23 Reasons Why You Will Always Be Poor

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Many People are clearly not experts at managing their own finances and end up broke month after month. The cycle of overspending leaves them poor, even if their income means they are considered well above the poverty line. A third of higher-income households — those that bring in $75,000 or more a year — live paycheck to paycheck, found a recent survey from SunTrust Banks, Inc.

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Then there are other factors, like the average per-household amount of credit card debt that stands at nearly $16,000 and dismal savings — 73 percent of Americans have less than $1,000 in their savings account. It raises the question: Why are people with relatively good income always broke?

GOBankingRates talked to 23 personal finance experts, asking them all the same question: What is the No. 1 reason people end up poor or in financial hardship? Click through to find out what problems they say are keeping you broke, as well as what they think you should do to improve your situation.

Many Americans are clearly not experts at managing their own finances and end up broke month after month. The cycle of overspending leaves them poor, even if their income means they are considered well above the poverty line. A third of higher-income households — those that bring in $75,000 or more a year — live paycheck to paycheck, found a recent survey from SunTrust Banks, Inc.

Then there are other factors, like the average per-household amount of credit card debt that stands at nearly $16,000 and dismal savings — 73 percent of Americans have less than $1,000 in their savings account. It raises the question: Why are people with relatively good income always broke?

GOBankingRates talked to 23 personal finance experts, asking them all the same question: What is the No. 1 reason people end up poor or in financial hardship? Click through to find out what problems they say are keeping you broke, as well as what they think you should do to improve your situation.

1. You’re Stuck in a Debt Trap

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“When you’re poor, it’s easy to get stuck in a debt trap because you’re desperate,” said Kristin Wong of Brokepedia. “Whether it’s a payday loan, debt settlement scam, or even just using a credit card for an emergency, it’s easy to make rash decisions when you’re stressed, and these decisions usually keep people broke.”

2. You’re Ignoring Big Debts

 

When you’re broke, stacks of bills and overdue notices are a huge source of anxiety and dread. But avoiding those problems and failing to manage your debts only makes them worse, according to Robert Farrington, founder of The College Investor.

“A lot of young adults are burdened by student loans and other debt, yet they don’t realize there are a lot of options out there for them,” Farrington said. “For example, for student loans, there are tons of programs that can help with lower payments and even forgiveness. But you have to take positive action and seek out these programs.”

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