I Spent 5 Years Studying Poor People and Here Are 4 Destructive Money Habits They Had

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Your money habits can make you rich or put you in the poor house. According to a recent study by Brown University, in which nearly 50,000 families were surveyed, most of the habits we pick up in life come from our parents (Brown Study). This includes money habits. If your parents had bad money habits it is likely those habits rubbed off on you. But in order to change bad money habits you need to first become aware of them. Below are some destructive money habits that I uncovered in my five year Rich Habits study that will put you in the poor house unless you eliminate them:

  • Gambling Habits – Gambling is not a sound plan to lift you out of poverty. Gambling relies on random luck. The odds of winning Powerball are 1 in 175 million. That’s basically zero. Seventy-seven percent of the poor admitted to playing the lottery regularly vs. 6% of the rich. But it’s not just the lottery they gamble their money on….. 52% of the poor admit that they gamble on sports at least once a week vs. 16% of the wealthy.
  • Time Wasting Habits – Time is money. The rich understand this. Sixty-five percent of the rich created at least three streams of income during their lives. Conversely, the poor all relied on one stream of income. They didn’t invest their time wisely in building their careers or building a side business. In my study, I uncovered many time wasters the poor engaged in that ultimately cost them money: Seventy-seven percent of the poor admitted to watching more than one hour of TV each day and their preference? Reality TV wins hands down. Seventy-eight percent of the poor watch reality TV shows. The rich, on the other hand, are not big on TV. Sixty-seven percent watch less than an hour each day and it’s not reality TV that they tune in to. Only 6% watch reality TV. Another time waster is the Internet. Seventy-four percent of the poor in my study spent more than an hour each day on the Internet. These days that means Facebook, Twitter, Instagram, Snapchat or YouTube. Conversely, 63% of the rich spent less than an hour each day on the Internet. This freed up more time to read for self-education. While many of the poor in my study said they read regularly, 79% admitted that they read strictly for entertainment. Only 11% of the rich said they read for entertainment. Instead, they focused their reading on self-education: biographies of successful individuals, career-related reading, self-help, history and money matters. When you’re wasting your time watching TV, on social media or reading for entertainment it leaves little time to do productive things like reading to learn, building relationships with other success-minded individuals via networking or volunteering or building a side business. Time does not discriminate. Everyone gets twenty four hours, rich or poor. The rich simply choose to spend their time differently, doing things that are productive.
  • Bad Spending Habits – The rich in my study made a habit of tracking their spending in the early days of building their wealth. It’s easy to lose sight of where your money is going. If you don’t have a lot of money you need to get into the habit of tracking every penny. The poor in my study didn’t. I uncovered certain poor spending habits that held the poor back in life: Ninety-three percent admitted that they did not budget their spending. Sixty-six percent admitted that they were not frugal with their money. They had a bad habit of making spontaneous purchases with their money. Oftentimes, this required them to use credit cards. Eighty-eight percent of the poor in my study had over $5,000 in revolving credit card debt. Sixty-nine percent used those credit cards to purchase big ticket items. And 77% had multiple credit cards. Conversely, 92% of the rich relied on one and only one credit card. Eighty-eight percent of the poor never shopped at a goodwill store in their lives. Many goodwill stores sell high quality clothing. The clothes may require some minor tailoring but, otherwise, you’re getting real value at a steep discount. Sixty-eight percent of the poor said they don’t use coupons. Why would you pay more for food than you have to? Every dollar you save is one less dollar you have to earn. Sixty-one percent of the poor did not own their homes, they rented them, while 100% of the rich owned their home. When you don’t own you home, you are unable to build home equity, which comes in handy when you retire or to help your kids with college costs.
  • Poor Savings Habits – Only 5% of the poor in my study saved 10% of their income. None saved 20% of their income. Conversely, 94% of the rich in my study saved 20% or more of their income. Many of the millionaires in my study started out poor and did not have large incomes during their lives, so this was a habit they adopted while they were still poor. Fifty-one percent were small business owners who watched what they spent in order to enable them to save money. They then invested their savings, as well as the investment income generated by their savings. After many years, their savings and investments compounded, eventually turning them into self-made millionaires. It wasn’t easy but they did it. You can too! You just need a plan. You need to bite the bullet and save 10% or more of your income and then invest your savings wisely.

Building wealth takes time. It doesn’t happen overnight. It took the average millionaire in my study thirty-two years to become rich. The younger you are the more time you have to build wealth. That’s only possible if you eliminate destructive money habits and adopt sound money habits.


