We all have that broke friend who never has any money, no matter how hard they work or how much they earn.
It’s easy to assume it’s just bad luck or poor choices, but according to psychologists, there are subtle behaviors that can contribute to chronic financial stress.
These behaviors often go unnoticed, but they reveal a deeper pattern of thinking and decision-making that keeps people stuck in a cycle of financial instability.
In this article, we’ll explore 8 of these subtle behaviors—patterns that impact not just your wallet, but your mindset about money. These insights will help you better understand your broke friend, and prevent you from making the same money mistakes!
1) Living paycheck to paycheck
Money matters can be as unpredictable as emotions.
One moment, you’re on top of your finances, and the next, you find yourself barely scraping by until the next payday. It’s a rollercoaster ride that never seems to end.
But for people who always seem to be broke, this isn’t an occasional hiccup. It’s their everyday reality.
According to a psychologist, living paycheck to paycheck is one of the key subtle behaviors of those who constantly struggle with money.
They’re stuck in a cycle, waiting for the next influx of cash to cover their immediate expenses, with little thought about the future.
In essence, their finances are on a constant lifeline. And that’s not just stressful – it’s also a telling sign of their deeper financial woes.
2) Ignoring financial realities
We all have our ways of dealing with problems. Some face them head-on, while others prefer to bury their heads in the sand.
And let me tell you, I’ve been there.
There was a time when I was drowning in credit card debt. The bills would arrive, and I’d toss them in a drawer without even opening them.
Ignorance was my bliss, or so I thought.
According to psychologists, this is another subtle behavior of people who always seem to be broke – they ignore their financial realities.
It’s not that they don’t know they’re in a tight spot, but acknowledging it makes it all too real. So they avoid it, creating a false sense of security around their money situation, just like I used to.
It took me a while to realize that ignoring the problem wouldn’t make it disappear. It was a tough lesson learned, but an essential one for getting my finances back on track.
And if you can recognize this behavior in someone, you might just be able to help them face their financial truths before it’s too late.
3) No savings to speak of
Savings are a lifeline, a safety net, a buffer between you and life’s unpredictable turns. They can be the difference between weathering a financial storm and sinking under its weight.
But for those who always seem to be broke, savings are often non-existent. Every cent earned goes straight into covering immediate expenses, with nothing left over for the rainy days.
According to a report by the Federal Reserve, nearly 40% of Americans would struggle to cover an unexpected $400 expense.
That’s a staggering number of people living on the edge of financial disaster!
This lack of savings is not just a symptom of being broke. It’s also a cause. Without a financial cushion, any unexpected expense can send them spiraling into debt.
4) Frequent impulse purchases
We’ve all been there – that moment when you see something you just have to have and before you know it, it’s in your shopping cart.
Impulse purchases can be a fun occasional splurge, but for some, it’s a regular habit.
Those who always seem to be broke often fall into the impulse buying trap. It’s like a quick fix, a momentary high that masks the underlying financial stress.
But here’s the catch – these impromptu buys often lead to buyer’s remorse and an even tighter financial squeeze.
It’s like feeding a sweet tooth with candy. The immediate satisfaction is great, but the long-term repercussions on your health, or in this case, your wallet, can be dire.
5) Avoiding money talks
In my experience, one thing that can quickly turn a casual conversation into an uncomfortable one is the topic of money.
It’s a subject that often makes people squirm, and I can’t say I haven’t been one of them. I used to avoid money talks like the plague, especially when my finances were in a rough spot.
This is another behavior people who always seem to be broke often display – they steer clear of discussions about money. It could be out of embarrassment, fear, or simply not wanting to face their financial reality.
But here’s what I learned: avoiding these conversations only perpetuates the problem.
For me, starting to talk about money was the first step towards getting a handle on my finances.
6) Generosity to a fault
Generosity is a virtue, no doubt about it. But sometimes, it can also be a mask for financial instability.
Those who always seem to be broke often overcompensate by being overly generous. They’re the first ones to pick up the tab at dinner or shower others with gifts.
It might seem like they’re in a good financial position, but in reality, they could be stretching their finances thin. It’s a way of maintaining appearances, of hiding their monetary struggles behind a facade of generosity.
It’s like putting on a brave face when you’re hurting inside – except it’s your wallet that’s hurting.
So next time someone insists on picking up the tab despite their financial woes, take a closer look. Their generosity might just be a subtle sign of their financial struggle.
7) No financial goals
Having financial goals is like having a roadmap for your money. It helps guide your spending, saving, and investing decisions towards a defined destination.
But for those who always seem to be broke, this roadmap is often missing.
Without financial goals, they may drift through life without a concrete plan, dealing with financial issues as they arise, instead of proactively managing their finances.
This lack of focus can lead to aimless spending, where money is spent on short-term wants rather than long-term needs or savings. It’s easy to slip into a cycle of living paycheck to paycheck, never quite able to break free from the constant financial strain.
Setting clear financial goals—whether it’s building an emergency fund, paying off debt, or saving for retirement—creates a sense of purpose and control, empowering you to make smarter, more strategic financial decisions.
8) Frequent borrowing
While occasional borrowing is a part of life, frequent borrowing can be a red flag signaling financial trouble.
Those who always seem to be broke often find themselves in a cycle of debt. They borrow to cover immediate expenses, but without a solid plan to pay it back, they end up borrowing more.
This creates a cycle of debt that’s hard to break—each loan leads to the need for another, making it feel like they’re digging a hole that only gets deeper.
Over time, this pattern can lead to mounting interest, late fees, and increased stress, making it even harder to escape the financial strain.
Without a strategy to manage their finances and break the borrowing cycle, they remain trapped in a continuous loop of financial instability.
Final reflections
While some of these money habits may seem small, they can have a significant impact on your overall financial well-being.
In the words of financial author Dave Ramsey, “You must gain control over your money or the lack of it will forever control you.” It’s a powerful reminder that awareness is the first step towards regaining control.
Taking control of your financial habits isn’t about having more money—it’s about making smarter, intentional decisions with the money you already have.
By setting clear financial goals, avoiding impulsive spending, and learning to manage money more mindfully, it’s possible to shift from a reactive approach to a proactive one.
