3 Money Myths You Should Stop Believing
In this blog we are exploring three common money myths! Our responses to these myths are not always true across the board, and some people’s situations may require a more in-depth and personal look by one of our financial experts. Come talk to us about your finances if you want more clarity on whether how you handle your money is rooted in financial facts or myths!
Myth #1 Cash is always better than credit. In most instances, paying for expenses with money you already have in your account is the better, more obvious choice. However, there is a time and a place for using your credit card. Credit cards tend to get a bad reputation because of the threat of debt they can carry with them, but they also have benefits that can help your finances in the long run. For example, many credit card companies offer rewards for using their services: travel miles, cash-back systems, and other rewards. Credit cards also offer a safety component to your finances, since most of them offer purchase protection, which protects you from getting scammed by companies. On big-ticket items, using a credit card might be the smarter move, just in case something happens along the way in the business transaction. The credit card company will usually credit the funds back your account in the case of fraudulent activity, and investigate the seller for you. You may not have the same luck with a debit transaction.
Myth #2 You should buy a home at all costs. Everyone wants something to call their own, but sometimes buying a home is not in a person’s best interest financially. As a society, we tend to follow this way of life; you go to college, land the perfect job, get married, buy a house, have kids, and live happily ever after. However, this is obviously not the case for everyone, and may be unrealistic for many Americans. Depending on your situation, there are always other options besides the “traditional” route. Although there are several merits to owning your own place, buying a house is a huge life decision that needs to be made with certainty. Maybe buying your own home isn’t in the cards for you right now, but that doesn’t mean it will never be. You should only buy a house when it is within your means to do so, and we can help you to know what that might look like! The notion that a home should be bought at all costs to avoid paying rent to a landlord or to be able to personalize the space you live in is foolish.
Myth #3 Investing is only for rich people. We may be starting to move away from this stigma as a society, but it is still important to touch on the fact that anyone can invest. No matter what your financial situation or stability level looks like, you can seek professional guidance, if necessary, to get help capitalizing on investments that are as low-risk or high-risk as your situation allows for. Saving money is great, but letting your money work for you in the stock market or other financial institution is even better. Typical savings interest rates are not nearly high enough to significantly grow your money, even over a period of many years. Again, always do your research and find the best option for your unique situation! There are even several investment apps like Acorns that will walk you through the process to get the best future returns on what resources you have right now.