We all make mistakes with money. There's no one size fits all situation when it comes to handling your finances. There are many factors that make up your unique money profile, income, age, family size, living arrangments, etc.
At some point to be successful with your cash you need to stop perpetuating lies about the state of your finances. We need to take control, educate ourselves and stop believing in these money lies which will only continue to hold us back.
11 Money Lies to Overcome
Money is the Root Of all Evil – Money is not evil, money and credit are just inanimate objects. Money is a tool and if used correctly, and wisely can do a lot of good. When abused it can lead to stress, fights, resentment, and broken relationships. Which do you prefer?
Minimum Payments are Okay – Ever seen a hamster run on a hamster wheel? How far did he get? Paying minimum payments on any debt, credit card, student loans, car, etc. will not get you out of debt. Two keys here stop adding new debt and make more than the minimum payment each month to be successful in getting out of debt period.
By Ignoring your Finances, they will Get Better – Ever see an Ostrich with his head in the sand? You need a plan for your money plain and simple. I don't like to budget because it's too restrictive; well adjust the budget to fit your needs. Ever see a football team win with a playbook? Ever see anyone build a house without a set of blueprints? I think you get the point.
Saving will be a Priority after my Next Pay Increase – No it won't. Something will come up to derail this plan, unexpected expenses, a once in a lifetime opportunity, and there will be some reason that will prevent you from saving unless you make it a priority. A cash cushion gives you options, the piece of mind and the sooner you have it, the quicker you realize it.
Everyone Else is Getting Married, and Buying a House; I should too – You don't have to follow the herd. You have to define what's best for you, and your situation. Don't spend money or commit to something just because others are doing it. Define your own goals, and it is okay if they don't look like everyone else.
I don't know enough to start Investing – So education yourself. Don't waste the chance at free money from an employers 401K match. There are plenty of resources online or books on the topic that are easy to understand. Don't be naive or let fear rule the way you handle your money.
The need to establish Credit – Why? People say this all the time, but don't understand why. Unless you are looking to borrow money you don't need a credit history. Many people have purchased a home or rent without a credit history. How? They had a solid job and cash savings. No credit history needed. Before you go and run up bills trying to establish credit understand why and how it fits into your overall financial plan.
I deserve it – The I deserve it, I work hard mentality has entitled people for decades. People do work hard, and they do deserve to be rewarded, but with good planning. Don't go nuts on a week-long vacation and spent the next ten years paying it off, or impulse buy a new car because you had a bad day at work. Save your money, reward yourself with good planning and judgment and you will enjoy that vacation so much better.
Everyone has Debt – Not true. Many do, but you don't need to be another statistic. Just think of your current income minus your debt payments to credit cards, car, etc. What could you do with that extra money each month? Build wealth, save for a vacation, save for college, etc. The possibilities are endless once you get out from under the debt.
Credit Cards are ideal for Emergencies – No they are not. Cash is king. Credit card forces you into revolving debt for years unless you can pay them off in full at the end of the month. If you could do that why not just use the cash in the first place.
Retirement Saving is for Old People – You might use it when you are older, but saving in your youth is to your advantage. Let compound interest work its magic in the early years of your life, the sooner you can start the bigger nest egg you can build. Starting early prevents you from having to play catch up later in life and saving more when you might need it the most.
These eleven money lies are general guidelines that you should be thinking about when it comes to being successful with your money.
It is important to remember that your individual goals and plans do not have to look like everyone else. There are many ways to be successful you just have to find the right path for you. Good luck!
Brian is a dad, husband, and an IT professional by trade. A Personal Finance Blogger since 2013 who, with his family, has successfully paid off over $100K worth of consumer debt. Now that Brian is debt-free, his mission is to help his three children prepare for their financial lives and educate others to achieved financial success. He blogs at Debt Discipline.