11 Myths about Money

Forget everything you've heard about credit. Well, perhaps not everything. "Living within your means" is obviously important, but you should be ready to rethink that which you know. Because when it comes to debt, credit reports, and credit scores, conventional wisdom is peppered with 11 Myths about Money, misunderstandings, and misrepresentations. Credit is really a tool. Like any tool, it's neither good nor bad in itself. What matters is how you use it.

Money is a bad thing (and rich people too)

This is actually the biggest myth about money, and it's easy to understand why. Quite a few issues are related to money, either by its scarcity or by its abundance.

On the one hand, it's common to believe having additional money will solve your entire problems. On one other hand, it is also vital that you see money as a perverting part of people. It is the classic “look how Jaden has changed since he won the lottery or since they made him boss.”

The truth is that money is neither bad nor good; it's more of something that can help you achieve your vital goals, depending how you use it.

It's normal to have a lot of debt.

If you have a mortgage, student loans, an automobile loan, and a maxed-out bank card or two, you're not alone. According to Experian, consumer debt reached accurate documentation high of $14.1 trillion in 2019. 

Many individuals need to get a loan to get an automobile, house, or earn a degree.

Millionaires are those who make a lot of money

What's it want to be really rich? To produce a lot of money or to truly have a lot of money? They may sound the same, but there is truly a subtle difference. In fact, you possibly can make a lot of money, millions even, and not be described as a millionaire.

Advisers Push You Into Products That Make Them Commissions.

Ok – this is truly a half myth. In Australia about 60% of advisers are aligned to one of the major financial institutions, each with a myriad of products they have the ability to offer relevant customers. The financial advice industry used to check out a commission-driven sales approach, and recently all big banks have committed to winding back the “deep-seated” culture of product-based incentive payments.

Your Finances Are Too Simple For Advice.

You could not have a lot to manage, but it's possible you're missing out on opportunities because you never understand them.

Instead you need to treat an economic adviser like your doctor. Having an adviser working with you throughout various stages of your life is akin to seeing a doctor as time passes for annual checkups. The relationship you build can help you spot an issue in its early stages, instead of when you're in tremendous pain. And yes it never hurts to acquire a second opinion!

Investing is only for the rich

In line with the above, many people believe investing is just for the rich or for people with plenty of money. Nothing is further from reality. Today there are investment options suited to all profiles starting at $100 a month.

The only real rule you should follow before investing is to truly have a financial cushion for emergencies, which must certanly be in a safe place and free of all risks.

Saving is for the future

Most people save for contingencies and to secure their retirement. In other words, they save for the future and not so tangible and unspecific goals.

Thus, saving becomes a difficult journey. The clear answer is to change your approach and make the most of the tiny benefits that saving provides in your daily life. The initial one you merely saw in the previous point: because you've a contingency cushion, you live with less stress.