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Being broke sucks but there are lessons to be learned. These are the 13 things I learned when I was broke.
There’s Broke, and There’s Poor
First thing’s first. Being broke is not the same thing as being poor. Being broke is temporary. You’re a student, you’re between jobs for a few weeks, your car broke down, and you had to fork out unexpectedly for repairs. Being poor is much harder to climb out of and can have adverse long-term consequences.
But in the immediate moment, being broke feels like being poor, and some of the immediate problems you face are the same. I learned some harsh but valuable lessons when I was broke that might help you too.
I’ve been broke a few times in my life. In college, right after college, and right after moving to New York City. All of these times are long past, almost 20 years ago but I still remember them vividly and the lessons I learned then, I’ve never forgotten.
1. You Have a Lot of Food
How often have you opened your fridge door or the pantry and thought, “There is NOTHING to eat in this house!” while staring at shelves and shelves of food? Turns out nothing is relative and being broke proves it.
If you have to choose between buying gas to get to work and buying more food, you’ll figure out how to make do with the “nothing to eat” you already have.
Yes, it may not be what you’re in the mood to eat or what you’ve been craving, but it will still make your belly full.
All of those cans of random vegetables, soups, and tuna in the pantry can be combined in some way with the three pieces of stale bread, two old carrots, and half a jar of olives in the fridge. Pretend you’re a contestant on the Food Network show Chopped!
2. Sometimes Cheap Stuff is Better Than Expensive Stuff
When I first moved to New York, I needed to buy coffee. I grew up drinking Folgers or Maxwell House. But in NYC they were more expensive than something in a bright yellow can called Cafe Bustelo. Now, I need coffee, but I’m not a coffee snob, so I grabbed the Cafe Bustelo because it was the cheapest option.
Holy Cow! Cafe Bustelo is sooo good! It’s so much stronger and richer than what I had been drinking. It’s the only coffee I have bought for home use since. If for some reason it was no longer going to be available I would spend whatever amount of money I needed to to ensure I had a lifetime supply.
And it taught me a valuable lesson; sometimes the cheaper option is better than more expensive options.
3. There is a Lot of Free Entertainment
We spend a lot of money to entertain ourselves. We buy books; we go to the movies, we buy concert tickets. But there are so many free ways to entertain yourself. You can get free books and movies (and lots of other stuff) at your local library.
Take a look at your local newspaper or events magazine (most of which you can find for free online) and see what free events are happening near you.
Binge on a new podcast. Listen to them while you do something else that’s free like going for a run, a walk, or a bike ride. A lot of museums have a free day every so often.
I live in New Orleans and the art museum, as well as the botanical gardens, are free for Louisiana residents every Wednesday. In fact, if the temperature reaches 93 or higher, the art museum offers free entry the following day as well as free snowballs (the local term for a snow cone)!
4. You Can Socialize Cheaply
A lot of times when we make plans with friends, those plans involve spending money. We go to dinner; we meet for drinks, we go shopping together. But if the point is to spend time with friends, you don’t have to spend any money. Go for a walk in a park, meet at the beach, or cook dinner for them at your place.
There are dozens of things two or more people can do together that don’t cost a fortune; it’s just that they take a little more planning than just making a dinner reservation.
5. No One Thought Less of Me
During and right after college, most of those in my social circle was more or less in the same league financially. We were all your typical broke students and then your typical entry-level job having recent college grads.
So if someone got some birthday money and wanted to go somewhere nicer than usual, but the rest of us couldn’t swing it, we just compromised and went somewhere we could all afford. No one felt bad or embarrassed because we were all in the same broke boat.
That changed when I moved to New York. I was around people who had plenty of disposable income. I was making better money now but the cost of living increase was enormous. So when a new friend suggested a pricey restaurant, I hated to beg off. And for a few months, I didn’t. I just charged those nights out.
I can tell you that didn’t last long because even charging those nights out; it was still a struggle. Those bills had to be paid eventually. But when you’re in a new place, you don’t have a lot of friends yet.
I hated to keep telling the few friends I had, “No” every time they asked me out. The first few times I came up with some excuse, but if you keep doing that, people will think you don’t want to spend time with them and eventually just give up.
Not wanting to be friendless and broke, I had to start telling the truth. I couldn’t afford to go out. No one made fun of me or made me feel bad. I wasn’t even excluded. Most of the time they would just suggest something more affordable, and we would do that.
6. Credit Cards Are Dangerous
I don’t want to scare anyone away from credit cards entirely. They are a tool, and you can use them well or use them poorly. Used well, they provide things like cash back, purchase protection, fraud protection, and perks like air miles and hotel points. Used poorly, they can plunge you into decades of debt and even bankruptcy.
When you’re broke, credit cards can seem like a life saver, but it’s just such a dangerous time to use them. Being broke is usually temporary, but you don’t know how temporary.
Living on credit cards for two weeks between jobs is not the end of the world. Living on them for four months between jobs very well could be.
I learned my credit card lesson pretty fast thankfully after the whole paying for dinners I couldn’t afford episode and stopped using them to buy stuff I couldn’t pay cash for. Your credit cards are not a replacement for an emergency fund.
7. Your Clothes Aren’t That Dirty
I luckily have my very own washer and dryer in my apartment now, a luxury I lived without for the 15 years I lived in New York City. All of the buildings I lived in had on-site washers and dryers, but they were coin operated, and I was broke so my small change, well, wasn’t small change!
Unless you work a very physical job where you get hot and dirty, your clothes don’t need to be washed after every wearing. I know this goes against whatever Puritanical notions we seem to have about cleanliness in America, but trust me, it’s true!
