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8 Scary Simple Acts That Will Keep You Broke Forever

stay broke foreverIf you don’t have $2,000 in your bank account right now, you’re broke. Of course, this isn’t the official definition, it’s just one that I made up based on my experience with people, their spending habits, and the cost of the typical emergency. Considering that only 39% of Americans have $1,000 in the bank, most of you reading this are probably sitting in the “broke” camp. It’s time to wake up, because it’s your simple actions every day that will keep you broke forever.

8 Scary Simple Acts That Will Keep You Broke Forever

Do you get to the end of every month and wonder where the heck all your money went? And then you do the exact same thing the next month…and the next month…and pretty much every month after that? It’s a vicious cycle that won’t end until you decide to end it.

Below are all the things that many of us do without even thinking about it…and it’s exactly why the majority of us don’t have $2,000 stashed away in the bank. These simple actions will keep you broke forever, and even if you’re only doing just one of them, you still might be signing yourself up for a future life of destitution.

1) Buy a New Car Every Few Years

You might impulse on one or two new cars in your life (many of us have, and that’s okay), but if you buy a new car every couple of years (or keep taking out leases) for life, then you’ll likely stay broke forever.


Because it’s one of the more expensive things you can do. We’re talking about $500 a month here…plus high insurance costs and a steep depreciation curve (meaning, your car will go down in value like a rock – roughly in half over the first four years of its life). When it comes time to sell, that $30,000 car (that you paid $35,000 for…after all your interest payments) will be worth $15,000…if you’re lucky.

So think about it, if every 3-4 years you decide to buy a new car, you’re essentially saying that you’re willing to flush $20,000 down the toilet. That’s over $300,000 over the course of your lifetime. AND, if you would have invested that money instead of letting it float into thin air, it could be worth $4.4 million… Hope you really liked those new rides.

2) Max Yourself Out For Your “Perfect House”

Looking to buy a house? If you’re a typical red-blooded American, here’s how the whole thing goes down:

  • You decide you only need the basics for a house – a 3 bedroom, 1.5 bath would be just fine. It’ll probably cost you $150,000.
  • Next, you go to the bank to see if they will actually loan you the money
  • Then, you discover that the bank will actually fork over $300,000 for your home purchase
  • Hmmm…maybe you could use an extra bedroom…and bathroom…and a fully upgraded kitchen…

…In the end, you end up spending about $299,000 on your house…. It sure is dreamy, but it’s costing you your life.

I mean think about it. You take home $4,500 a month, and the bank recommends that you pay them $2,000 of that every month….for 30 years. Ummm…of all the things that will keep you broke forever, this is the one that hurts people the most.

Want to know how much house you can truly afford? My rule of thumb is 2X your income on a 15-year fixed mortgage. If you earn $60,000, you should borrow no more than $120,000 for your house.

kitchen remodel - stay broke forever3) Take Out Home Equity Loans for Your Projects

The vast majority of Americans are terrible at saving money (which is why most of us don’t even have a thousand bucks in the bank), so typically the only way we accumulate wealth is within a forced savings account – ie. equity in our house. Then, years down the road when we realize we don’t have any money BUT we have equity in our homes, we decide to tap into our “forced savings account” to make some upgrades.

…Nevermind the fact that your house is already the nicest one on the block, and therefore any additional upgrades are pretty much worth nothing from a resale perspective. You decide to pull out $30,000 to remodel your kitchen anyway…

Sure, it’s sweet, but keep those habits going and you’ll have absolutely no money….ever.

4) Assume that “Everyone Has Student Loans”

It might be too late for you, but maybe you can save a younger soul that has the same mentality you used to going in.

You know, the one that said,

“Everyone has to get student loans to get through college. It’s just the way it is.”

Do remember what that self-talk led to? That’s right, an exorbitant amount of student loan debt simply because you saw it as a foregone conclusion. Therefore you didn’t bother to take on a full-time job during the summer or fill out all those scholarship applications that you figured you probably wouldn’t get… No, instead, you just kept piling up the student loan debt.

I’m not pointing a finger at you. I did it too. Luckily, I only racked up $12,000, but I could have easily gotten through school with no debt whatsoever. I just had the wrong mentality.

5) Never Learning How to Cook

If you went to McDonald’s (the cheapest restaurant I could think of) once a day for 20 years, how much money do you think you’d shell out to them in total?

Let’s see…

  • $4 per meal (if you order off the cheap menu like I do)
  • 365 visits per year
  • For 20 years….


