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Do you know those people who are destined for success? You can see it in their eyes that they’re headed for great things, even though the exact details of exactly what might not be clear.

On the other hand, there are people who are always broke. They just can’t ever seem to break through and get ahead. But why? Well, whistleblower Brian Penny, shares with us who they are…

The 7 People Who Are Always Broke

Despite many efforts to beef up my income and slim down expenses, I’m still somehow broke. I only have three months to make some major changes to earn more money, spend the money I have more efficiently and save up enough to continue my adventure. To do it, I need to identify what it is about me that makes me broke.

I reached out to T.J. Tillman, a founding partner at Empire Wealth Management, and several other financial experts to assess the financial and life issues I’m having. In discussing my options and wealth generation strategies, we came up with several commonalities among broke people. Essentially there are seven types of people who are always broke, and, if you have one of these personality ticks, odds are you’re broke too.

Here are the seven people who are always broke, and how you can avoid becoming one of them:

1 – People Keeping Up with Other People

Early adopters, gamers and other impulse spenders want to keep up with the latest and greatest. They’re only a small subsection, however, of the bigger epidemic of people trying to outspend their friends, family and neighbors just to prove they’re doing O.K. financially. If you try to go out with everyone else for a steak dinner when you have a hamburger budget, you’ll soon find your budget depleted.

“This pattern repeats itself over and over,” says John Hargrave, a bankruptcy attorney with over 30 years of experience. “No matter how much a person earns, they spend it all because they want it all.”

You don’t need a new car when someone else gets one, and just because a phone has new features, doesn’t mean they’ll benefit you.

It’s all well and good that you can use your phone as a projector, but have you used that function? Stop keeping up with the Jones, and save for your own future.

2 – People Who Never Pay on Time

Every bill you pay late adds an additional fee; this is pretty much universal anywhere. Your phone, utilities, mortgage, credit card bills – they all charge fees for tardiness. Even stretching out your loan to the maximum term limits in order to pay as little as possible is a terrible idea; a 30-year mortgage, for example, will more than double the ticket price of your house.

“A person with a great credit score may qualify for a mortgage at a 4% rate versus 5% for someone who has not managed their credit as prudently,” says Tillman of Empire Wealth Management. “This 1% difference in rate results in an additional $150 a month payment and an additional $53,000 in interest over the course of a 30-year loan.”

If you’re going to procrastinate, bills are not the place to do it. On top of all that, the credit reports will show you’re always late, and you’ll pay higher interest rates (if you can even secure credit). Punctuality removes many financial obstacles.

“The best way to tackle this problem is to get organized,” Tillman said. “Create a systematic way that works for you to stay on top of your payments and when they’re due.” There are a variety of free apps that send financial reminders to your phone. You can also manually input the info into a spreadsheet or balance your checkbook with pen and paper. How you do it is up to you, but get punctual, slacker!

3 – People without a Savings Account

When deciding how to profile people with financial problems, I reached out to Andre Pinantoan from Pocketbook (a personal finance app that not only tracks personal finances but also has enough extra features to work as a great alternative banking option in the very near future). Pocketbook currently has over 40,000 users, and they value user input while also analyzing habits. Here’s what Pinantoan had to say:

“What we find is that people who seem to be always out of cash is that they under-budget their emergency fund (like that scene from Pixar’s ‘Up’ of the old man and his wife). They underestimate the probability of bad things happening to them, and overestimate good things. In other words, they’re way too optimistic about their future.”

How can you ever save money if you don’t have a savings account? You have to treat it like a savings account as well; emergencies do come up, but if there’s no immediate life-threatening danger, don’t dip into your savings. A bit of creativity and resourcefulness will help you maintain the discipline needed to get yourself out of debt.

4 – People with No Ambition

Saving money involves earning money; if you don’t have a destination, you’ll never go anywhere. People with ambition have drive, motivation, and inspiration; those who lack one, lack all, and people who lack are truly broke. “Unfortunately, you’re probably not going to be able to change anyone else’s mind about how important having a great work ethic is,” says Tillman. “That’s something that needs to be learned and developed.”

Getting up every day to work toward something you love and are passionate about makes you more productive, which, in turn leads to more money. “Especially in this day and age where a corporate pension is an anomaly and Social Security is questionable at best, it’s more important than ever to be financially self-sufficient,” says Tillman. “If you have no ambition, you’ll always struggle with debt.”

5 – People with No Budget

In the land of the blind, the Cyclops is king. The only way to find your way out of debt is to make a budget. Having one in your head won’t work – as San Diego Financial Planner Sean Nisil puts it. “Some people get themselves into financial problems because they’re blind optimists,” he said. “They spend with the expectation that the money will magically appear in their bank account.”

