Each day we make decisions that have an impact on our finances. Some of these decisions are positive while others turn into bad money habits that we need to break sooner rather than later.
Have you ever tried to keep up with the Joneses? Are you ignoring your student loan debt? Do you swipe your credit card everywhere you go?
If you answered yes to any of these questions you may have bad money habits that you need to work on improving.
The sooner you can break these bad money habits, the sooner you can start to thrive in your finances and in your life.

9 Bad Money Habits Keeping You Broke
Keeping up with the Joneses
Let’s talk about the elephant in the room to get started. Keeping up with the Joneses.
The Joneses can be a family member who seems to be thriving, a neighbor with a fancy car and designer clothes or the random family you saw at the store that seems to have it all together.
There are Joneses all around us.
When you keep up with the Joneses you are working to impress people. You may be using debt to leverage your lifestyle so you can appear to have more money than you truly do.
Keep up with the Joneses will keep you broke.
You will continue to cycle through debt and living above your means.
Here’s the truth. Most people don’t notice what you are driving nor care about your house nor attire.
Keeping up with the Joneses is not worth it because:
- you will never truly be happy
- you will compare yourself to others
- you will go into debt to keep up with everyone around you
- you will not have money to invest in your future
By being content with your life and thriving within your current life situations you will be much happier.

Ignoring Your Debt
Do you have a mountain of debt piling up? If so, it is time to break the bad money habit of spending more than you earn and face it head-on.
Debt will cost you thousands of dollars in interest and keep you in the cycle of spending more than you earn.
According to debt.org the average amount of debt for millennial’s is $67,400.
Types of Debt Include:
- credit cards
- personal loans
- student loans
- car loans
- mortgages
- payday loans
These debts are designed to keep you paying each month while lining the bank’s pocket with interest payments and late fees.
The best thing you can do to break this bad money habit is to come up with a plan to pay it down. This could be using the debt snowball to attack your debt or even the debt avalanche to pay down the high-interest rate loans.
The key is to pay off the debt and stay consumer debt free long term.
Not Utilizing a Budget
A budget is a great step to ditching bad money habits and reaching your financial goals.
When you have a budget you are planning how to spend your money and can reach more financial goals.
If you are new to budgeting I highly recommend downloading my free budget worksheets. These will help you set up your beginner budget so you can start living within your means and break this bad money habit.
Making Late Payments
When you utilize a budget you will also stop making late payments.
Late payments are a bad money habit to have because you are spending money unnecessarily. A late payment is a result of not having enough money due to poor planning.
Paying for Subscriptions You Don’t Use
Do you know which subscriptions you pay for each month? quarter? year?
I highly recommend looking at the subscriptions you have and deciding if it is something you use regularly and if it is worth the monthly fee. There may even be subscriptions you forgot about because you haven’t utilized it in so long.
Here are Some Subscriptions You May Have:
- Netflix, Hulu, Disney+, YoutubeTV, SlingTv
- Gym Memberships
- Massage Memberships
- Magazines
- Amazon Prime + Audible
- Apple Music, Spotify, Pandora Premium
- Online Newspaper and Media
- Patreon
- Costco, Sam’s Club, BJs
There are subscription services for just about everything now. You want to look for recurring payments in your budget that you can possibly cut out altogether.

Not Being Prepared for an Emergency
Having $1000 in savings is not being prepared for an emergency. It is a start but it is also a bad money habit to believe that is enough to prepare yourself for an emergency.
Many of us are learning that the hard way with the 2020 pandemic we have been living through for several months.
Preparing for an emergency is having 3 to 6 months of expenses in a cash savings account.
If you currently do not have an emergency fund make it a habit to set aside a percentage of your paycheck to begin building that buffer for yourself. This will help safeguard you against the what-ifs that life throws you.
Also, have a list of reasons you are able to use your emergency fund.
Changing the oil on your vehicle is not an emergency, it is routine service, but getting into a car accident would be an emergency.
You need to decide exactly what your emergency fund will cover so you do not dip into that savings to cover everyday expenses unless absolutely necessary.
Making Impulse Purchases
Impulse purchases are a bad money habit that most of us have. Impulse purchases can be categorized as buying goods and services that are unplanned.
When is the last time you walked into Target and walked out with a basket full of goods? were those items on your list? Probably not. Those are impulse purchases.
Planning your purchases is the best way to break this bad money habit and staying within your budget.
Relying on Credit Cards
Relying on credit cards for everyday purchases is a bad money habit that needs to be broken.
Many people who utilize credit cards don’t have the money in their budget to pay off the credit card every month. This results in unnecessary interest charges and fees.
When you stop relying on credit cards you’ll feel your purchases more because the money will come directly from cash or your bank account. You will make fewer impulse purchases and stick to your budget more often.

Not Planning for Retirement
For many of us, retirement is 30+ years away. It is not something that we are faced with in our immediate future so we tend to put it ion the backburner.
Not planning for retirement is a money habit that must be broken today.
If you want to retire a millionaire and be able to afford your lifestyle in your golden years you must begin contributing early on in your adult life.
If you just starting out with investing definitely look at the options your work provides. Many employers have company-sponsored 401k plans that you can contribute to.
You can also look into Roth IRAs that will grow tax free over the years.
Hiring an investment professional is a great way to ensure you are doing the best thing with your money moving forward to ensure you will have a comfortable retirement.
Nerdwallet has an awesome retirement calculator you may want to check out to see if you are on track for retirement.
Breaking Bad Money Habits Can Be Simple
Which bad money habits do you have?
- Keeping up with the Joneses
- Ignoring Your Debt
- Not Utilizing a Budget
- Making Late Payments
- Paying for Subscriptions You Don’t Use
- Not Being Prepared for an Emergency
- Making Impulse Purchases
- Relying on Credit Cards
- Not Planning for Retirement
Start by picking one of the above mentioned bad money habits. Begin creating new habits that are positive for your money situation. In a few short months, you will have completely broken that bad money habit and can move onto a new habit to change.
Once you are able to kick all of these bad money habits you will see a huge shift in your finances and the amount of money you have in the bank and retirement accounts.
It will truly surprise you how much money you have been wasting over the years and how much further your money can truly go.