When I was broke, I did not wash any of my clothes apart from underwear after every wearing. And I washed the underwear in the sink and hung them to dry over the shower curtain rod.
I still don’t. I work from home wearing jeans and a t-shirt most of the time, and at the end of the day, those things aren’t dirty enough to require a wash. The washing and drying process is also tough on clothes, the less you wash them, the longer they last.
No one has ever accused me of being smelly and believe me; I have the kind of friends who would if I needed telling! As a disclaimer, I do wash my towels and sheets once a week but never, ever wash my jeans unless I spill something on them or sit in something.
8. You Have More Than You Think
If you don’t keep a budget, you probably have more money than you think, even if you’re broke. Everyone has at least one area where they spend more money than they’re aware of. Setting up a budget to track your spending can show you what those areas are so you can start paring back.
When I did this, I saw how much money I was spending on food and was shocked. It was a lot. I like to eat fresh food so I would go the grocery two or three times a week. Doing that meant that I was never spending a huge amount of money each trip, so I didn’t think my spending was unreasonable.
But when I added up all those grocery trips for the month, the number was pretty big. This nasty little revelation is what made me eat my fridge and pantry clean before I went to buy more food. I think it was a few weeks before I really didn’t have any food left.
9. Being Broke is Expensive
Remember my Cafe Bustelo discovery? Buying that coffee one day taught me another lesson. Being broke is expensive. I used my debit card to buy a can which I think cost about $3.50 at the time. There wasn’t enough in my account to cover it. Imagine that; I didn’t have $3.50! I’m not exaggerating when I say I was broke.
But the transaction went through. I only found out I didn’t have $3.50 because I got hit with a $35 insufficient funds fee. I should have known how much money I had (or didn’t have in this case) but like a lot of broke and poor people, I was always afraid to look at my bank balance.
I have always had a terrible fear of my card being rejected, even when I know the money is in there.
For years I would pay cash for everything just to be sure it would never happen because I couldn’t think of anything more embarrassing. But looking back, I think I would have preferred the embarrassment of the declined card than the $35 fee which obviously I could ill afford.
So that $3.50 can of Cafe Bustelo cost me $38.50. I never forgot it. Being broke is expensive.
10. Being Broke Hurts Your Long Term Goals
My first job in New York offered a pretty good 401k plan. It even had matching which is free money. But I was so broke I couldn’t afford the extra money out of each paycheck that participating would have required. So I didn’t.
Out of all of these lessons, that was probably the best one and the hardest one to swallow. Because most of this stuff can be undone or is temporary. But when it comes to investing, there is no way to make up for lost time.
And as it turned out, I never worked for a company big enough to offer a 401k again, so it was years before I finally started my own retirement account. I not only lost that time, but I also lost the free money from the matching too. I’m still mad about it!
11. You Can Get a Lot of Stuff For Free
It’s not so much that I went around collecting free stuff when I was broke, it’s that when I started going through my stuff, I realized how much free stuff I had.
Free toothbrushes, dental floss, and toothpaste from the dentist. Free bars of soap, shampoo, and conditioner from hotels. Free samples of laundry detergent and dishwasher liquid that come in the mail. Free samples of beauty products from department store makeup counters.
A whole treasure trove of free stuff!
We all collect these things but often toss them in a drawer and forget about them. Don’t do that, use them! And use them right away. Most of that stuff was still good when I was broke and needed it, but a few of the samples had dried out and had to be thrown away.
Now when I get those things, I use them right away. Using free stuff means you don’t have to spend money on it which helps keep you from being broke!
12. It Wasn’t That Bad
When I look back on all these periods of being broke and even at the time, they weren’t all that bad. I still had fun; I still saw my friends, I still had food to eat and a roof over my head. Maybe, apart from the next and the last lesson I learned when I was broke, that is probably the most important one.
I didn’t need to have a lot of money to be happy, to have fun and friends and make good memories. It was the period of brokeness in New York that introduced me to one of the best things in my life, the Metropolitan Museum of Art.
At the time, it was pay what you wish. It’s different now; it’s free for New York residents but $25 for anyone else.
On sweltering summer days, I would pay $5 and spend a few hours there because my apartment was hot and I was afraid to run up my electric bill by running the air conditioner. To this day, it’s my favorite place in the world. No matter how bad things were in my life, going there made me feel better.
The priceless things in that museum have survived for thousands of years, and that always made me feel better. I knew that I could survive too.
Going there is one of the last things I did before I left New York to move to New Orleans and when I left I cried and cried. When I finally went back for the first time since I moved this past June, I cried and cried when I walked through the door.
It was and is my oldest friend in New York, and I miss it every day.
Had I not been broke all those years ago, I would never have spent so much time there and developed such a fondness for it. And my life would have been poorer for it, much poorer and in a way that has nothing to do with money.
13. I Never Want To Be Broke Again
Being broke wasn’t the most horrible thing in the world. But it wasn’t exactly the best time of my life either. And not because of the lack of money necessarily. As I wrote, I had the basics and then some.
It was the stress, and the lack of freedom that I hated and those are concepts I still hate even though I no longer suffer either.
Ever since that last broke period, I vowed, Scarlett O’Hara like, never to be broke again. I continue to follow these lessons, not quite so strictly all the time, but most of the time.
And I never have only a single source of income. I work from home and have several writing clients, so it’s easier for me than for those who work more traditional 9-5 jobs. But it’s so important that I really urge you to find the time to bring in extra money from something not tied in any way to your regular job.
Do something so that if for any reason you were to lose your primary job, you wouldn’t have $0 coming in. Because being broke really sucks!