Wallet Wellness: Money Habits Keeping You Poor

From settling for stagnant jobs, depending on a single income, prioritising consumption over assets and procrastination, the money habits you need to break to build wealth.

Greetings, and welcome to the eighth edition of Wallet Wellness in 2024 - your midweek source of practical financial tips to elevate your money management skills!

We hope you had a chance to check out the last edition where we discussed Seven Ways to Avoid Retiring With No Money.

As always, be sure to check out the Concept Corner below for a deep dive into the money concept of the week.

Let’s dive in!


6 Habits Preventing You From Building Wealth

Everyone wants to be rich and wealthy, but each person has their own idea of what "wealth" means. 

For instance, if you were to pick 10 random people off the streets and ask them if they would like to be wealthy, it is highly probable that 10/10 would say a resounding yes!

But if you were to dig deeper you would find that being wealthy means different things to different people. Read More.

Some say a million dollars is enough, while many others will feel content with much less. Others define wealth as having a big house, a yacht, and a private jet - or simply a comfortable home and good insurance coverage.

Ultimately, it comes down to recognizing what truly makes you feel satisfied with your life. Read More.

Now, would you like to be wealthy? If yes? What is stopping you?

Today we will delve into some of the habits that hold people back from attaining their idea of being wealthy. 

1. Living Above Your Means

By spending more money than you earn, you risk falling into debt and financial strain, ultimately hindering your ability to accumulate wealth. Remember, the key to building a secure financial future is to live within your means and avoid unnecessary expenses. Read More.

  • Adjust Your Lifestyle: Assess your lifestyle and find ways to cut back without sacrificing quality of life. For example, eat out less, reduce entertainment expenses, or downsize living arrangements. Read More.

  • Create a Realistic Budget: Make a budget that matches your income and goals. Track expenses to stay within budget. Be honest and adjust spending to live within your means. Read More.

  • Increase Your Income: Take on a part-time job, freelancing, start a side business or upskill to command higher salaries in your line of work. Read More.

2. You Depend Solely on Your Salary

Consider whether your current salary will be sufficient to maintain your standard of living in five years, given typical annual appraisals of 10 to 15% and rising inflation. As you move up the corporate ladder, your salary may plateau unless you adjust your financial strategy.  Read More.

  • Create Multiple Streams of Income: Diversify your income sources by exploring opportunities to generate income outside of your primary job. Read more

  • Build a Solid Savings and Investment Plan: Create a savings and investment plan with a financial advisor to be channeling a portion of your income regularly. Read More.

  • Focus on Personal and Professional Development: Invest in self-improvement by gaining new skills, pursuing higher education, and networking. Continuously improve your knowledge to increase your earning potential and explore new career opportunities. Read More.

3. You Accept a Job Even When there's no Potential for Professional Growth

Pursue your passion. Without passion, personal growth stagnates, leading to a mundane and unfulfilled life. Taking on a job solely for money can drain your vitality. Find work you love, and you'll have the best chance of achieving wealth as a result of your success. Read More.

  • Define Your Career Goals: Clearly define your career goals to align with job opportunities and avoid limited growth roles if you can. Regularly update goals for ongoing relevance in your professional development. Read More.

  • Align with Your Passion: Pursue roles that align with your interests and passion. When you're passionate about your work, you're more likely to stay motivated, continue growing, and avoid feeling stuck in a dead-end job. Read More.

  • Be Realistic: Do not throw logic out the window in your quest to land roles that align with your passion. Evaluate opportunities based on a set of personal values and the skills you can learn to get you closer to your most ideal position. Read More. 

4. You Prioritise Purchasing Liabilities Over Assets

Do you believe that buying a car in instalments or filling your wardrobe with the latest and most expensive designer clothes will somehow prop you up financially? Prioritising simple luxuries and comforts can rob you the capital you need to build wealth. Read More. 

  • Develop an investment strategy: Buy and invest in things whose value increases with time. Such as stocks, property, or bonds or investing in mutual funds or a new business. Read More.

  • Master the art of delayed gratification: Sacrificing your short-term pleasure or satisfaction in the present moment for the sake of achieving a more valuable long-term goal. Read More. 

5. Not Saving or Investing

The money you have today will be worth a lot less a few years from today, and even much less in retirement. Wealth is a function of your ability to multiply the money you have today to be worth more in the future. And this is through investing. But you cannot invest if you are not saving. Read More.

  • Automate Your Savings: Set up automatic transfers from your current account to a savings or investment account. Read More.

  • Create a Budget and Track Your Spending: Develop a budget that includes your income, expenses, and savings goals. Read More.

  • Educate Yourself About Investing: Take the time to learn about different investment options and strategies. Consider seeking advice from a financial advisor. Don’t leave your savings sitting idle. Read More.

6. You Procrastinate

Procrastination is an enemy of success. It is a thief that robs us of time, opportunity, and our potential for greatness by allowing fear, doubt, and insecurity to take control. Read More

Delaying important financial decisions, such as saving for retirement or paying off debt, can result in missed opportunities and financial setbacks.

  • Use Reminders and Deadlines: Set reminders for important financial tasks, such as reviewing your budget, checking your credit report, or evaluating your investments. Read More.

  • Accountability Partner: Share your financial goals with a trusted friend, family member, or financial advisor who can help hold you accountable. Read More.

To achieve your idea of being wealthy, avoid habits like overspending, relying only on your salary, settling for stagnant jobs, prioritising liabilities over assets, and neglecting savings or investments. 

Instead, live within your means, diversify income sources, pursue your passions, invest wisely, avoid procrastination, and most of all practice self-discipline. These habits can lead to a more secure financial future and help you achieve your wealth goals.


Living Above Your Means

You must have already heard of the dangers of living beyond one’s means. What you may not really know is you could actually be one of those unenviable people living beyond their means. It is one of the surest ways to not just retire poor but to also live a low quality life, to never own what you desire and generally a ticket to never achieving your financial goals. Read More.

Money and Me

“Relative Misled Me to Work for Free!”

My first job was a generous touch from the gods of nepotism. Fresh from campus, I was hunting for any gig that would spare me the agony of returning to the village. I needed little persuasion to join my seemingly well-off cousin who had lived at the Coast for years. A few days to graduation, my cousin Mustafa gave me a job offer...” Read On.


A Software Engineer’s Salary in Kenya

Wondering how much a Software Engineer earns in Kenya? In today’s MoneyTok, we sat down with an self-taught software engineer with 10+ years of experience to learn all about this career path and what to expect in compensation. Watch Video.


How much does a software engineer earn in Kenya earn? What it takes to become a software engineer. #careertiktok #moneytok #money254 #pers... See more

That's it for the eighth Wallet Wellness edition of 2024! We hope these financial tips have added some energy to your mid-week hustle. Stay tuned for more practical insights in our next edition of "Wallet Wellness" next week and watch out for Money Weekly on your inbox this Friday.

Also, don’t forget to download the Money254 App on the Google Play Store, and remember that we can help you compare over 300 loans, savings accounts, current accounts, and more if you’re thinking about your next product.

Cheers to your wallet's well-being!

Money254 editorial team.


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