Money Expert Rachel Cruze Says These 7 Things Keep You Broke

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A recent survey by GOBankingRates found that over 70% of Americans, especially older millennials, are living paycheck to paycheck at least some of the time. While rising costs can cause financial strain even if you’re a higher earner, several bad financial habits also play a role in keeping you broke.

of “The Rachel Cruze Show,” financial expert Rachel Cruze revealed these seven things that might be hurting you financially.

1. Having the Wrong Mindset

Whether you learned about money from your upbringing or current social circle, having the wrong mindset could make you feel out of control. Cruze suggested not staying stuck in such beliefs and instead making decisions to improve your situation. This can involve spending more thoughtfully, saving more cash, setting goals and learning about personal finance.

2. Living an Inflated Lifestyle

When your earnings increase, you might feel justified spending more just because you can afford to. But if your new expenses get out of control, you might take on costly debt. Cruze cautioned against living an inflated lifestyle and recommended putting your spare cash toward financial improvement. You could pay off debt, invest in your retirement or replenish your emergency fund.

3. Not Being Intentional With Time and Money

Cruze emphasized being careful with how you spend your time and money. She suggested having a budget with spending limits and avoiding charges to credit cards. Rather than wasting spare time, consider earning a side income, examining your finances or planning meals to save on grocery costs.

4. You Don’t Save Money

Living paycheck to paycheck increases your risk of staying stuck in a bad financial situation, especially if an emergency arises. Cruze said you should build a safety net with $1,000 to start and bump it up to three to six months of your expenses once you eliminate debt. Besides having your emergency fund, you can also save for goals such as retirement.

5. You’re Still Using Credit Cards

Cruze cautioned against using credit cards because of the long-term issues they cause. Not only do they cost you interest and stress, but cards even encourage spending more money versus using cash. Her solution is to budget property so you get out of the cycle of needing credit cards.

6. You Don’t Delay Gratification

You might stay broke when you buy unnecessary things on impulse because it feels good and gives you a rush. Cruze explained, “You have to be able to have the mindset to say I’m gonna say ‘no’ to stuff that I want.” She offered a few tips if you find this challenging, including adding items to your cart but not ultimately buying them or giving yourself a month before buying things.

7. You Lack Financial Goals

Unless you have money goals, you can find yourself aimlessly spending rather than building a strong financial foundation. Cruze advised writing down time-specific financial goals that are important to you, specific and measurable. For example, you might decide to use her recommended debt snowball approach to become debt-free by a certain deadline.

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