Certain expenses in life are unavoidable, but there are others we can steer clear of, though we often don’t. These unnecessary purchases can contribute to ongoing financial struggles. For guidance, you’ll find 19 examples in this article of avoidable expenses that often trap people in a cycle of poverty.
Rent
According to Zoopla, the average UK flat rent is a staggering £1,223 a month. This means that unfortunately, many poor people are spending the majority of their paychecks on rental fees. This leaves them little left over at the end of the month to pay their other bills, and the awful thing is, it prevents them for saving up for their own home, keeping them in an infinite cycle of renting.
Fast Food
Fast food might seem like a quick and cheap way to feed yourself and your family, but buying a fast food meal for the entire family could work out just as expensive as making a home-cooked meal. Many poor people are lured by the seemingly low prices of fast food and waste a lot of money on it each month.
Brand-Name Drugs
National Geographic discusses the difference between brand-name and generic drugs, stating that “generics cost about 80 to 85 percent less than their brand name equivalent.” One reason that the poor stay poor is that they spend way too much money on brand-name drugs when they could get the same quality from generic drugs.
Brand-Name Clothes
Buying brand-name clothes does not necessarily mean we’re going to get a better quality garment. But many poor people try to purchase a couple of brand-name items to make their standard of living appear more impressive. But all this does is waste money which could have been spent on good-quality, mid-range clothing.
Coffee
A cup of coffee from a coffee shop in London could set you back five quid, so even just buying one once a week will still total over £250 a year. People with low incomes should stop paying for coffee on the streets and bring their own coffee with them from home.
Parking Tickets
There’s no denying that parking tickets can be very expensive, yet instead of walking or biking to the places they need to go, many people with limited incomes drive there and end up paying for parking. Wasting money on parking is something they can’t afford to do, so why do they continue?
Lottery Tickets
Some lottery tickets in the UK cost up to £10 a pop, yet sadly, a lot of people are addicted to them and spend thousands a year trying to earn their money back. Many people with low incomes buy lottery tickets in the hope of changing their situation, but they end up spending more money, as the chances of winning are slim.
Impulse Buys
According to Fit Small Business, “nearly three out of four make most (of their) purchases impulsively.” Yes, most Brits, poor or not, are spending money on impulse buys—on things they did not plan to purchase. This is a problem for people with low incomes, as they do not have the money to keep buying things they didn’t plan for.
Latest Smartphones
There are always new smartphones appearing in the market and people are constantly being encouraged to upgrade. Having a nice smartphone might give the appearance of a good financial position, so some people with lower incomes are tempted to buy them to make themselves appear well-off.
School Supplies
School supplies are expensive and no child wants to go back to school in the fall with the same supplies they had before the summer. Parents feel forced to buy their children new things so they can feel happy, even if they cannot really afford them.
Taxes
Tax is an expenditure that no one can escape but that really eats into a big chunk of our monthly income. People with lower incomes especially feel the effects of paying taxes, as they are relying on every dollar they earn to help get them through the month.
Transportation
Another reason why many poor people stay poor is because they have to pay daily for expensive transportation to work. It’s unfortunate, because many people use public transport in the hope that they will eventually save up for a car, but when British trains and buses cost as much as they do, this might never be achievable.
Interest
Buying on interest and taking out loans is another reason why the poor stay poor. When you buy on interest, you always end up spending more than you would have done if you had saved and paid for the item outright. This becomes a trap for many.
Petrol
The prices for petrol nowadays are not what they used to be a few years ago. Getting around has become more expensive but there’s nothing we can do about that. The price of petrol is especially hard on those with low incomes, as they have no choice but to pay for it.
Vehicle Repairs
Old cars constantly need repairs. Although getting a newer car would save more money in the long run, many poor people do not have that option. They’re forced to continue spending money repairing their old cars because they do not have the funds to buy something better quality.
Fast Fashion
Fast fashion clothing is not good quality. Because of that, you have to keep replacing clothing over and over again, as it doesn’t last. People who do not have a lot of money are drawn to the low prices of fast fashion. But because these clothes quickly tear, fade, and wear out, they need to replace their wardrobe often.
Streaming Services
Streaming services may seem worth it because you have an array of things to watch and keep you entertained. But how much are you really using it? Are you getting your money’s worth out of the service? Many poor people find themselves canceling streaming services.
Appliance Repairs
Do you have an old dishwasher or washing machine that always seems to have something going wrong with it? Then you might spend more money in the long run patching it up than you would on a new appliance. This is a trap that many poor people fall into.
Major Home Repairs
Does a major repair need to be done in your home? When we can’t afford to do a major repair, we try to do minor repairs to put off forking out for a lot of repair work. But this can actually be counterproductive, and we end up paying more.