There are major differences between how the poor and rich think about money. This post is not meant to bash the poor or praise the wealthy. I realize that many people in poverty do not have a poor mindset and are trying to save money to better their lives.
Poor mindset (typically):
People living in poverty with a poor mindset will spend any money leftover each month on junk they don't need. This includes:
Rather than putting their spare money into a wealth-building account, they spend it immediately for instant gratification. As a result, these poor people find themselves in financial pinches when something goes wrong (lose job or an emergency). Then they are forced to take out high-interest loan and credit cards, setting them further back financially.
Wealthy mindset (typically):
People who are wealthy typically think completely differently from people in poverty. In general, wealthy people are concerned about maintaining and growing their wealth. This is accomplished through:
The wealthy's financial choices revolve around ways to invest to earn more money and planning ahead to prevent losing their money. This is why the rich keep getting richer, and the poor remain in poverty. Of course, wealthy people do spend money on entertainment, food, cars, vacations, and other "fun" stuff. The difference is it won't usually set them back financially, like with poor people.
You don't have to be wealthy to have a wealthy mindset. Having a "rich" mindset is all about forward thinking. A poor mentality is all about instant gratification, while a wealthy mindset is being mindful of how you current choices will affect your future.
I highly recommend reading 11 Poverty Traps You Must Escape Right Now If You Ever Want To Be A Millionaire.