 1 you are guilty of all. Pls let’s study out bible. But from #1-19 am sure practicing them. Thanks a lot.

  2. What’s Happening i’m new to this, I stumbled upon this I’ve found It positively helpful and it has aided me out loads. I hope to contribute & help other users like its aided me. Good job.

  3. Thanks a bunch for sharing this with all people you really recognise what you’re speaking approximately! Bookmarked. Please additionally visit my site =). We can have a link exchange agreement among us!

  4. It’s really awesome. I love it.very interesting and meaningfull post. I got some very important views in your post which are very good and applicable for me. I just wish that I’ll see your another post very soon. I am waiting for that.

Leave a Reply

Your email address will not be published. Required fields are marked *