Financial Red Flags: 7 Financial Habits Keeping You Broke (Without Realising It)
You feel a little sad every payday, wondering where your money goes. It leaves just as fast as it comes in, and you’re left asking yourself why you earn enough but still can’t seem to manage it.
It’s frustrating when you work hard and try to be responsible, yet money always feels like a problem. You don’t splurge every day, but somehow, you’re stuck in the same cycle month after month. You tell yourself it will get better “next month,” but it never really does.
Here’s the truth: it’s not just about how much you earn, it’s about what you do with it. Sometimes, the very habits we ignore are the ones quietly draining our wallets.
But don’t worry. I’ve got you. In this post, I’ll walk you through 7 everyday money habits that are keeping you broke without you even realising it, and how to break free. No stress. No shame. Just simple steps to help you take control of your money and start building the financial life you deserve.
1. Avoiding Financial Education
Most of us didn’t learn how to handle money in school. But continuing to ignore financial education only keeps you stuck. When you don’t understand how money works, you’re more likely to make poor decisions, live paycheck to paycheck, and rely on others to “save” you.
Financial education isn’t about mastering the stock market overnight. It’s about understanding the basics: budgeting, saving, debt, and making money work for you.
What to do instead:
Pick one simple topic to learn each week—like how to track your spending, how interest works, or how to set money goals. Podcasts, YouTube channels, blogs (like this one!), and free online courses are goldmines for learning. One hour a week can change your money story.
2. Not Budgeting
Think of a budget as your financial GPS. Without it, you’re just driving blind—and wondering why you’re always lost and broke.
Many people skip budgeting because it feels overwhelming or restrictive. But the truth? A good budget gives you freedom. Freedom to spend on things you love without guilt, because you’ve already planned for it.
What to do instead:
Start simple. Track your income and where your money goes each month. Use tools like Google Sheets, budgeting apps, or even pen and paper. Try the 50/30/20 rule:
- 50% for needs
- 30% for wants
- 20% for savings and debt
The goal isn’t perfection—it’s awareness. Once you see where your money is going, you can start telling it where to go.
3. Lifestyle Inflation
You get a raise or a better-paying gig, and boom, you start spending more. New clothes, better restaurants, weekend trips… because you “deserve it,” right?
You do deserve nice things. But lifestyle inflation, upgrading your lifestyle every time your income increases, can keep you broke, even with a higher paycheck.
What to do instead:
Set a rule: when your income goes up, keep your expenses the same for at least 3 months. Use the extra money to build savings, pay off debt, or invest in your future. You can still treat yourself—just do it intentionally, not automatically.
4. No Emergency Fund
Life happens. Phones break, cars act up, or medical bills pop out of nowhere. If you don’t have an emergency fund, every surprise becomes a crisis—and that’s when people fall into debt traps or panic spending.
What to do instead:
Start small. Even 500 Ksh or $20 in a separate account is better than nothing. Set a goal to build at least one month’s worth of expenses over time, then work your way up to 3–6 months. The trick? Keep it separate and only use it for true emergencies, not sales or cravings.
5. Impulse Buying
You’re scrolling through TikTok or walking through the mall, and suddenly—boom—you’ve bought something you didn’t plan for. It’s fun in the moment, but impulse spending slowly eats away at your savings and budget goals.
What to do instead:
Use the 24-hour rule: if you see something you want to buy that’s not in your budget, wait 24 hours. Most of the time, you’ll realise you don’t need it. You can also create a “fun money” category in your budget so you can enjoy spending without derailing your goals.
6. Living Beyond Your Means
This habit is sneaky. You may not think you’re overspending, but if you’re relying on credit cards, loans, or borrowing just to get through the month, it’s a red flag.
Living beyond your means creates stress, debt, and keeps you trapped in the paycheck-to-paycheck cycle.
What to do instead:
Get clear on your real monthly income and expenses. Cut back where you can—ditch subscriptions you don’t use, cook more, or downsize if necessary. Focus on living within your means now, so you can build the life you really want later.
7. Falling for Get-Rich-Quick Schemes
We all want financial freedom, but there’s no magic shortcut. Pyramid schemes, sketchy investments, or “double your money in 24 hours” scams will only leave you broke and disappointed.
What to do instead:
If it sounds too good to be true, it is. Focus on building wealth slowly and sustainably:
Learn real investment basics
Build multiple income streams over time
Grow your skills
Trust the process. It takes time, but it works.
Final Thoughts
If any of these habits hit a little too close to home, you’re not alone—and you’re not a failure. Most people were never taught how to manage money, especially in a way that feels practical and relatable.
But you can change your money story—one habit at a time.
Start small. Choose one area to focus on this week. Make it a goal. Track your progress. Celebrate your wins. You’ve got the power to stop being broke, build healthy money habits, and take control of your finances for good.
