11 Mistakes You’re Repeating That Will Make You Stay Poor
Number 6 is the biggest culprit of them all. Avoid it at all costs.
I’m going to start with the most cliche quote of them all. One that although you’ve heard, you probably have not listened to.
“The definition of insanity is doing the same thing over and over again, but expecting different results” - Albert Einstein
One of the biggest mistakes we make is repeating the same mistake over and over again. We know we are doing something wrong, but we don’t bother to make meaningful changes.
Some are too scared to try something new, and others simply don’t know better.
Let’s identify the mistakes you’re making that will make you stay poor.
1. You are no longer learning new things
What sets you apart from Bernard Arnault, Jeff Bezos or Elon Musk?
Sure, they’ve experienced their fair share of luck on their way to the top. Aside from a little luck though, the main two differences are that they know something you don’t, and are doing something you aren’t.
Their unique set of knowledge that they have did not come from school, so it was not because of money that they were able to attain that knowledge.
The knowledge they have typically comes from books, experiences and other people.
There are many ways to learn new things. That’s not what is important.
What is important is that you never stop learning.
Don’t make the mistake of thinking your education is done when you graduate from school.
The world is a classroom and the rich know that. Keep learning.
2. You are not taking action
Knowledge won’t do anything for you if you don’t take action.
So, maybe you have the exact set of knowledge as Bernard and Jeff (doubtful but play along). The only difference then is that they act on what they know.
They learned things that allowed them to spot opportunities and know how to capitalize when they saw them, and then they did something about it.
You can have all the knowledge in the world, but you have to do something about it!
Take action, find the courage, create the discipline. Your life is in your hands.
3. You don’t believe in yourself
One of the main reasons people don’t take action is because they don’t believe in themselves. They don’t believe they could do it.
These people will always have an excuse as to why they can’t act on the opportunity.
Maybe the time isn’t right (again), they believe they need more money to start up, or they just don’t have it in them.
You’ve got to believe in yourself. Relentless self-belief is necessary.
You need Kanye West's level of confidence!
Most successful entrepreneurs had no idea what they were doing when they started. They just believed in themselves enough that they knew they could find answers along the way.
You can do it. You’ve just got to find the courage to start, and the motivation to keep going.
4. You’re working a job with no potential to earn more
Unfortunately, it is very easy to get stuck in a job that does not pay well, and never will. You got comfortable, you like your coworkers, and you feel it’s too late to switch it up.
Hey, if you’re happy there, then stay there.
But, if you don’t want to stay poor, you’re going to need change.
Simple logic says that if you want more money, you need a job or a business that will bring you more money. That makes sense, right?
Aside from making more money directly from your work, you also need to make your money make money for you.
AKA, make investments.
You can’t make investments if your job isn’t paying you well enough to have spare cash flow.
5. You aren’t investing
If you are working a job, you can only make so much money.
Even if you have a business, the likelihood of you scaling it to a point that makes you good money is unlikely.
You’ve got to use the money you are earning to make more money. You’ve got to invest your spare money.
Now, you don’t need to become a master investor because the fact is that if you are working full-time, it will take you a lot of work to become effective.
Most people fail to beat the market and chances are you will too.
But, you can get a financial advisor.
However you choose to invest your money, the more you put it, and the longer it stays there, the more money you will make. That is because of compound interest.
For simple math, let’s say you put $1000 in a fund that is paying you 7% interest a year. If you leave that money in the account year after year, the first year you’ll only make $70, but the next year you’ll have made another $75.
That doesn’t seem like much, but that keeps adding up over time. After 10 years you’ll have made close to $1000.
Compound interest only works effectively if you give it time. That means you need to start now.
The best idea is to invest a little each month. Over time, this adds up like crazy.
Disclaimer: This is not financial advice. Talk to a financial advisor to learn about how you can make your money work for you.
6. You’ve created a lifestyle you can’t afford
You might be making good money through your work or business, and investing a bit of money too, but yet you're still poor. Why is that?
