10 Financial Habits That Are Holding You Back (And How To Change Them)

Money is a powerful tool. It can create comfort, peace of mind, and freedom. But here’s the brutal truth—if you don’t learn how to manage it wisely, money will keep slipping through your fingers no matter how much you earn. In Nigeria and across the world, many people are trapped in cycles of financial frustration not because they don’t earn enough, but because of certain habits they’ve unknowingly picked up over time.

If you constantly find yourself asking, “Where did all my money go?” or living from paycheck to paycheck, this blog post is your wake-up call.

Let’s dive into 10 financial habits that are holding you back—and how you can change them today.

1. Living Above Your Means

This is perhaps the most damaging financial habit out there. In the age of social media, it’s so easy to fall into the trap of “fake it till you make it.” You want to wear the latest designers, drive a flashy car, or always pop bottles at the club—even if your account balance is crying.

Why it holds you back:

Living above your means keeps you in a perpetual state of debt or financial anxiety. You’re constantly spending more than you earn.

How to change it:

Create a realistic monthly budget.

Differentiate between needs and wants.

Avoid lifestyle inflation—even when your income increases.

2. Not Tracking Your Expenses

If you don’t know where your money is going, how can you control it? A lot of people just spend and hope for the best.

Why it holds you back:

You end up making impulsive purchases and overspending without realizing it.

How to change it:

Use mobile apps like Monify, Spendee, or Excel sheets to monitor your expenses.

Review your spending weekly or monthly.

Identify and cut down on unnecessary expenses.

3. Impulse Buying

That quick “I deserve it” or “Let me just spoil myself small” moment can cost you a fortune in the long run—especially when it becomes a habit.

Why it holds you back:

Impulse buying drains your account, especially on things you don’t actually need or even use later.

How to change it:

Practice the 24-hour rule: Wait a day before buying non-essential items.

Always go shopping with a list and stick to it.

Avoid online window shopping when bored.

4. Ignoring Emergency Savings

A lot of people in Nigeria rely on borrowing when life throws unexpected expenses their way. The problem? Life will always surprise you.

Why it holds you back:

Without an emergency fund, any little crisis can push you into debt or derail your goals.

How to change it:

Start small: Save even ₦1,000 a week consistently.

Open a separate savings account for emergencies.

Aim to build at least 3–6 months’ worth of expenses over time.

5. Depending Solely on One Source of Income

Gone are the days when one salary was enough. Today, relying on a single income stream is risky, especially with inflation and economic uncertainty.

Why it holds you back:

It limits your financial growth and increases your vulnerability if anything happens to your job.

How to change it:

Explore side hustles that match your skills or interests.

Learn about investments, freelancing, or digital products.

Use your evenings or weekends wisely to build additional income streams.

6. Borrowing for Lifestyle, Not Investments

Taking loans to buy gadgets, clothes, or host owambe parties is a recipe for financial disaster. Yet many fall into this trap just to impress others.

Why it holds you back:

You end up paying back debts with interest for things that don’t generate income or value.

How to change it:

Only borrow for productive ventures like business or education.

Live within your means and avoid peer pressure.

Delay gratification—if you can’t afford it now, save up for it.

7. Neglecting Financial Education

Many people don’t even know the basics of money management, and worse, they’re not trying to learn. If you don’t know how money works, it will work against you.

Why it holds you back:

You’ll keep making poor financial decisions and remain stuck in the same cycle.

How to change it:

Read books like “The Richest Man in Babylon” or “Rich Dad Poor Dad.”

Listen to finance podcasts or YouTube channels.

Follow Nigerian financial experts on social media for relatable tips.

8. Saving Without Investing

While saving money is good, letting it sit idle in your account for years is not smart. Inflation will eat it up gradually.

Why it holds you back:

You miss out on opportunities to grow your wealth through compounding and smart investments.

How to change it:

Learn about mutual funds, real estate, agriculture investment platforms, and stocks.

Start with low-risk options like fixed deposits or money market funds.

Always do proper research or consult financial advisors before investing.

9. Failing to Set Financial Goals

Wandering through life without clear financial goals is like traveling without a map—you’ll likely get lost or end up somewhere you didn’t plan for.

Why it holds you back:

You lack direction and motivation, making it easy to waste money or procrastinate on saving.

How to change it:

Set SMART goals: Specific, Measurable, Achievable, Relevant, Time-bound.

Write down short-term (e.g., buying a laptop) and long-term goals (e.g., buying land).

Break big goals into smaller monthly targets.

10. Trying to “Keep Up” With Others

This is one of the silent killers of personal finances, especially in Nigeria where status and appearance are heavily emphasized. People spend to “belong,” even if it means putting themselves in financial bondage.

Why it holds you back:

You spend based on comparison rather than personal priorities, leading to debt and anxiety.

How to change it:

Practice contentment and focus on your journey.

Unfollow or mute people who pressure you with flashy lifestyles online.

Remind yourself: “Na who get problem dey hide am. Focus on your own race.”

Bonus Tip: Not Reviewing and Adjusting Your Financial Habits

Even if you’re doing well financially today, your needs and goals will change with time. What worked for you at 25 may not work at 35.

How to change it:

Periodically review your budget, income sources, and expenses.

Track your net worth every 6 months.

Stay flexible and adjust your strategy based on life changes.

Final Thoughts

Financial freedom doesn’t happen by chance—it happens by choice. The good news? Every one of the habits mentioned above can be changed. You don’t need to be perfect; you just need to be intentional. Start small, be consistent, and give yourself grace along the journey.

Nobody is saying you shouldn't enjoy your money. But there’s a difference between enjoying your money with wisdom and spending recklessly to look rich while staying broke. As Nigerians like to say, “cut your coat according to your size.”

So the next time money enters your account, pause. Think. Plan. Ask yourself: “Is this taking me closer to financial peace—or further into stress?”

You have the power to break free from the cycle. All it takes is one decision at a time.