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Thomas C. Corley About Thomas C. Corley

Tom Corley is a bestselling author, speaker, and media contributor for Business Insider, CNBC and a few other national media outlets.

His Rich Habits research has been read, viewed or heard by over 50 million people in 25 countries around the world.

Besides being an author, Tom is also a CPA, CFP, holds a master’s degree in taxation and is President of Cerefice and Company, a CPA firm in New Jersey.
Phone Number: 732-382-3800 Ext. 103.
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  1. I vehemently disagree with your assessment. First of all, i do NOT gamble, nor do I waste time. I have worked at least three jobs for most of my life. I have a terminal degree, as well as various other professional licenses. And I’m still poor. Not because I don’t work hard, no. Because I can’t get a break. I even moved to a miserable snowy city from heaven (Sedona, AZ, is as close to heaven as you’ll get on earth) to try to find a better job suited to my education and experience. Didn’t happen. All that happened was my cost of living went up. As far as my spending habits, well, if you thihk splurging on an Arby’s meal instead of the Mickey D’s value menu or a TV dinner from Dollar Tree is a bad spending habit, well sue me (hint: If you do, you won’t get anything). When your life is an neverending misery of working at various underpaying jobs until you finally get to sleep for five or six hours only to wake up and do it all again, a semi-decent meal (if you can call Arby’s a semi-decent meal) is a welcome change now and then. And as for savings, puh-fucking-lease! You can’t save if every single dime you make goes to your costs of daily living, like rent, utility bills, or food. There’s nothing left to save. Your article is bullshit, it does nothing but demonize the poor for being low-lifes, instead of addressing the real problem: Unions have died in America. The economic recovery has gone 99.9% to the 1%, and they aren’t sharing. Trickle-down economics has destroyed the middle class. Stick your article up your ass and do some research.

    • Thank God the 31% of the poor in my study were not mentored by you. They’d still be poor. As for all of the economic recovery going to those who are rich, how do you explain that according to Wealth X most of the world’s wealth comes from those in poverty or those in the middle-class? You are the victim of your own limited thinking.

      • No Thomas! I have to agree with Jennifer’s remarks. Here we have a system that capitalisiom is good for the top earners and very little for the low paid. You said it yourself when you mentioned that most of the worlds wealth comes from those in poverty low paid jobs. An easy way to describe this is a field worker or farm labourer works his/her socks off all day for very low pay. His or her toil supplies the wallmarts supermarkets of the world.Its the supemarkets and CEO’s and the directors who get the top salaries. Wealth created by the poor to the rich.

        • Quit shopping at Walmart which has brought very low prices for food to millions. I appreciate what they have done, put needed commodities in the hands of the working poor.

      • bongstar420 says:

        They still are poor.

        You get rich by others below you turning a profit for you with their work…At the bottom of the pyramid, there is not anyone to hire.

      • Walleye says:

        Ahem brother, I find the biggest complainers are the people who have failed and then blame everyone else. I grew up on welfare and learned an important life lesson to always live below your means. 2 years go retirement and all looks good.if I keep working, it’ll be for fun

    • Attitude determines your latitude. Maybe if you change your mindset, your circumstances may get better. I think the author is on point; if one disagrees, that’s cool, but he certainly didn’t deserve such harsh criticism coupled with foul language. You sound so bitter and that kind of explains why you are in that situation. I don’t know your full history; maybe some unfortunate incident or bad decision stunted your growth; I don’t know. However, I know people that went to prison and got released; they later greatly improved their circumstances. They were severely disadvantaged by a criminal record, but they took accountability, pushed forward and they are doing great. If you’re working 3 jobs and still can’t make the ends meet and save, something is wrong and you need to re-evaluate. Best wishes and I hope God blesses you if you will allow him to.

    • I fully agree with this article. I was (and probably am still) not classified as rich. BUT, when I was a kid, 12 years old, I was left on my own in this big world to take care of myself. I had no knowledge of budgets or what it takes to survive, so I knew I had to educate myself financially. I do not have super human abilities or great talent that landed me money, instead I worked the same low paying jobs as everyone did (in fact, I only found out later I was being paid so little it was actually illegal). I used every minute I had to study and work, putting myself through school. I set up a budget and kept to it very strictly, if it was not on my list I am not spending money on it (exception being in emergencies of course). At the end of the month, if I managed to get through the month with a cent to spare I would put it away as savings and carry on with the next salary. Fast foods was non-existent and I carefully planned meals with foods such as potatoes and veggies being the staple foods. I am now 24 years old, put myself through school and slowly but surely working my way to a degree. I have a nice little house that I rent full of furniture I worked hard for and a car that is old, but still gets me from point A to point B. I might not have “luxuries” like a TV or nice clothes (I still make my own to save money), but my fiance and I are happy with the progress and we are still working hard just like we did then.

