12 Mistakes You’re Making That Keep You Stuck in the Middle Class

Stop spinning your wheels, get ahead by avoiding these money mistakes.
Updated April 9, 2024
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While the middle class has been shrinking since 1971, the upper-income middle class has been growing. Between inflation and the widening income gap, you may be feeling stuck in recent years.

If you find yourself caught in the middle class, you might be guilty of committing certain common mistakes. Avoid these 12 mistakes if you want to give your wealth a boost.

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Spending as much as you earn

dodotone/Adobe woman holding card shopping on smartphone

Lifestyle creep is real. This could look like each time you get a raise or make more money, you increase your quality of living. Or it could mean keeping up with the Joneses and buying things to stay on trend. Either way, living at the top (or outside your means) can keep you from reaching your bigger financial goals.

Staying too long at your job

Drobot Dean/Adobe frustrated woman using computer at work

Switching employers can often increase your pay by 10%-20%. While staying at the same employer might be comfortable, you could be losing out on income each year that you stay. Look for opportunities to move up or switch companies to prevent getting stagnant.

Not investing in anything

Elenathewise/Adobe trading screen with colorful graphs

Investments work best when you leave them alone and let compounding returns take the wheel. Investing, especially for retirement, can help you plan for your financial future. The majority of employers offer some kind of retirement plan. Even if your employer doesn’t offer a plan, you can still invest on your own through IRAs and other accounts.

Resolve $10,000 or more of your debt

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Buying cheap, poorly made products

bepsphoto/Adobe italian bags for sale in street

Paying more isn’t always the right move, but sometimes, buying quality items actually saves you money in the long run. Buying cheap quality items that wear out after a season or break easily may cost you more money, having to replace them frequently.

Not learning about money

Urupong/Adobe woman writing while attending online class

Unfortunately, financial literacy is not taught in most schools. Money is the currency of how our society functions. If you don’t understand financial principles, you can be short-changing yourself. You may be able to find free personal finance classes online or in your local community. Knowledge is power!

Racking up consumer debt

Shisu_ka/Adobe businessman choosing card to pay bills

The average credit card interest rate is 24.66%. Even if the payments are manageable, carrying balances on your credit cards means that you are losing money each month. Avoiding or getting out of consumer debt can help increase your monthly cash flow.

Not having a budget

thanksforbuying/Adobe calculator on financial data sheets

Budgets are often viewed as restrictions. However, they can help you determine where your money is going. Once you know where you're spending money, you can make changes or shifts in behavior to ensure that your spending aligns with your financial goals.

Not having an emergency fund

Vitalii Vodolazskyi/Adobe money jar with emergency fund label

Saving for a rainy day is age-old wisdom, but it’s a saying for a reason. Blown tires, a surprise trip to the doctor, or broken glasses, everyone is at risk for life’s little mishaps. Having an emergency fund for such events helps you avoid going into debt or being unable to pay your bills when these emergencies pop up.

Not shopping around

Costello77/Adobe woman taking out dollars from wallet

While you don’t need to compare the price of every item you buy — not shopping around for bigger purchases could be a habit that’s keeping you stuck financially. A quick internet search for a specific item may alert you to a significant discount at another store nearby or a coupon code you could use to save money.

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Buying new cars

Minerva Studio/Adobe woman receiving new car keys

New cars lose about 20% of their value during the first year. This means if you finance the full amount, you may be upside down pretty quickly. You can save yourself the depreciation and several thousand dollars by buying a used car a year or two older.

Living on a payment plan lifestyle

Andrii/Adobe payment plan written on laptop screen

Payment plan options show up all over ecommerce sites, allowing you the option to buy now and pay later. These apps break up your total into bi-weekly or monthly payments. By shopping with these apps, you’re promising future income for your current purchases. So when payday rolls around, you’ve got these little payments chomping away at your check.

Only having one income source

Vitalii Vodolazskyi/Adobe side gig note on banknotes

If your salary or paycheck is your only source of income, you may not be as stable as you think. With only one income source, you’re only one job loss away from being broke. Diversifying your income with a side hustle or side business can help you feel more financially stable — and bring in extra cash.

Bottom line

tamas/Adobe family homes at maryland

Your current financial habits are what determine your lifestyle in the future. If you’re feeling stuck in the middle class, you can make changes today to help you move beyond living paycheck to paycheck and improve your financial outlook. Start by making small changes in your habits today that will put you on track toward achieving your financial goals.

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Author Details

Holly Humbert Holly is a writer who recognizes that there isn't a one-size-fits-all approach to personal finance. She is passionate about entrepreneurship, women in business, and financial literacy. With more than four years of experience, her work has been featured on MarketWatch and The Ways to Wealth.

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