Financial expert Graham Stephan: These 9 financial habits keep you in poverty.

Creating wealth can be a challenging task, especially if you don't know what mistakes are preventing you from achieving financial success. Mastering the right money habits is an effective way to identify the aspects that keep your financial situation unstable. To clarify the situation, let's look at the advice of successful billionaire Judy Faulkner, who turned $70,000 into $7 billion through a series of strategies, as well as learn about some wise financial habits from Graham Stephan, a representative of the real estate world and YouTube.

Stephan, who became a multimillionaire, shares important principles of financial management. Below are nine money habits that can keep you in poverty.

One of the main mistakes, in his opinion, islifestyle inflationThis concept suggests that as your income increases, you start spending more, thereby improving your standard of living. When you receive a raise or additional income, there is a temptation to increase your expenses, which leads to a corresponding decrease in savings. While this doesn't necessarily lead to disaster, excessive spending can create difficulties in accumulating wealth. Once you get used to higher expenses, a sudden budget cut will become a real challenge.

The next common mistake isignoring expense trackingIt is important to understand that conscious control over your money allows you to identify unnecessary expenses. On average, an American spends about $18,000 a year on non-essential purchases, with more than $300 a month going towards impulse buys. Keeping regular track of your spending will help you notice negative trends and correct them at an earlier stage.

Another trap isborrowing the maximum amountWhen it comes to loans and credits, lenders often offer the maximum amount you can borrow, and that isn't always the right decision. What you are capable of borrowing doesn't always match what you can actually afford. Set a budget that is reasonable, regardless of the amount offered by the bank. This will help you avoid falling into a debt trap.

Unfortunately, many do not understand.tax systemAlthough taxes are an inevitable part of life, successful people know how to reduce their tax burdens. For example, the average tax for a single worker in the U.S.

But investments don't end with taxes.Refusal to create pension savings— this is yet another habit that prevents people from building a strong financial future. The wealthiest citizens utilize retirement accounts such as Roth IRAs and traditional 401(k)s. For example, through a Roth IRA, it is possible to accumulate funds tax-free, which can only be withdrawn after the age of 59.5. People who actively use these tools can save up to $32,850 a year.

One cannot ignore the necessity.to have multiple sources of incomeResearch shows that 65% of millionaires have at least three different sources of income. To avoid financial difficulties, it's worth considering new options for additional income, such as starting your own YouTube channel or taking on a part-time job.

Another important point that Stephan mentions is the difference betweeneconomy and greedBy trying to save on something important, you risk spending more in the future due to poor quality services or products. People who strive for excessive savings may unknowingly end up spending more when a replacement is needed, as the cheaper alternative often turns out to be less durable.

Moreover, it is importantto plan in advance for unforeseen circumstancesIt is essential to have a backup plan to deal with unexpected financial difficulties. Stephan advises saving funds for an emergency fund that can cover expenses for 3-6 months, and not to forget about regular car maintenance checks.

Finally,creating a financial plan and understanding your goalsThey are of key importance. A clear strategy is like a route for a car trip. People who act without a plan risk getting lost and not reaching their destination. Ask yourself: what steps do you need to take, how much do you need to save, and what are your priorities? Most people don't need millions to live happily. It's enough to clearly define your financial goals and move towards them step by step.

Remember, it is possible to overcome poverty if you put these financial habits into practice.