No one likes being broke, and it’s stressful, uncomfortable, and counterproductive to achieving your financial goals. While there may be some things about your finances that are outside of your control, like whether your boss is willing to give you a raise, you can control some other things that can help you repair your financial state.
You can unknowingly prolong your financial lull by continuing to make poor financial decisions, such as spending money when you should instead be cutting back your spending.
40 Things You Shouldn't Do When You're Broke
You may try to justify certain purchases, rationalizing that you really need that dress or that life will be too uncomfortable without a daily cafe latte. More often than not, though, you’ll be just fine without those extra purchases. Check out this list of things you shouldn’t do when you’re broke.
1. Take Out a Loan for a New Car, or for Any Other Reason
If you’re broke, you can’t afford another monthly payment and that’s exactly what you’re adding to your plate when you take out a loan.
2. Go on an Expensive Vacation
You’re broke, you can’t afford a vacation. If you have money saved up for a vacation, there’s probably something more pressing you could spend that money on—like past due bills or car repairs, for example.
3. Loan Money to Someone Else, or Cosign for Them
Having no money for yourself means you also don’t have money for anyone else. Cosigning is included here because cosigning a loan is essentially accepting the responsibility for the monthly payment if the other signer can’t make it.
4. Spend Money on Non-Necessities
One of the hardest things to do, when you’re broke especially, is to rein in your spending and keep it only to the things you need. It’s important, however, to keep your spending to a minimum until you can afford to spend more.
5. Eat at Restaurants
Buy groceries and prepare your meals at home. Take your lunch to work, even if it means having leftovers.
6. Have Cable Television
Many networks let you watch the shows online for free a day or two after the show airs. That’s a good way to stay up to date with your favorite shows without the extra cost.
7. Go Clubbing With Your Friends
You simply can’t afford to do this if you’re broke—unless you’re not paying a cover and somehow getting free drinks. Find a less expensive form of entertainment and fun.
8. Pay More Than the Minimum on Your Credit Cards
Normally, the advice would be to pay more than the minimum so you can pay off your card balances. However, if you’re struggling financially, you can cut back on payments, temporarily, so make the most of your money.
9. Move to a More Expensive Apartment
Keep your living expenses as low as possible. If your lease at your current residence is nearing its end, talk to your landlord about renewing it at the same rate (or a lower rate if you’ve been a good tenant.)
10. Ignore Your Bills and Bank Statements
Ignorance is not bliss in this case. While you have your head buried in the sand, a storm is brewing all around you and you can’t ignore it forever. Facing the reality of your situation is the only way to make the most of it and try to get out of it.
11. Overdraft Your Checking Account
Letting your account balance become negative will make your financial situation worse. Not only will you face overdraft fees, when you finally deposit money into your checking account it will be eaten by the negative balance. Work hard to keep your balance in the positive.
12. Pay Your Bills Late
Late fees add up and eat into the money you do have. If you become too delinquent, some services may be disconnected and you’ll have to pay the full balance due in addition to a reconnection fee. It’s easier, cheaper, and better for your credit score to just to stay current on the balance.
13. Pretend That You Have More Money Than You Do
If people think you have money, they’ll expect you to spend money. You don’t necessarily have to let people know the severity of your financial situation, but don’t pretend you have money to blow when you don’t (even to yourself).
14. Quit Your Job Without Having Another One Lined Up
At least with another job in the queue, you won’t have a lapse in pay. Quitting without another job is risky.
15. Spend Your Spare Time Doing Something Unproductive
There are so many things you could do during your spare time to make more money—directly or indirectly. For example, you could get a part-time job, learn a money-making hobby, or study to improve your skills so you can demand more money.
16. Lie to Your Spouse About the Money
It’s often said that money is one of the biggest causes of divorce. Keeping secrets about money will probably cause more harm than good.
17. Spend Your Savings or Emergency Fund on Non-Emergencies
If you have savings, make it last as long as possible. Be very conscious about what you’re withdrawing money for. Make sure it’s for necessary expenses and not luxuries.
18. Waste Electricity or Water
These are two utility services whose price you can control. Turn off lights you’re not using. Don’t let the water run. Use surge protectors and turn them off when you’re not using those products. Wash your clothes in cold water. Save as much money as you can on these expenses.
19. Take on New, Recurring Expenses
At this point, your financial situation is too uncertain to take on new responsibilities.
20. Drive Places Unnecessarily
Combine errands and minimize your driving time to save money on gas. You can also take public transportation, walk, carpool, or ride a bike to reduce the amount of money you spend on gas.
21. Go on Expensive Dates
There are plenty of ideas for cheap and free dates—like a movie from the library (yes, they have those!), popcorn, and $10 wine. You don’t have to break the bank every time you go out—and if you do, you should probably reconsider the person you’re dating.
22. Pay for Subscription Services
Subscription services are usually unnecessary extras. Cancel recurring expenses for things like satellite radio, credit monitoring, Netflix, Hulu, and shoe club. Yes, you’ll have to get used to life without your services but you will also save money.