      My point with this comment is that you could say “I don’t gamble, I don’t waste yet I have not been able to build up some savings or get any further…” , but maybe your perspective of poor is a little bit different. If you say you can actually afford TV dinner even if it is the budget one, I say that is still a luxury if you are poor. What you see as “needs” is a luxury to other. You cannot get ahead financially if you are always living on the limits of your salary. You say you are living on rock bottom, I am from Africa, I think you should see this perspective of rock bottom before claiming that you cannot lower your lifestyle to benefit from it in the long run.

      I knew a man who complained of a low salary (I am from a different country so I cannot give you that in dollar or euro to explain). This man was my father… He complained when he had R6000 as a salary that he was not earning enough to be able to get by financially. His employer was a nice man and raised is salary to 10 000, then to 15 000… It was never enough and he was still living from month to month. His excuse was that he felt he deserved to life a little bit better lifestyle now that he can afford it, but he was missing the point. I feel you can only up your lifestyle when you can live off your salary, put away into savings and still plan carefully within your salary.

    • bongstar420 says:

      You see, thats your mistake.

      He said the rich have multiple sources of income, not that they have multiple jobs. You see, you take your money, and hire someone else to make money for you. That is the way to get rich.

      BTW, rich is more than a million USD

    • Seems like you like to feel sorry for yourself and that definitely will not help your situation; not being mean just an observation from an outsider.
      If you’re not happy with your current situation continue to look because life is short and there is no do over.
      Good luck

    • I think another habit of the poor is blaming everyone but themselves. Try reading a poem by Mayme White-Miller called, ‘Yourself To Blame.’ All I read in your post is excuse after excuse. If you have never spent a penny on a lottery ticket or a Bingo game – congratulations. This article never stated ALL poor people but as a whole these are identifiable markers. Apparently, reading comprehension is also a problem.

    • Matthew says:

      First step to saving money- Make your own food don’t eat fast food. I make lunch for a week (5 days) costs me $11. Thats only 2 Big Mac meals at McDonalds.

  2. “Conversely, 63% of the rich spent less than an hour each day on the Internet. This freed up more time to read for self-education” I truly hope that this is logic leaping statement is referring to time spent on the internet for leisure and fun as opposed to just the blanket statement as it is written! Since that wasn’t properly delineated and knowing full well that today’s “rich” (whatever that means) and “poor” alike both use the internet FAR more than an hr a day and generally have a MUCH more fulfilling time utilizing the internet for “self-education” than any book; makes me wonder exactly which five year period you spent “studying” these “habits”? Was it 1995-2000? or even earlier? It sounds very dated! http://www.theatlantic.com/technology/archive/2016/02/internet-planet/470316/

    • Leisure time. 2004-2008. The self-made rich don’t waste their time surfing the Internet unless it’s related to their goals, dreams or their job or business. You can disagree, but I have data on my side, not opinions.

  3. Set goals that can be certain and obtainable, after that break these on to manageable pieces part during a period. In the act, growing each landmark builds trust and results in push. Self-confidence, in turn, evolves like with a good coral deep sea on part compresses to a great platform.

  4. Maybe rich people better understand the “right” response, and accordingly under-report the time they spend watching TV, surfing the Internet, etc. Maybe many rich people who play the lottery know it’s a dumb thing so they say they don’t play

  5. you retard. if you are poor, you can’t save 10% of your income because you need it. If you have plenty money you can afford to save 20%! that is a no brainer.

    • You can always save. But you have to make tough choices like no cell phone, no cable, no big TV, smaller home or apartment, no McDonalds, Doritos or beer, wine or alcohol. No lottery tickets. 31% of the rich n my study came from poverty. Thank God they didn’t have someone like you as their parent or mentoring them. They’d still be poor.

      • Amen!

