10 REASONS Why You'll Always Be Broke #Best Education Page #Online Earning

do you ever look around and wonder why

so many people struggle financially most

people have some form of education and

many work full-time jobs yet they still

complain that they never have any money

left at the end of the month why is that

hopefully I didn't just describe your

current financial situation but whether

you're living paycheck to paycheck or on

your way to becoming rich there are

certain habits you must be aware of that

can limit your ability to grow your

wealth and in this video I will share

with you ten reasons why you will always

be broke and make sure to watch until

the end as the final reason is one that

you don't want to miss believe it or not

millions of Americans live beyond their

means between the rise in social media

and the ever-increasing number of new

gadgets - by resisting our temptations

to spend can be nearly impossible

unfortunately not being able to control

these temptations can have dire

financial consequences in fact a recent

survey found that about 1/3 of people

ages 30 to 49 had more credit card debt

than savings imagine being middle-aged

and having absolutely nothing in your

bank account to show for your years of

work I think the question most of us

need to ask ourselves is what drives us

to spend so much behavioral economists

have been studying the nature of

spending for years and have identified

the 10 main reasons people overspend

which I will now outline reason number

one you're not selective in your

spending in a world of scarcity choosing

one thing means giving up something else

when we spend money on one thing it's

money that we cannot spend on something

else now or later for instance if you

choose to attend a four-year college

program then you're giving up the salary

you could be making if instead you work

full-time during these four years or if

you have only $1,000 and buy a new TV

then the opportunity cost is spending

that same money to buy a new computer in

short there's an opportunity cost

everything we do and that cost is

expressed in terms of the next best

alternative for example the true benefit

of buying a new car can be assessed in

terms of other equally significant items

we could have done with the money

unfortunately when the next best

alternative option is considered people

tend to lack the ability to abstain from

choosing between either one and instead

decided by both often the latter being

on credit so in the example I just

provided the same person would not only

buy the new TV

with $1,000 he had but would then charge

the new computer to their credit card

causing them to overspend to satisfy the

temptation to have both devices as this

behavior becomes more routine the

overspending only gets worse making your

chances of building wealth slim to none

reason number two you don't see the

bigger picture have you ever been gifted

money for clothes or to put towards a

new phone and while you're drowning in

debt you still use that money for its

intended purpose

you see most of us perform mental

accounting by dividing our money into

separate mental accounts such as

accounts for food clothes rent school

supplies and play money and when done

right we spend based on the dollar

values we attribute to these categories

in short we only consider the

opportunity cost within a specific

account without looking at the bigger

picture for example you may have a line

of credit with $5,000 outstanding that

you should put your gift money towards

but because it was gifted with the

intention of being used for a new phone

or outfit you have mentally tagged that

money into its respective account and

will choose not to use it for more

beneficial purposes instead you should

be looking at your finances using a

holistic perspective when you have a

cash inflow assess where the money will

be best put to use rather than

allocating it using mental accounting

reason number three you overspend on

special occasions have you ever been on

a diet and decided that just for one

night you would break your diet to

celebrate a special occasion it could be

your birthday a holiday or just a random

Friday night and while it feels good to

indulge from time to time unfortunately

those calories still count well the same

phenomenon takes place when it comes to

spending we tend to overspend on special

occasions birthdays are Christmas

because we don't keep track of just how

many of them we have consequently we end

up spending over our normal budget

failure to incorporate an exceptional

purchase into our budget as one in a

series of special purchases can

encourage overspending luckily you can

budget for infrequent expenses by

creating special savings accounts

earmark specifically say for birthdays

so that you don't hinder your savings

progress by enjoying yourself from time

to time reason number four you overvalue

present pleasure present bias occurs

when individuals place extra weight on

more immediate rewards than those in the

future for example my future self may

want to buy a home but my present self

wants to splurge on a tropical vacation

it often seems illogical to be giving up

the potential for large future awards in

exchange for momentary pleasures the

reality is that the further into the

future the reward is the harder it is to

keep its value in mind in fact this is

the reason most people fail to put away

the money required to fund their

retirements while most people could be

millionaires in their retirement years

by investing consistently from an early

age they instead succumb to spending on

$8 coffee's in the newest iPhone in

essence the more we disregard our long

term interests in favour of immediate

gratification the more likely we will be

to have an overspending problem which is

why you should write down your short

medium and long term financial goals and

review them daily so that you can keep

those longer-term rewards at the

