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Boost Your Financial Success: 6 Essential Purchases to Avoid Until You Reach $100,000 Annual Income

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Bad Financial Habits to Avoid for Modest Earners

Bad Financial Habits to Avoid for Modest Earners


Many people view a six-figure income as financial validation. When you break the $100,000 mark, you’ve officially made it. But many high earners have bad financial habits that keep them living check to check no matter how many raises they get. Conversely, people with modest incomes can live rich if they understand that healthy spending — not an arbitrary dollar amount on a paycheck — is the true path to wealth. While $100,000 is as arbitrary an income as any, it’s a good benchmark for those who aspire to financial security. When you get there, you might be able to afford to loosen your belt a little — until then, avoid these purchases at all costs while you’re still earning five figures.

Luxury Cars

  • A fancy car that turns heads on the highway is something most people want, no one needs and few can afford.
  • If you’re not a six-figure earner, learn to love daydreaming while spending as little as possible to keep your hooptie running as long as you can.
  • Certain automobile models are so pricey that they can put a serious strain on your finances every single month.
  • Vehicles that are more expensive to buy are also more expensive to own.

New Cars

  • You shouldn’t buy a new car until you make at least $100,000 a year.
  • New cars depreciate quickly.
  • When you buy a used car, you’re letting the previous owner absorb the impact of depreciation.
  • A gently used 1-year-old vehicle that’s nearly as good as new can come with a 20% discount.

Personal Status Symbols

  • Luxury cars aren’t the only status symbols that allow people to project wealth they don’t have.
  • Designer purses, clothes, jewelry, and shoes start losing value at the moment of purchase just like Audis and BMWs.
  • Postponing extravagant spending on depreciating assets can have a significant impact on your long-term financial success.
  • Prioritize investments that generate passive income or appreciate over time.

Professional Services for Household Tasks

  • There is no reason to hire out recurring lawn, snow removal or cleaning services for one’s residence if there is little disposable income.
  • Most service businesses charge $75 plus per man-hour.
  • One needs to ask themselves if this rate is an acceptable trade-off for their situation.

Speculative Investments

  • If you don’t have a high income, you might be tempted to cut corners and speed up the wealth-building process by gambling on the high-risk, high-reward investments in which so many rich people dabble.
  • Remember, the 1% can afford to take the hit when long odds lead to predictably disappointing outcomes. You can’t.
  • Diving headlong into volatile markets can leave you treading water — or worse.

Pricey Vacations

  • While it’s essential to unwind and relax, extravagant vacations can significantly dent your finances.
  • Consider more budget-friendly travel options or save for that dream vacation once you’ve reached your financial goals.


By avoiding these purchases and habits, modest earners can build a solid financial foundation and work towards achieving their financial goals. Remember, it’s not about the amount of money you make, but how you manage and spend it that determines your financial success.

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