You can’t fly on wings of hope and good intentions; you need to see the numbers on paper to make them real. You need something tangible you can focus on when you’re surrounded by mass consumerism. Whatever you think of his other accomplishments, what Columbus didn’t do was attempt to navigate without a map, so map your budget before you’re hit by a tidal wave of bills and drown in debt.

6 – Whiners and Complainers

It’s important to love what you do – money won’t automatically change your life, and if that’s the mindset you have, you’ll never actually have any money.

“I see it with my clients all the time,” says life purpose coach Melanie Cobb. “We need to get rid of their broken thinking before we even look at their bank accounts. When their thinking becomes abundant, so does their money.”

Finding happiness within yourself is important. It’s O.K. to have a bad day here and there, but if every day is a chore, then you need to find a new path. Yes, it’ll be uncomfortable, but what movie have you ever seen or book have you ever read where the protagonist sat around until something was handed to him? When you’re finally happy and fulfilled, you’ll stop impulse spending on things you don’t need and instead save for your future.

7 – Sympathetic Souls

I’m not condemning charity; it’s important to be a generous and compassionate person. The problem lies in putting others’ needs before your own. Some people are soft – they lack that killer instinct. We’d all love to see those people succeed in life, and the majority of them will — they’ll just do it while in debt. There’s a reason non-profits are called that – if you give to others in need, you’ll never have a surplus saved.

This isn’t to say you shouldn’t give a dollar to a homeless person (that actually costs less than your coffee or texting habit), but there’s a deeper issue with sympathetic souls. “People with low self-esteem will always be at risk for financial struggle, because they will always look for ways to purchase acceptance and love.” says Farrah Parker, an Image Consultant for PR and Strategic Marketing firm, FD Parker & Associates. It’s necessary to accept and love yourself, because, as the Beatles say, “Can’t buy me love.”

Speaking with these experts inspired me to keep pushing, despite my current situation of sleeping on a friend’s couch, helping to pay bills while keeping up with the trials, tribulations and expenses of everyday life. Saving money isn’t difficult, but it takes discipline. With proper planning, a solid budget and the passion to earn an income, we’ll have a solid foundation to avoid becoming one of the seven people who are always broke. I don’t know about you, but I’m tired of being broke.

—Written by Brian Penny, a former Business Analyst at Bank of America turned whistleblower, consultant and blogger.

These are well identified by Brian.

1. Everything is relative. The key to being happy with what you have is in separating how much money you have, earn, and spend with what those around you do. If you can do this (not keep up with the Jones’ or compare to others around you), you’ll not only be happier, but you’ll be substantially more wealthy!
2. Two great points here:
   1. Your credit matters. Good credit helps make it easier in the future (as you’ll get better, lower interest rate loans), and bad credit makes it harder. The rich get richer and the poor get poorer, so be sure to stay on top of those payment dates.
   2. Secondly, if you pay off your loans slowly, you’ll pay more interest. In the case of a 30 year mortgage, you’ll actually pay more than 2x the value of the mortgage over that time period. Pay debts off as fast as possible and use that money to make money instead!
3. The only thing you can expect is the unexpected. Prepare for them financially by getting an emergency fund.
4. You need to have that drive to do great things. If you don’t have that drive, you need to create it. Do so by figuring out what is really important to you. What is the goal of doing what you want to do? Why should you sacrifice? We don’t change until we have enough pain and pleasure added up to push us to change. For some, it takes hitting rock bottom. For others, they see the opportunities and go towards the light. For most, however, you are driven by a bit of both of those things! Identify what not having money is costing you (stress, relationships, freedom, etc.) and create that drive!
5. I have never had a budget… but what I have had is complete awareness of my financial situation. This is what Brian is talking about, and I cannot agree more that people that don’t know where their money is going are destined to be people who are always broke.
6. One of the secrets for success I talk about in the book was shared by countless experts: have gratitude. From there, you attract positivity into your life. I know, this is “woo-woo” talk… but try it! Challenge yourself to stop complaining. A few years ago my buddy and I ran a test: every time we complained, we did 25 pushups. I started at 100-150 pushups per day, but by the end of the month was surprised if I had to do any. The results were a lot more happiness, for sure!
7. On a plane, what do the attendants say: put on your own mask first before you help others. I agree with Brian again here. The stronger your own foundation and own financial situation is, the more you’re able to help other people. So, be selfish at first, but then you can be even more selfless! It’s really important.

You can learn some great things from everyone. You can learn what things to do, and what things to not do, as well. So, avoid these 7 things and you will surely not be one of those people who are always broke!

Are you one of them? Which one of these 7 do you have the most trouble with? Comment below!

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