Honestly, that doesn’t sound quite a bad as I thought it would. BUT, what would that money turn into if it were invested and earned 9%?

  • In 20 years, it would be worth $80,000.
  • If you left it alone for another 20 years until retirement, it would grow to $450,000.


A couple burgers a day is costing you a four Teslas…or a pretty sweet house.

Maybe you’re not eating out at McDonald’s every day, but I bet you’re hitting up a few restaurants a week, and they’re probably more expensive than the $4 meal from our example. The key here is to avoid going out by actually wanting to stay in. Learn to cook and you’ll not only be able to make more healthy food, but you’ll save a crap-ton of money too! Here’s a fantastic resource to get you started.

6) Taking Out 401k Loans

Taking out a 401k loan sounds like a smart idea. I mean, think about it: you’re borrowing money from yourself and paying yourself the interest, which is way better than paying a bank that interest, right?


Taking a loan from your 401k account means that:

  1. You’re no longer earning interest with that money, so it’s actually costing you 8%+ on an average year
  2. You’re risking paying a penalty on that money if you leave the company.

You might get fired, you might want to accept a better job at a better company, or you might simply want to retire. BUT, if you leave your place of employment and you still have a loan out on your 401k, you’re going to have to pay taxes on that withdrawal. AND, if you’re under 59 1/2 years old, you’ll also owe a 10% penalty. Totally not worth it.

If you ignore my warnings and make a habit of this, your retirement account will stay paltry and your future will most likely be ridden with penalties and struggles.

7) Signing Up For 0% Interest Like It’s Free Money

Just because something is offered at 0% interest does not mean you’re getting free money. Yes, I understand that inflation goes up 3% each year and by borrowing money at 0%, it’s basically like you’re earning 3% on that purchase. But believe me, wherever it was that you got 0% interest, that place earned their money from you.

They either:

  • Jacked their price up initially to cover themselves for the year’s worth of inflation, or
  • They’ll catch you with your pants down once the teaser rate ends. You won’t be able to pay the bill and they’ll hit you with all the interest at 20% or more.

If you can pay cash for something, do it. And if you can’t, then I guess you really don’t need that thing now do you? Better learn to live without it.

8) Remain Discontent

The biggest thing that will keep you broke forever…is your mind. If you’re constantly on the lookout for the next best thing, or if you find yourself jealous of your friend’s new car, big house, or shiny boat, you’ll constantly keep yourself in debt and broke.

The best way to wealth isn’t greed. It’s actually contentment. When you no longer feel the need to buy your way to happiness and instead put your money toward your future life, it will grow exponentially – likely into more money than you ever would have ever thought possible.

Related: 9 Things Rich People Do That the Poor Do Not

What About You? Are You Doing Something That Will Keep You Broke Forever?

Like I said, if you’re guilty of just one of the things above, you’re at risk of staying broke forever.

  • Have a passion for new cars?
  • Guilty of buying a new house that cost you far more than you intended to borrow?
  • Do you love the experience of going out and trying new foods?

All these things are costing you, and unless you’re a trust fund baby that gets hundreds of thousands of dollars handed to you for doing absolutely nothing each year…then you’re going to stay broke forever.

Will you be broke forever? What’s keeping you down? 

Battle of the Mind Money Save Money


My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. That is an awesome condensed version of some of the best financial advice ever! I can’t say what doing any of those things results in because I never did any of them and hey, I’ve got way more money than I need now. But as a guy who helped administer the 401k plan at the company I worked at when I worked for a living I can tell you that half of my employees seemed to borrow from their 401k. Which at our company meant they had to stop contributing until they paid it back. My 401k had way over a million dollars in it when I early retired but a lot of my coworkers had very little because they were constantly repaying 401k loans instead of investing in their 401k.

    • Ugh, that’s awful! How could anyone think stopping their contributions could be smart?! I bet you were shaking your head (in your mind) at pretty much every person you saw at work while you were there. Thanks for the comment, Steveark!

  2. Your numbers regarding hiw much to spend to buy a house are a fantasy. Most of them start at double the amounts you said.

    • They’re a reality in the mid-west, my friend. I just bought a 3 bedroom, 1 bath house for $75,000! Sounds like wherever you’re living is keeping you broke!

      • Where are you living

        • Michigan! One of the best places on earth. Great salaries, cheap living! 🙂

  3. you live where you work. shit is expensive where i work

    • but where you work is controlled by….you.

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