1. Splurge when money comes in

It’s easy to get into the “I’ve been broke for months, so I should be able to treat myself” mindset, and when a large sum of money — like a tax return or bonus from work — comes in, sometimes people run out and spend this money instead of using it for something practical.

According to data published on Mint.com, “Taxpayers reporting more than $50,000 in income were more likely, at 52 percent, to put refunds into savings than those who made less.” Whether this money goes to a vacation, shopping spree, or a new piece of technology, spending a lump sum of money on wants instead of saving it, or using it to pay down debt, is not the wisest choice.

2. Prioritize convenience

When you’re broke, small things make a difference. Each trip to the convenience store to buy milk or bread, for instance, adds up. Second to gasoline, the most commonly purchased items at convenience stores are candy and gum (31%) and soda (29%). Although you may only be spending $2 or $3 more each trip, after 20 or so trips, you’ve spent around $50 that you could have saved simply by going to the grocery store.

The same principle applies with cleaning products, fast food, and other conveniences. It’s much easier to buy disposable cleaning products than to use more inexpensive options like reusable mops, sponges, and toilet brushes. But, many people — even when they’re broke — are willing to pay extra money for the convenience.

3. Take on too much debt (or take on bad debt)

If you have a low income, it is more difficult to pay off debts like student loans, credit cards, etc. Talk Poverty found that earners in the lowest quintile face education debt that averages around one-fourth (24%) of their income. However, the average for all household is only 6%. Some debts like medical debts, of course, may be unavoidable, and some — think student loans, mortgage debts, and responsible credit card debt — may even be practical. But taking on more debt than you can handle is asking for trouble.

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Many people who are broke still take on high-interest loans (e.g., payday-type loans) and large amounts of credit card debt. Bankrate found that as of last year, nearly one out of four people (23%) earning less than $30,000 had more credit card debt than savings.

4. Live above their means

Do you spend more money than you earn? If so, you’re certainly not the only one. A large portion of households, particularly lower-income households, have higher expenditures than they do income.

According to the Bureau of Labor Statistics’ consumer expenditure surveys, consumer units (which are kind of like households) categorized as earning between $30,000 and $39,999 earned an average pre-tax income of $34,655, but they spent $36,093.

In each of the lower-earning income groups, average spending was higher than average income. It wasn’t until the $40,000-to-$49,999 income level (and higher-income levels) that average income finally exceeded average spending.

5. Have no savings

Whether we’re completely broke or not, most of us could benefit from saving more money. It’s a lot more difficult to save when you’re broke, and you need every penny you earn to cover the basic essentials. But it’s still a good idea to save some money. Even if you can’t save up the ideal six months of emergency savings and place large chunks of your paycheck into retirement funds and savings accounts, that doesn’t mean you necessarily have to give up on savings altogether. Even the smallest amounts can make a difference for a rainy day.

Read More: cheatsheet

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