23. Pay to Get Your Car Washed or Your House Cleaned
Don’t pay someone else to do things you can do yourself. Paying someone may save a little time and work, but when you’re financially strapped, you just can’t afford to pay for these things. If you can barter for them, that’s a different story.
24. Rule Out Part-Time Work
Make some extra money if you can. Consider getting a part-time job in the evenings or weekends. If you manage it well, the extra money can help pull you out of your financial hole.
25. Buy Expensive Gifts (or Any Gift)
If holidays, birthdays, or other occasions are coming up, consider your budget before you go shopping. Assess how much you can spend without completely disrupting your bank balance. If you can’t afford to buy anything, put some thought into a gift you can make.
26. Make Frequent Hair, Nail, or Spa Appointments
You can do your own nails and give yourself a facial for a fraction of the cost that you’d pay a professional. You may not necessarily be able to give yourself a haircut, but you can go a little longer between trims, e.g. a month or two instead of bi-weekly.
27. Grab a Coffee From Anywhere but Your Kitchen
Your $4-cup-a-day habit has to go if you’re broke, since that’s more than $100 a month if you buy a cup every day. And if you buy more than one a day, you’re spending a lot of money. You could buy a single cup brewing system for about that much and save tons of money every month thereafter.
28. Buy New Electronic Devices
You barely have time to break in a device before there’s a newer one, more lightweight and with a better screen. Resist the temptation to keep up with the latest gadgets. The changes are usually so minor that you really don’t get a significant benefit by switching to a newer version.
29. Buy Apps, Games, or Extras for the Devices You Already Have
Ahem, Candy Crush addicts. It’s so easy to buy apps; you don’t even realize you’re spending money because it’s either added to your phone bill, charged to your credit card, or deducted from your bank account. Don’t try to minimize what you spend on apps, just don’t spend anything at all.
30. Buy Cigarettes Every Day
The cheapest pack of cigarettes in the United States is a few cents less than $5. The most expensive is $12.85 a pack in New York as of 2020. Smoking a pack a day can cost anywhere from about $150 to $386 per month or $1,800 to $4,620 each year. That’s not a habit a broke person can afford.
31. Lease a More Expensive Vehicle
If you’re nearing the end of your car’s lease and you’re planning to lease another, don’t go with a more expensive vehicle, especially if you were having trouble making the payments of your current lease. Whether you should lease or buy your vehicle is an entirely different argument.
32. Buy an Outfit You’ll Only Wear Once
Certain occasions will call for ensembles that you can only wear one time. Try to avoid these occasions if you’re not in a good place, financially. Renting (or borrowing) an outfit may be cheaper. Worst case scenario, buy it, make sure you keep it in excellent condition, and sell it immediately afterward, on Craigslist, for example.
33. Buy Concessions at the Movies
Movie tickets are expensive enough and I could argue that you shouldn’t go to the movies when you’re broke. But, you definitely shouldn’t buy overpriced drinks, popcorn, or candy at the movies. Yes, the theater makes most of its profits from the sale of concessions, but if you’re in a financial crunch, you can’t afford to contribute to their bottom line.
34. Start an Expensive Hobby, Unless You Can Make Money From It
Investopedia lists five expensive hobbies: ballroom dancing, aviation, skydive, mountain climbing, and scuba diving. On the other hand, if you can profit from your hobby, it may be well worth it. Ideas for profitable hobbies: sell your crafts or teach classes on your draft, offer photography services or sell your stock photos online, or become a caterer or chef.
Gambling is never really a good idea – it can drive financially well-off people to the poor house. But when you’re already broke, gambling is a terrible idea, especially if you think gambling is going to change your situation. It’s too risky, the odds are against you, and the cost of losing is too great – no matter what form of gambling you choose.
36. Pay Your Adult Child’s Bills
Giving money to your children is putting your own financial security at risk, especially if you’re delaying your own bills and savings, or withdrawing from your savings or retirement stash. If they’re adults and capable of working, they should support themselves. There may be rare exceptions, but supporting adult children should never be the rule.
37. Spend Money on Clothes or Accessories That You Don’t Need
Chances are, if you already have any of these items, you don’t need any more of them. Resist the temptation to continue shopping, especially for seasonal and trendy items. If you have a shopping problem, take extra steps to keep yourself from spending – like freezing your credit cards or canceling them.
38. Buy New Books
The library is free and many libraries have e-books available for checking out and reading on your favorite tablet or e-reader. You can even borrow e-books that your friends have purchased.
39. Think Your Financial Situation Is Going to Fix Itself
Your money isn’t going to change itself. You can make the situation better by cutting your expenses and looking for ways to increase your income.
40. Stick to Your Old Spending Habits
Your old spending habits helped contribute to your current financial state. You’ll have to change them if you want to improve your finances. Seriously consider how you’ve been spending and make changes so you don’t have to be broke forever.
Integrate as many of these tips as possible into your daily life and watch as, over time, your financial situation not only gets better, but stays in better shape for the long haul.