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By Tom Corley

10 bad habits that will keep you from getting rich

Successful, wealthy people do not just suddenly become rich and successful.

Success is a process that takes place over many years.

Long before most wealthy people become wealthy, they make a habit of living below their means.

The following is a list of ten spending habits I’ve uncovered during my five-year study of the rich and the poor that will prevent you from ever achieving financial independence:

1. Charging ordinary living expenses on a credit card

If you are unable to afford to meet your ordinary living expenses and must resort to the use of a credit card to meet your monthly living expenses, you are, by definition, living above your means.

Credit Card

Accumulating credit card debt is the third leading cause of bankruptcy, behind job loss and medical costs.

2. Spending more than 25% of your net income on housing costs

Housing costs include rent, mortgage, real estate taxes, utilities, insurance, repairs, and maintenance.

3. Spending more than 15% of your net income on food

This includes groceries and does not include prepared food. Prepared food is part of your entertainment budget. 

4. Spending more than 10% of your net income on entertainment/gifts

This category includes bars, restaurants, movies, music, books, gifts, etc.

Eating out and any prepared food you purchase is part of your entertainment budget.

5. Spending more than 5% of your net income on car expenses.

Car expenses include a lease, loan, insurance, gas, tolls, registration fees, repairs, and maintenance.

6. Spending more than 5% of your net income on vacations


7. Spending any money on gambling


8. Going over the top on gift-giving

Gifts are part of your entertainment/gift budget. Sticking to your 10% budget will prevent you from going overboard on gift giving.

9. Spending more than 5% of your net income on clothing

More than a few of the wealthy in my study had the Rich Habit of buying the bulk of their clothes at goodwill stores.

Many Goodwill stores sell high-quality clothing at a deep discount.

It may require spending a few more dollars on a tailor, but it’s well worth the additional cost.

10. Impulse spending

Spontaneous spending is never a good idea.

You need to take the emotion out of your spending habits.


There is always time to plan and shop before your spend your hard-earned money.

Maintaining a spending budget for various categories and getting into the habit of writing down everything you spend will keep you on the right track.

It will also open your eyes for the first time.

You will be shocked to find out how much you spend on certain budget categories — and that’s a good thing.

Getting control of your spending is not an easy task.

Once it becomes a daily habit, however, it gets much easier.

About Tom Corley Tom is a CPA, CFP and heads one of the top financial firms in New Jersey. For 5 years, Tom observed and documented the daily activities of wealthy people and people living in poverty and his research he identified over 200 daily activities that separated the “haves” from the “have nots” which culminated in his #1 bestselling book, Rich Habits – The Daily Success Habits of Wealthy Individuals. Visit the website:

I agree with all of the points made! Budgets are the best tool to show you where your money is going (kind of like a report card), and only once you see it in black & white, will you be able to make better decisions about how you're going to sp ...Read full version

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