forefront of your mind

reason number 5 the east of credit card

spending in addition to the present bias

that makes us overvalue our current

spending versus future rewards the use

of credit cards to pay also increases

the potential for overspending you've

probably experienced it yourself that

it's much easier to swipe your credit

card to pay for something then it is to

open your wallet and pull out cash and

this phenomenon has been researched

extensively in fact a 2001 study found

that shoppers who rely on credit cards

is their form of payment compared to

those who only pay with cash spend a

hundred percent more hence making

overspending that much easier and this

makes sense when you pay with cash you

can literally see your funds diminishing

whereas paying with credit doesn't cause

the same emotions to resonate so if you

want to spend less take out the cash you

want to spend every month and once that

amount is gone you must wait until the

following month to make any of your

desired purchases reason number 6 you

don't believe in yourself what you

believe about this statement will

determine if it's true if you believe

you're always going to be broke you're

probably right and guess what what you

believe has the direct influence on what

you do so if you believe you're always

going to be broke you're probably not

actively seeking ways to get ahead

luckily your attitude is something you

have control over and when that is

paired with positive action then

achieving financial success is well

within the realm of possibilities take

Elon Musk is an example most people

doubted that he would be able to build

his own aerospace company but the

business magnate has been able to not

only build SpaceX to the size it is

today but it's also Sina's own rockets

into space proving all those

non-believers wrong so when it comes to

you and your money believing yourself

if you're in debt start making payments

to lower your balance if you've been

putting off investing for retirement

then set up a 401k at work believ an act

towards success and I promise you will

achieve it reason number seven lack of

willpower willpower refers to effortful

control that is exerted with the purpose

of controlling our impulsive behavior I

like to look at willpower as a resource

that we deplete over the course of every

single day you start each day with a

tank full of willpower and as its

depleted you become more inclined to act

on impulse and are more likely to be

swayed by desires urges and cravings

although you may regret them in the long

run

this insight suggests that shoppers who

are tired or distracted will likely

increase impulse purchases this is why

you need to ask yourself how much

willpower you have available in making

financial decisions if you're well

rested and relaxed you will be in a much

better situation to make a good spending

decision than if you had just finished a

full day's worth of work and are

stressed out by all the work you foresee

having the following day let your

willpower be a tool and not your

kryptonite reason number eight retail

therapy

some people relieve stress by working

out others talk out their feelings with

friends and sadly some people resort to

compulsive spending to overcome their

emotions while detrimental to your bank

balance the dopamine spike that spending

offers has been proven time and time

again to provide an immediate

improvement to a Shoppers mood

you see shopping allows people to

visualize themselves in a better life

where they're dressed in nice clothes

are surrounded by nice things

buying makes these visualizations a

reality there's no doubt that this form

of therapy works which is why so many

people partake in this behavior in fact

a 2016 survey found that 96% of adults

and 95% of teens participate in retail

therapy making spending a mood enhancing

tool used by just about everyone reason

number 9 shopping addiction beyond

periodic retail therapy lies the

potential for developing a real shopping

addiction a shopping addiction is

characterized as an impulse control

disorder and about 6% of the population

could be considered compulsive buyers

now a person cannot be classified as

either a compulsive buyer or not this

disorder exists along a continuum in

reality there are excessive shoppers and

then there are compulsive

they buy things they do not need and

often cannot afford and place their work

their families and their mental health

in jeopardy some of those people who end

up in bankruptcy or binge buyers

suffering from a disease similar to

alcoholism the most effective first step

for treatment is to identify why and how

you're shopping initially became a

problem experts suggest starting a

journal to keep track of your triggers

which is the first step in tackling this

overspending issue reason number 10 you

justify your unnecessary spending you've

just finished another grueling 40-hour

work week at a job you hate and the only

thing you can think about is going over

to the mall and treating yourself to a

new outfit that you can wear out on the

weekend does this sound like you I hope

not but unfortunately this is the

mindset that many people have they

absolutely must find some sort of relief

from their 9 to 5 grind and one of the

only ways they know how to make

themselves feel better is by turning to

retail therapy

however the spending high you gain from

swiping your credit card will not

resolve your discontent with your job or

your life and will in fact only make

things worse

therefore if you want to ditch the broke

mindset then stop justifying unnecessary

purchases and start putting that

hard-earned money to work so that you

can make strides in your path towards

financial success thank you guys so much

for watching give us a big thumbs up and

subscribe with that said I'll see you in

the next one

#Best Education Page #Online Earning

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