We all have perceptions about money based on how we were raised, the things we read and the social media we follow. But sometimes perceptions can hold you back, and the only way to grow is to let them go. Show these five money myths the door!
Myth #1: I’m too young to start saving for retirement
Time is money, folks. Every day, someone reaches old age and realises they don’t have enough money to live on. They might not have saved enough, they might not have saved at all, or they didn’t start young enough. You already know we’re about to hit you with the facts about compound interest…
In its simplest terms, compound interest is money that makes money. You invest money, which earns you interest, which grows your investment, which earns you even more interest, and so on. The key is time in the market – the longer you leave your money invested, the more you benefit.
It’s mind-boggling stuff. Read more here.
Myth #2: Rich people own mansions and fancy cars
This myth is problematic because you might think you need to buy the latest Land Rover to feel accomplished and wealthy. Nonsense! When you don’t buy all of life’s unnecessary luxuries, you end up with more money in the bank and more money invested, which you can use for important things like your children’s education.
Don’t let perceptions of wealth pressure you into spending your hard-earned cash on material items that depreciate.
Myth #3: Talking about money is taboo
This is a biggie! We don’t suggest you tell everyone how much you have in your bank account, but we do suggest being open with friends and family about personal finance. Share ideas, tips, tricks and knowledge so your community can learn more. And don’t be shy to ask for help either.
Myth #4: Only rich people have financial advisors
We hear this all too often. Generally, people believe that you need thousands and thousands ready to invest before you can seek the assistance of a professional financial advisor. That’s simply not true. There are lots of different financial advisors who work with people in all income brackets – and they really do provide value. Just make sure the advisor you meet with is transparent about their fees so that you know exactly what to expect.
Myth #5: I’ll never have enough money
The week before payday, when the school fees have been paid, the groceries have been bought and your fuel tank is running low, we all believe we’re just not meant to have money, right?
While everyone’s situation is different and there’s no one-way path to financial freedom, try changing your mindset. Instead of thinking, ‘I’ll never afford that’, ask ‘How can I afford that?’ Let your mind wander. Read articles like this one, listen to podcasts and experiment with the budgeting tool on the 22seven app. With greater knowledge comes greater power – the power to save more, earn more and grow more!