According to Wikipedia, “A myth is a traditional story consisting of events that are ostensibly historical, though often supernatural, explaining the origins of a cultural practice or natural phenomenon. The word “myth” is derived from the Greek word mythos which simply means story.”
Here’s the hard truth – sometimes our beliefs about money are the very things that cause our problems.
The even sadder truth is that we don’t really know which among these beliefs are actually false.
Let me help you sift through some of the money myths that you were falsely led to believe over the years. I hope that by doing this, I can help you evaluate your beliefs. From there, you can start getting rid of the ones that are hindering you from enjoying financial freedom.
MYTH #1: I am still young. It’s too soon to start saving now.
Truth: Your savings is something that you intentionally put aside to prepare for future use. The famous adage, “Time flies when you’re having fun,” is something that teaches you about how quickly the years go by. Before you know, you’re already in your late 40s and you have not set aside a single centavo in preparation for your future.
MYTH #2: Credit cards are bad!
Truth: Whoever told you this must have a really traumatic experience with credit cards. But the truth is, credit cards are not bad. Credit cards don’t make decisions for you. It was YOU who made the decision to splurge on a very expensive pair of shoes, brand new cellphone, tickets to an international getaway – even if you cannot afford to pay for it when the bill comes.
MYTH #3: You don’t really need a budget because you keep track of your money anyway.
Truth: This is a trap! You may be able to check the contents of your bank account through your mobile phone and make mental computations about how you will spend them, but reality is, it is highly likely you can spend more than you hoped to do so.
MYTH #4: You can pay all your debts when you get your retirement fund.
Truth: Are you serious? You’re going to use the money you get after you have decided to stop working to pay off debts? Think again. You should pay off ALL your debts while you are still employed and earning. Your retirement money is reserved for when you are no longer working. This is the money you will live on.
MYTH #5: So you don’t have to touch your savings, borrow money.
Truth: Whether you intend to go on a trip, get your house fixed, buy new appliances, or pay for your child’s school fees, SAVE up for it. Don’t make soft loans in order to pay for your dues, if you can help it.
THINK. REFLECT. APPLY.
- What other myths do you have about money that are not mentioned above?
- Do these money myths hinder you from managing your money well?
- What do you need to change about your beliefs on money?