Are you feeling like you can never do enough to make ends meet? This feeling of financial insecurity is all too real for millions of people, who struggle with money despite working hard and making sacrifices. But you don’t have to live in this cycle of financial hardship. Understanding the reasons why you are struggling financially is the first step to getting out of it. In this article, you’ll learn 8 key reasons you are unable to manage your money and how to take back control of your finances. With this information, you will be able to create a budget and put together a savings plan that connects the dots between your income and your financial goals.
Without further ado, the following are to top 8 reasons you are struggling with money.
1. You don’t want to learn
Learning is the foundation of every success in life. The more you learn the better as long as what you are learning is contributing to your career or well-being.
If you work in a company, the only way you can make more money is by creating more value in the company. That is your salary depends on the value you are creating. One and only way to achieve this is by learning as much as you can at your job and putting your company’s interests first.
If you are struggling with money because you don’t make enough, you probably don’t add value to your current job or you are working at the wrong place. For example, if you have enough skills but your current job is not compensating you for those skills, you are being underpaid. What you can do is take those skills somewhere else.
If you have worked in a company for a while and you never got promoted to a higher position or never got a raise; it is because:
- You don’t want to learn
- You don’t like more responsibilities
- Have the wrong position
- You are working in the wrong company
- There is not much to learn
- Your company does not like you
- You have self-limiting thoughts
- You never asked for a promotion
To break these barriers, you must know what is holding you back. Once you figure this out, work on it until it is no longer a problem. Even getting paid more money requires that you quit your current job, please do so. Your salary should correlate with the skills and value you are adding to the company. You may be surprised after realizing that the reason you are still down is that you have not learned enough.
You don’t necessarily have to learn things related to your current position.
External skills can help you land another high-paying job in another company or industry.
Related posts:
- 12 tips to get a raise at work and be promoted fast
- 9 ways to increase your income
- How to secure your financial future after landing a job?
2. You are struggling with money due to overspending
Are you struggling with money even if you make enough? If so, you spend more than you are supposed to.
Millions of people never save money which is the reason most of them struggle with money and never achieve financial independence.
Saving money takes practice and it is really easy to fail. Nowadays, it is difficult to save because everything around you is trying to take your money. Additionally, it is even harder to save money due to high inflation. But, with the right discipline, you can change the course of your life and end your financial hardship.
Most of us do not have anything left after the following expenses.
- Rent/mortgage
- Foods
- Clothes
- Health insurance
- Car insurance
- Gas
- Phones services
- Movies subscriptions
- Utility bills
- Taxes
- Etc.
These are a few of the many expenses most of us deal with. You can see that without good discipline, it is very difficult to hold onto the little money you have left.
To overcome your spending desire and boost your savings account, allocate a small percentage of your paycheck into your savings account. Even if it is like $50/mo, you will be far ahead with the right discipline than someone who has not started yet.
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3. Too much debt
Financial struggles usually start with student loans. Student loans are some of the biggest financial traps that millions of people far for. Yes, student loans will help you finish school and probably get a job right after graduation.
The problem is that after graduation, the job is not guaranteed and even if you get a job, it might not pay enough.
In addition, you will have other expenses to take care of such as rent, food, car payments, entertainment, etc. As a result, the money you allocate toward your loans will not be enough to make a difference to your loan outstanding balance.
If you have other loans such as car loans, personal loans, or credit card debts, you will be well in the red. For this reason, every penny you make gets taken by the bank. You might end up borrowing more money just to survive.
What if you can go to school without student loans? To learn more about how to go to school without school loans, refer to the following guide. How to go to college Without A Student Loan?
To further make a difference in your finances, avoid expensive car loans, have a large down payment on your loans, and live below your means.
You might also like:
- Why is it a bad idea to buy a new car?
- 20 clever ways to reduce expenses and increase savings
- 6 reasons you should buy a used car
4. You are struggling with money because you do not invest
The money you make from your 9 to 5 job will never be enough to build wealth and achieve financial independence.
This is because you will be left with almost nothing once all of your expenses are deducted from your active income. Also, taxes eat a big chunk of your income which makes it harder to get ahead financially.
If you are struggling with money it is because you never invested some of it or you made bad investments.
To avoid chasing money your entire life, you must start investing the money you make. Invested money will generate passive income which will be the foundation of your wealth and financial freedom.
When it comes to investing, education, and discipline are the keys to success. You must choose your investments very carefully and have a winning plan.
Assuming that you have decided to invest, where will you invest money? This is a good question since there are a lot of investment options out there. How do you choose where to invest money?
The following article will guide you through different investment options you can consider.
Related: Where To Invest Money: An Investment Guide
5. You are struggling with money because you don’t budget
Many people think that creating a budget is not worth their time. Budgeting, however, is one of the most financial steps to take control of your finances.
Your budget will tell you every dollar you make, where it comes from, how much you spend, and where you spend it. The budget will also make it easy to locate where you are spending more money and where to cut down expenses to increase your savings.
This information comes in handy when trying to optimize your savings or cut your expenses.
For example, if your budget shows you that you are spending too much money on entertainment, you can cancel some of your streaming services to save money.
Trying to manage your finances without a budget is like trying to shoot a target blindfolded.
Are you struggling with money because you never created a budget? If so, start a budget today and stick to it.
The following article will walk you through the budgeting process step by step.
Related: What is budgeting and how does it really work?
6. Your income is not enough
It is possible that you are struggling with money because your income is not enough to cover all your expenses. If you manage your expenses well, live below your means, and have a budget, but are still struggling with money, you don’t make enough.
It is understandable that most people live paycheck-to-paycheck lifestyles. But, if you run out of money all the time, your income might not be enough. If you are running out of money every month, one of the following is true about you:
- You do not have enough active income: Your active income is the money you make only after showing up to work. If this income is not enough to cover your expense, you will struggle with money.
- You are spending more than you make: If your income is enough and you still struggle with money, it means that you engage in excessive spending.
To overcome this issue, increase your income and minimize your expenses. Consider frugal living options to get you out of the financial hole you have dug for a long time. You can also create a side hustle or get a second job.
The following articles can help you increase your income and end your struggle with money.
- Frugal Living: 19 Tips That Will Save You Money
- 49 easy ways to make money fast: A complete guide
- 20 easy ways to make money from Home in 2023
7. You have family issues
One of the many reasons people struggle with money is family issues. For example, misusing family funds or a divorce can easily push you on the edge financially. These are common issues in modern family lives.
Some of the family money issues can be fixed by mutual understanding. Other financial issues can only be resolved by a third-party entity such as a court or a person.
If this is the case for you, consider finding a solution that best fits your situation. For example, you can talk to your spouse about the benefits of saving instead of spending.
You might also like: How to talk to your spouse about budgeting?
8. You have been fired/laid off
Getting laid off can happen to anyone at any time with or without a reason. Companies lay off employees dues to mediocre performances or economic conditions.
Whatever the reason you got laid off, it is not the end of your world. You can always bounce back and get on your feet.
You must have the gut to move forward and know that there is light at the end of the tunnel.
If you recently lost a job, update your resume and cover letter, start networking, and apply to as many jobs as you can. You can also start with a simple job just to get your feet in the door. You must also work on your interview skills to prepare yourself ahead of time before an actual interview comes along.
To avoid running out of cash, get a short-term job or a low-paying job. You can also apply for government assistance while searching for jobs. Remember that you can always go up as long as you make the first step.