      • I agree. People are so quick to be in a defensive mood. Most of my friends are not saver. They all waste so much time on entertainment, facebook and going out to eat. Only thing they read is pop culture novels and biography of some show business stars etc (not that it’s wrong, once in a while I do that too). They don’t care enough of issues on economy or policies that affect. They don’t study investing and how to increase one’s net worth.
        We are the creature of our habits and wealth building is “mostly” to do with financial discipline, not how smart one is. I have a friend from work and she’s very capable. But she pisses off all her earnings and don’t know how to be happy without spending all her paychecks. She hangs out with the same type of people – impulsive, poor because of his/her spending habit, shallow and pleasure driven. She insists on living in a one bed room apartment which costs about $1,000-$1500 per month where we live, and her salary is meager $33,000 a year. I told her she can get a nice studio and make it very nice space. She lives in a run-down two+ bedroom apartment. She has so much potential but she isn’t willing to use any of her resource. She won’t try to get a better paying job saying society discriminate against women etc. Most perpetually broke people I’ve seen in my life are just like her. Stubborn and not resourceful, but definitely not stupid.

      • bongstar420 says:

        For sure. You are going to get rich saving $15k a year.

        In no way does getting rich require someone else to do work and give part of the value of that work to you.

  6. Joshua Geissler says:

    Really enjoyed the article

  7. Domis the Entrepreneur says:

    This Man is offering FREE Good advice, and people are calling him a retard!.Priceless

  8. How about trying to compose an article without just catering to the “American” way of life?? Most of what you said is irrelevant in the rest of the world.

  9. “Generally” speaking, I agree with this article. How quickly people get defensive is beyond my comprehension. I noticed a lot of otherwise smart people are not resourceful – they blatantly dismiss the idea not going out to eat and find entertainment at home instead of spending money as” boring”. One of my coworker is more capable than me in her role when comes to our jobs. But I know she is poor and she’s always going to be that way until she opens up her eyes and changes her ways. She’s naturally smart, yet so very unwise. She spends so much money and thinks she cannot have fun without spending money. She waste so much time with facebook and watch entertainment tv channel, exactly this article described. I know so many people fit in this category, it’s not even funny. She’s very stubborn and insists on getting a large apartment she cannot afford. She surrounds herself with the same, unstable people. That is why she is poor. I’m not as talented as she is career wise, but I know how to make well-thought decisions and routinely educate myself in personal finance. We are the creature of our habits. Wealth building is for the most part, everything to do with discipline. No, I’m not talking of being a billionaire. I am taking about accumulating one’s net worth.

  10. Sara Kelley Brown says:

    i realize that everyone has an opinion about this articles base on your own person experiences. i can agree with some of what Thomas wrote and other part i disagree with , however working hard is an america worth. Saving money is a choice. But when you are poor you do spend more money, example, the salary i make does not allow me to live in a neighborhood where the grocery store sales healthier food. my rent take up most of my pay leaving me to cut out things that i need, i have to either pay for a bus pass or walk. i have a cheap cell phone and a cheap cell phone plan. i cook food so that i am not eating out, i rent books from the library, i dont have cable, ,however i do have the internet so that i can continue to move forward in life. i filed a bankruptcy in 2012 so i have no credit debit and no car payments. i dont have a facebook account or any of the other social media accounts. i shop at goodwill and other thrift stores, my favor model is if its not broken why fix it or replace it. i went to collage and have a master degree and because of what other did with their money i lose my job that paid me ok. i have been searching for a job in my field of study for 4 years which by the way is education. and yes i know what you are thinking so why is it so hard to get a job in the school lol i said the same thing. i am a older person, and have been out of work 31/2 year before i got a retailing job. i put in my application in with business to never hear from them not even a sorry we are not hiring at this time. i feel i have a good idea how to use a computer smart phone run an office answer phones. so when you talk about a poor person it would be nice to understand opportunities are not available to everyone. i have called on phones, email people and have gone so far as to walk into the office to see how i can get a job. i dont know about the 1% or the 99% but i do know that opportunities are not available like they use to be even when you have all the right elements in place. i dont have a criminal background, i dont drink or smoke, i have very good work ethics, i do save money and i do spend money but i discovered it really doesn’t matter. America is not the same country anymore and opportunities are only for certain people. A foreigner can come to America and do better than a born America with a degree. So being poor can be a state of mind to but however it always easy for someone like you to make it seem like its a choice and once a poor person change their ways than they too can be rich. That is why you have shows like America Greed in it 14 season . yeah i would not have you come and speak to poor people about up lift themselves they would be depress after your done. thank for caring like the rest of the world.

  11. bongstar420 says:

    Is that how donald trump inherited something like $300,000,000

    • From everything I’ve read and watched on docuseries about him, he DID NOT inherit that amount of money. His father generously gifted him $1million to get a start…but guess what? Trump’s father and grandfather weren’t gifted anything and they did well…stop acting as if Trump is your Daddy and do the work yourself. Stop being so jealous. Trump has had his hard times. His mother and brother were raving alcoholics…imagine growing up like that or having a beloved older brother die of alcoholism so very young…would you trade him your mother and brother for that initial $1 million?

