Being broke is miserable, and you must be left wondering, “Why am I poor?”
Lacking sufficient money to live comfortably or normally in our society is never a good thing.
One thing is for sure, most of us have had moments in life that led to not being financially stable at one point or another.
The problem with the U.S. economy is there are too many poor people.
But it could be anything, for example, maybe you had a rash of medical bills pile up, made poor financial decisions, got laid off, received an eviction, or collection bills piled up which left you knees deep in debt?
Whatever it is, today I am here to give you 13 steps to help you stop being poor.
In a hurry? Let's get right to it.
Why Am I Poor?
If you want to learn how to stop being broke, it's important to learn why you are in that situation, to begin with. According to the Cato Institute, people are poor for some common reasons which I've explained below.
Laws
Government policies may keep impoverished citizens at that level. In fact, scholars at Vanderbilt University have estimated that overcriminalization and the bias against the poor and people of color in our criminal justice system have increased poverty rates by as much as 20 percent.
Education
Numerous studies show that educational achievement is a key determinant of financial success. Some public schooling in low-income areas are doing a bad job of educating children. If you come from a government-run school and grew up in poverty, you are left with little alternatives than those who are more privileged.
Savings
One of the first steps in learning how to get out of being poor is by saving more, not your consumption. TV and media portray a spending economy that doesn't empower the poor to save money. They rely on instant gratification and do not realize the importance of saving money and building an emergency fund to avoid debt spirals.
How To Stop Being Poor
Now, let's get started. Here are actionable steps to take to get out of poverty and to help rebuild your financial situation in 13 easy steps.
If you implement them over the long term, you may even start building real wealth and putting money in your pocket as your financial situation improves.
1. Don't Settle for Less
This may be tough to hear but your life is determined by the things you do on a daily basis.
Including today, after reading all of these steps below how many actions will you really take?
Most successful people in life aren't lazy, they work hard for what they have and you need to as well.
Never settle, and continue to educate yourself and learn how to grow and better your situation for you and your family. You may benefit from hearing about living below your means.
However, there are support services for low-income families all across the United States.
Federal assistance lifts millions of people, including children, out of poverty and provides access to affordable health care.
If this is something you are not already utilizing that should be your first step.
2. Figure Out How Poor You Are
To better your financial position it's important to get an overall picture of your financial health.
This really means figuring out your net worth. If you do not have a starting point, how can you grow real wealth in the long term?
I would suggest using a free personal finance tool called Empower that tracks all of your bank and credit card accounts so you know exactly where you stand.
You can get started for free here.
3. Start Saving More
Just because a company quotes you a price doesn’t mean it’s the best one they can offer you. Start by contacting the companies with which you have a regular bill, for example:
- Phone
- Insurance
- Cable
- Credit card
If you contact them and explain that you have been offered a better deal elsewhere, they may be able to negotiate a better price for you, especially if you are a long-term, loyal customer.
If they can’t offer you a better deal, it may be worth switching providers.
4. Lower Your Monthly Bills
Managing your money effectively is one of the most important steps to stop being broke, and Rocket Money can be a game-changer in this area.
Rocket Money is a powerful app designed to help you take control of your finances. It can track your spending, identify unwanted subscriptions, and even negotiate lower bills on your behalf.
By providing a clear picture of where your money is going, Rocket Money makes it easier to cut unnecessary expenses and save more each month. With features like budgeting tools and alerts for upcoming bills, you can avoid overdraft fees and plan your spending more effectively.
It's a practical, user-friendly solution for anyone looking to break the cycle of living paycheck to paycheck.
- Helps lower your internet, phone, and cable bills automatically
- Trusted by over 5 million users to cut monthly expenses
- Contacts providers to find discounts and hidden savings
- Saves users an average of $300 per year
- Charges no upfront fees — you only pay if they save you money (40% of the savings)
- Tracks and cancels unused subscriptions effortlessly
5. Ignore Online Scams
There is nothing more embarrassing than falling for the online scams that claim you can earn thousands of dollars a month by clicking a link and investing a couple of hundred dollars.
Similar to fad diet pills and online gambling, very few ever make a cent, let alone a living!
What a joke! Don't fall for this.
Becoming rich/comfortable takes time, patience, and discipline, so instead of investing your hard-earned cash into what adverts call “online deals”, put that money in some index funds instead.
If you're not already doing so, you can learn more about investing in this beginner’s guide to investing.
Every dollar you can manage to save is a dollar you can invest!
6. Find New Income Sources
If you wanted to make more money to pay off debt or bills, why not consider earning side income outside of your 9-5 job?
An estimated three percent of America’s workforce now consists of telecommuting employees or people who work from home, according to a survey conducted by FlexJobs.
