The average American makes under 60k a year. After taxes that’s anywhere under 49k annually. Many Americans, because of this fact just can’t seem to get out of living paycheck to paycheck. They have serious money problems and it’s been adversely affecting their families. They have to move their kids and family from school to school and house to house because every year they can’t afford what they had last year. These same Americans pay their bills and have NO MONEY left over and can barely make it before their next paycheck. If anything unexpected happens it could result in them being negative, adding more debt, or even homeless and this causes stress and tension in the household.
This article will discuss the 3 main reasons why many Americans are stuck financially and just can’t seem to get out of their current situation.
The way these Americans think about money blocks them from moving forward financially. Sayings like, “Money is the root of all evil, and money isn’t everything” can condemn you a poor individual forever. Money is not the root of all evil; it gives room and opportunity to show who you really are. Who can you help if you need help yourself? If you want to help your family, your kids, your church, or even a random person you’re going to need money. Yes, you can volunteer for things but if you want to make a lasting change in your situation or someone else’s situation you’re going to need money. And if money doesn’t matter to you then why are you so concerned and protective of the little that you have?
Another expression commonly used is, “money won’t make you happy. “I agree with this statement, but I believe it should be followed with, “having no money won’t make you happy either.” Because having no money whether it be for a week or for the foreseeable future is not a good experience at all. Who wants to work till they’re 70 or stress about if they will have enough money to fill up their car at the end of the month? Yes, you can’t buy happiness with money, but achieving financial freedom makes life much more enjoyable. Knowing what to do to get, keep, and grow money makes your life and your family’s life easier and much more satisfying.
Expressions like these and the mindset that comes with them, have been passed down generation to generation as an excuse for why things are the way they are. These expressions are wrong and are usually said by those who have no idea what they are doing financially. If you change the way you think about money; you will change your life forever. You must get your advice from someone other than your broke parents and friends…which brings us to problem number 2.
2. Wrong Information
There are many people out there famous or not who are just giving the middle and lower-class America WRONG information. If they didn’t get paid giving false financial advice I’d be surprised if they had any money at all. Many Americans are stuck making the wrong decisions and that’s why they are stuck in their current situation.
The very first thing these financial advisors teach you to do is save and pay off debt. If your making under 50k a year you shouldn’t be trying to save. What can you save? The cost of living in many cities is more than you make. Many Americans are not in debt because they chose to. They are in debt because they had to. So, what is saving money going to do for you besides starve you? You need MORE INCOME! And why isn’t anyone saying that? Because they don’t believe that you can go out there and make money. If you want to change how your living you want to make more money.
Another thing keeping many Americans poor are the get rich quick schemes. You see it everywhere. “Grow rich by saving and investing in the stock market!” Or that every millionaire has multiple streams of income, so you should too. 94% of traders lose money and if you only have 10k saved then you shouldn’t be investing anyways. Having multiple streams of income, if not done right, can get you fired quick and homeless a lot quicker. DO NOT go for the get rich quick, go for the get rich FOR SURE!
3. Financial Mistakes
There are many Americans who are making a “good amount” of money but somehow are still broke. They make over $100k a year have a nice house, two cars, and the wife is happy. However, they are 30k+ in credit card debt and living paycheck to paycheck. How does this happen? It’s a mix of their mindset, incorrect information, and how they handle their finances.
Excessive spending after every paycheck is really damaging financially. Going to the clubs and buying rounds for you and your friends or just simply going out to eat every night really adds up and could put everything you’ve worked for at stake. Creating some financial goals and adding a budget to those goals can really turn your financial situation around. If you have money left over from your budget, then you can buy and do what you please with that money. And you can spend that money knowing that you and your home are taken care of.
Living and buying things which you can’t afford and having to borrow the money for these things WILL make you poor. Using borrowed money not only makes what you are buying more expensive, but it also ties up future cash. Debt can be used to your advantage but if its used wrong it can destroy everything.
Keep away from this horrible mindset, incorrect information, and the blowing of money you either have or money you had to borrow. Getting and keeping your finances in order is a very important part of life. The best way to correct yourself and to stay on the right path is to know exactly what every single dollar is going, and a budget helps with that. It can be boring but its well worth it.