A lot of people make the mistake of continuously upping their lifestyle the more money they make.
For example, let’s say you were making $50,000 a year, and your expenses were $45,000. You got a raise to $100,000 a year, but then you bought a new house and car and now your expenses are $95,000 a year.
It’s okay to up your lifestyle, but you want to be investing more money as you start to make more because if you don’t, you will stay poor.
It’s also very dangerous if something happens to your income and then your expenses are still high. You get trapped.
In 2020, that’s what happened to me (and many others).
I had 2 houses and an expensive car, and I lost 90% of my income. I screwed myself and it had taken years to recover.
Don’t repeat my mistake. Be careful of the lifestyle you live.
“Savings can be created by spending less. You can spend less if you desire less. And you will desire less if you care less about what others think of you.” - Morgan Housel
7. You’re worried about what other people think of you.
It’s very common for your lifestyle to get too large for your earnings because you care too much about what others think about you.
I’ve seen this one take place in nightclubs time and time again.
Constantly there would be people coming in and buying bottle service, blowing thousands of dollars to impress the people they’re with.
Meanwhile, everyone knows they don’t make enough money to spend the amount they’re spending.
They care so much about what people think that they are making themselves stay poor.
It gets even worse when they start buying designer clothes and expensive watches.
If you care too much about what others think about you, and let your ego get the best of you, you will stay poor.
“Saving money is the gap between your ego and your income.” - Morgan Housel
8. You’re focused on the short-term
Not planning for the future is one of the best ways to stay poor. By focusing on the short-term, you aren’t worried about the decisions you are making today that will affect your tomorrow.
You’ve got to plan for the future.
That doesn’t have to mean you save every penny for a rainy day like your grandpa might tell you. But, you should consider what you are doing to better your future.
As I mentioned earlier, you’ve got to make your money work for you.
Aside from just investing in some funds, others like to buy rental properties or even businesses.
Yeah in the short term, you might be letting go of some cash (which might mean sacrificing your lifestyle), but in the long run, you’ll be building more cashflow and equity.
Again, not financial advice, but you should always consider how your decisions today will affect you in the future.
9. You aren’t paying off your high-interest debt
If you’re anything like me, you made mistakes in your 20s and built up too much high-interest debt. Now, you have a credit card bill and interest that is eating away at your cash flow.
Most credit cards charge you 20-25% interest. That is insanity.
You have got to pay off your credit card bills ASAP. This is one of the biggest things that you will stay poor.
It’s okay to make mistakes when you don’t know better, but that was the past. It’s time to correct those mistakes and change your behaviour.
10. You stopped caring
The sad truth is the fact that a lot of people simply stopped caring about their life.
“This is it for me.”
If that is your mindset, you will stay poor.
To change where you are in life, you have to make… changes, you have to care.
To stop being poor, you’ve got to learn new things, make better decisions, and take action.
You’re going to need courage, discipline, and consistency. You can’t do this if you don’t care.
11. You’re hanging out with losers
Sorry to say, but if you hang out with people who also don’t care, have lifestyles that don’t match their income, aren’t planning for the future, and don’t believe in themselves…
Likely, you won’t make the necessary changes.
“Show me your friends and I will show you your future.”
This saying is truer than ever. While I don’t like telling you to get new friends, that might be exactly what you have to do.
If you don’t want to surround yourself with different people, I would recommend trying to convince your friends to better themselves the same way you are trying to do now.
Perhaps when they see your lifestyle changes they will be encouraged to do the same.
Chances are that when you start making changes, you will quickly know which friends to keep and which to cut.
When you make these changes it is most likely that you won’t want losers around you.
Closing remarks
Unless you want to stay poor, you have to make changes. To make effective changes, you have to first identify what mistakes you are making.
How many of these mistakes are you currently making? Comment below!
The new year is near. It’s the perfect time to make significant changes in your life and create a better future for yourself, and your family.
Thanks for reading.
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