  12. This article sounds like a good base to go by….such as don’t excessively do this or that. But i just don’t Agree with everything on here. Also a study on internet use between 2004 and 2008 would be obsolete because as a person who is 29, I have seen the rise of social dating apps, online booking for food, and pretty much everything else.

    I also have clients who own their homes and are successful and play lotto, spend money on escorts, and watch tv soon as they get off work. I’ve also know wealthy people, lawyers and business men who spend big money on alcohol and drugs. I’ve learned there really isn’t any big habit difference between rich and poor. You either got it, or you don’t. You can learn to be rich but that doesn’t make them into puritans.

    The only differences is the guy who could get his way into a corporate business, or had the sense and tools to create his own.

    And judging whether someone is shopping at goodwill equates to being rich or poor? Well…that’s more of a skill of knowing how to find bargains and have style. I personally don’t care to wear clothes another man has sweat and God knows who else in. You can go to the mall and find new stuff that won’t break the bank. I do it 3-4 times a year. It’s called sales and clearance.

    Unfortunately i feel this article is more about frugal living than becoming financially secure. If it works for someone great, but don’t blanket those who prefer having a bit of luxury, freedom and entertainment.

  13. Jim McClung says:

    One thing not mentioned that I notice, many poor tend to cuss everything F this F that.
    They curse their jobs, food, kids and opportunities. At work it’s just not acceptable and
    will keep them in the back room of the job with no future.
    That also keeps them from learning proper english and usally follows a lack of basic writing skills too.
    If someone has a digilence to get some education and work three jobs,
    I can only see their poor speaking, writing or character holding them back.

  14. I think poor people are OFTEN idiots.

    When you tell them common sense fixes on their bad habits, they tend to attack you.

    I grew up poor and puled myself out of those stupid habits very early on, but most poor people are simply TOO STUPID to see that they are constantly screwing up.

  15. Sarah Goff says:

    Love this article, going to buy your book, thanks!

  16. Lindsay says:

    Anyone who has the ability to make money has the ability to save it, interesting read..

  17. Great article. It’s rare you see someone who is brave enough to point out the elephant in the room: that people are accountable for their actions, and those actions can have negative consequences. As you can see by the comments here, a lot of people are brainwashed into thinking that their problems are the result of everyone around them, and are unwilling to put the blame where it rightfully belongs: on their own shoulders.

    The biggest problem with laying blame on everyone but yourself is that you never develop as a person. You are never able to grow because nothing you do is your fault, its everyone else’s fault.

  18. JayCkat says:

    Only applicable if you are not absolutely poor. Below a certain level of poverty it is impossible to save, you can only go so low. However a path upwards can still be reached if you think in generation time and make sacrifices.. You might die in exhausted and in poverty, but if you do things right, your kid may die in the working class. And your grandkid may die in the middle class.Poverty is difficult to get out. It takes dedication, skills and a bit of luck. Some families can do it in one generation by one remarkable person. But if you don’t have the skill or luck. Your family can still get out via dedication. It will just take a few generations.

  19. Totally agree man ! I am a middle class guy & I am not able to be rich due to my laziness. I have habit of playing too much games & watching anime shows. I am trying my best to reduce time wastage but, I am kind of addicted to those things… Have a good day pal. It was good read. 🙂

  20. Thebrokenman says:

    I’m dirt poor and I save more than 20% of my income, so I think your analysis is wrong.

  21. I just wanted to say thank you for your advice. I am a millennial going to college the long way. What I mean by that is that I’m working while studying so I don’t have to take out loans. I am debt free so far! Also, I think it’s really cool for you to say “thank God.” God is awesome and it’s time people stop being afraid of offending others.

  22. I’m currently in a poor predicament and after reading this I’ve come to realize that the author is right!! Most of what he listed as poor people habits is actually accurate. I believe my biggest regret and number one thing to overcome is I have never kept track of either my earnings and spending. I always assumed that my next paychecks will cover the cost of what I will spend. I have bought countless perishable items that after buying I think to myself what am I ever gonna do w/ it. And it’s true, social media is a time consumer. So here’s my question, I’m now 32 with no degree and with no savings account and limited funds in my checkings account. Do I still have a chance of becoming wealthy!?. Should I continue working or should I apply for college!? Worse, I don’t know what to take in college. I believe me not knowing is also keeping me poor!!!

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