How does an extra $1,000 a month sound? You can get there and with the most lucrative online jobs and flexible part-time jobs.
7. Shop at Stores That Give You Cash Back
If you’re doing your weekly grocery shopping without taking advantage of cash-back deals, you’re leaving easy money on the table.
Fetch makes it simple to change that. This app rewards you with points for scanning your receipts from grocery stores, restaurants, and more — no matter what you buy.
The best part? You can redeem those points for gift cards to your favorite retailers, making Fetch a fun and easy way to save.
Unlike other apps, Fetch doesn’t require you to pre-select offers. Simply snap a photo of your receipt, and you’ll start earning. It’s that easy.
Ready to get started? Sign up today and earn a $2 bonus just for scanning your first receipt. Don’t miss out!
- Snap receipts to earn points for every purchase
- Redeem points for gift cards to top stores like Amazon
- Get a $2 bonus with promo code C1JAV
8. Start Investing Even if You Have Little Money
If you’re tired of feeling broke, one of the best ways to take control of your financial future is by starting to invest — even if you don’t have a lot of money.
Acorns makes it easy to begin with as little as $5, and it’s perfect for people who are just starting out. By investing just $50 a month, you could grow your portfolio significantly over time.
For example, with an average annual return of 8%, that $50 monthly contribution could grow to over $74,000 after 30 years!
The best part? Acorns is currently offering a $20 sign-up bonus when you create an account and make your first investment. That’s an easy way to kickstart your journey toward building wealth. Don’t wait — your future self will thank you.
- Get a $20 bonus when you start investing with Acorns today!
- Grow your wealth effortlessly—Acorns invests your spare change automatically.
- Build your portfolio with dividend-earning investments made simple.
9. Join the Gig Economy
If you’re free on nights and weekends, you can turn that time into extra cash with gig economy jobs like food delivery. With apps like DoorDash, you can earn money by delivering meals to people in your area. If you have a car, it’s a flexible and convenient way to make extra income on your own schedule.
Many people do food delivery full-time, so it’s definitely possible to do it as a side hustle and easily make $100 a day or more.
The best part? Signing up is simple, and you can start earning quickly once approved. If you're looking for a reliable way to make extra money, consider becoming a delivery driver with DoorDash.
Earn extra money for your short-term or long-term dreams with DoorDash. As a Dasher, you can be your own boss and enjoy the flexibility of choosing when, where, and how much you earn. All you need is a mode of transportation and a smartphone to start making money. It’s that simple.
10. Sell Your Unwanted Items
Do you have an old phone or laptop lying around? I know most of my friends and family do. Decluttr will pay you for them! Or you can try listing your junk on eBay or sites like Craigslist, but this can prove to be quite the hassle.
Either way, selling the things that you don't use anymore can help you earn some extra money. Plus, if you like selling things, you can even turn it into a little side hustle. A lot of people flip items for spare cash on the side.
In fact, I've made thousands flipping iPhones which helped me pay off my student loans.
11. Check Your Credit Score
This can definitely lead to more a prosperous financial future.
By checking your credit score and working to fix any discrepancies or building it higher you can pay less in interest, which will increase your net worth.
If you don’t know your credit score, you can use free services like Credit Sesame that gives you your score for free. You can find out your score in under a minute!
12. Make Extra Income with a Spare Room
There is a company out there called Airbnb that can net you over $1,500+ a month just by listing your spare room just a few nights out of the month.
Airbnb is a free room booking app for your phone. I really mean free all around – free to join and they don’t charge any fees for you to list your spare room.
See how much people are making from listings in your area, then make your own.
13. Build Your Emergency Fund
Not having an emergency fund is a huge mistake that poor people often make.
And it's odd how people find excuses as to why they don’t have an emergency fund. Common excuses being that the money can be used for your retirement or to pay bills.
I would suggest that after all basic needs are meant you should start saving for an emergency fund which is typically 6-month living expenses.
You’re likely to get more debt if you don’t have an emergency fund readily available and liquid.
You can build up by finding ways to make extra income.
Tired of Struggling Financially?
Have you figured out your answer to “Why am I poor?”
Just remember that you should always live beneath your means and making more money can be helpful.
Also, if you aren't utilizing money-saving apps then do some research on them as they can make saving money easy even if you're broke.
If you are strapped for time, here are some popular money-saving options that we have reviewed recently:
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Our Pick
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Pros:
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- Automatically invests spare change
- $20 new user bonus
- Cash back at select retailers
- Free budgeting tools
- Retirement planner
- Free portfolio advice
- Robo plus human advisors
- Get control over your subscriptions
- Stay on top of your spending
- Put your savings on autopilot
I recently published a new article that details how companies are giving away free money, crazy right? You can learn how to get free app bonuses here.
