Money plays a massive role in everyone’s life. And knowing how to work your way through it is quite important. There are several myths surrounding money that are widely spread into something very fictitious that lead many of us to go spiraling downwards.
Experience, they say, helps you understand how life works, and how remarkably different it is from what you see around you. Similarly, money misconceptions fall under the same category. But as strange as it may be, we learn to make money in such unusual and downright scary approaches.
In this age of plastic money, young children are less keen on understanding the value of money, making them believe that one way or the other, it’ll come into our hands. This makes it quite a troubling economic climate which undermines the importance of financial responsibility. Handling and teaching the right way to handle money will take us a long way into affluence.
Here are 8 popular misconceptions that we come across that need to be shattered.
1. A big income will keep me out of debt
Most of us think that a big paycheck will keep them out of debt, however, it’s only a part of it. One thing we tend to lose focus about is the more we earn, the bigger the spurge. Debt always rises with income.
A good salary isn’t going to help you survive if you do not understand the importance of budgeting right. Create emergency funds that will help you in case you lose your job or cannot work for some reason.
2. More the money, less the worry
It’s all a claptrap that makes you believe that more the money, less the worry. Many of us get so entrapped to these ideologies, that we tend to go an extra mile to make it work.
Money doesn’t end anxiety. In fact, it increases every time you lose it. People earn money so that they can make ends meet. And bigger the amount, more the problem. So, regardless of how much of money you have, problems will still find a way to get to you.
3. Budgeting isn’t needed
Budgeting is crucial. It teaches you to spend wisely and makes you take an effort to work on your situations. It helps you stop worrying about how much you have left or count before you buy something. In fact, it helps you reach your goals a lot faster.
Most people give up budgeting especially after two or so months because they fail to see the success behind it. In order to make it all happen, you need to understand that budgeting is a slow process that reaps big rewards.
4. Money means security
Partially, money does help you with security. It allows you to control your environment by being prepared for the unexpected. But there’s not enough money to control every single thing going on in the world.
However, an unanticipated turn of events can occur whenever, and it could boggle us onto a sea of uncertainty, no matter how much money we have.
5. Money is so funny in a rich man’s world
The world portrays millionaires as those who drive fancy cars and live in a fancy house. But after my read on, The Millionaire Next Door by Thomas J. Stanley, it’s quite the contrary. These people are no different from the ordinary. They probably drive their boring cars or avoid designer labels. They prefer building wealth and living a regular life rather than trade it to risk their financial freedom.
It takes time to build an empire, but only a few seconds to watch it crumble to ash. Hence make the right decision to impact you better.
6. Money means travel
The world is an interesting place to travel about around. And traveling comes in various budget sizes.
We sometimes bend our budgeting plans and pay through our noses. And sometimes we apply for loans, to get to where we want. And as fascinating and daring it may be, it has the ability to create a massive hole in our savings and pockets. So don’t splurge if you can’t, but if you still want to see a faraway place, you’ll make a way.
7. Piling up the debt
Most of us, go through our daily lives, piling debt over debt. We use our paychecks to pay off interests and other credit-related issues. This mentality makes it easier to find ourselves in situations that are difficult to get out of.
Paying off debt on time or avoiding them entirely, can affect our budgeting goals, positively. It would help gain financial freedom with no strings attached.
8. Too young to save
It’s never too late to start saving. Many of us give out excuses to how we don’t know how to execute the idea of saving. But the main idea is to break the mental barrier and set the right course of budgeting. Budgeting right helps you save a little bit every day without causing you to burn a hole in your pockets. Starting early ensures you get into the right habit helping you build wealth easily.
If you’ve fallen to prey to any of these misconceptions, try to change, one point by one. It can never be easy to let go of what you used to believe in or the habits you used to follow. But understand, that if it’s difficult, it can certainly be worth something!