Sun. Apr 5th, 2020

The 7 Financial Myths You Should Know About

Maybe not everything is as they had told you, and when it comes to finances, it is best to investigate, take risks, and see results before just relying on outside experiences. In this regard, in recent years, there have been a lot of financial myths of which it is best to make “deaf ears. “Many people do this, and unfortunately, most take them for granted.

That is why, and because we need that disinformative veil removed from your sight, we will bring you 7 of these great myths with which you may have been deceived and that are greatly slowing your financial growth. Raise awareness to new generations about these types of fallacies that have no foundation, and thus, you will generate a positive change in your financial education. Pay a lot of attention!

1. Never use credit cards; they are bad!

Of the most infamous deceptions present in the world of finance, perhaps this is the one that has had the greatest impact on society. That’s why he leads our list; And how many of you have not been told that using the credit card is something “bad”? The reality is that with good payment management for your fees and changing certain usage habits, it brings with it many benefits and advantages that a debit card cannot give you.

So don’t be afraid of those interest rates, since these are not really the problem. What can give you a couple of headaches is to use it without control, or without planning to make payments. Keep in mind that it is not recommended applying for credits whose fees exceed 30% of your monthly income. It is a fatal mistake!

In addition, a huge advantage that you may not have taken into account is that, through this small plastic, your credit history will improve. And, as if that were not enough, banks offer discounts and promotions to their most “loyal” customers. On the other hand, if you are one of those who love to travel, having a credit card can result in obtaining discounts and travel insurance that will get you out of trouble.

2. You risk too much by investing

This well-known myth in society has kept numerous young people away from finances. Investing should stop looking like something extremely risky. And, the level of preparation of the person in the field where you want to do it has a great impact on the levels of success obtained. It’s not about throwing money and waiting for it to “grow” alone! It is more of a matter of analysis.

Also, remember that everything you want to get quickly is risky, as in love relationships, “What comes easy, easy goes.” This same philosophy can be applied when investing, with the only difference that if you estimate with very planned calculations, the level of risk may fall.
And finally, it is also important to note that there are safe investments (which usually take time) but are worth it. It is a question to ask yourself how much are you willing to invest?

In fact, moving to the world of investments from an early age, thinking about a long-term ROI is a very good way to ensure extra income in old age. The worst part is that the myth has been deeply inoculated into the Millennial generation!

3. Request loans from friends or acquaintances, never to the bank!

This is a myth that you must eliminate from your head, and that can definitely bring you financial and family problems. Applying for a loan from known people can be apparently advantageous, but only if the amount of the amount is low. In such a way that it can be paid in the short term, and we mean not to wait more than three months.

If you require a higher amount, you can request it from financial institutions, or cooperatives (analyzing which of them offers the lowest interest rate). If you do not have the ability to pay, it is best not to borrow, since you could put your credit history at stake and damage friendship or family relationships forever.

The only advantage that could be mentioned of borrowing from acquaintances is that you are not likely to be imposed a specific time for installments to be paid. But in the same way, if you are not strict, it will only generate problems!

4. You cannot save while going through a debt period

We know that at some point in your life, you could have heard this myth. Having debts does not necessarily mean you cannot save. Although it sounds something quite rude to think; A recent study has shown that it is possible to make use of small saving techniques, even going through periods where you sit “up to your neck” of the debit balance.

We know that you probably think that every time you have a capital amount, your only objective will be to pay your credit or loan installments.

The reality is that it is possible to save, but how? It will not be necessary to strictly apply the rule of saving 10% or 15% of your income. You can save minimum amounts on a weekly basis. So that they solve any emergency that comes your way.

5. It takes a lot of mathematical knowledge to keep good finances

The mathematics used in finance is basic and necessary; It cannot be denied because the numbers are in every corner of life. However, it will not be necessary to be a scholar of the calculation to have good financial management. What will be necessary is that you have the clear meaning of interests, assets, types of investment, loans, and knowing the value that a good can take over time (this way, you will have a greater chance of generating investment income).

6. The acquisition of real estate is a waste of time

The idea of ​​buying a property or house has been in this generation disappearing, and a myth has been spread in which it is indicated to be “a waste of time “. When a property is obtained, a purchase is never made in vain. Grant benefits when you want to start a business (mortgaging the property) or have a better chance of obtaining a Visa.

There are many advantages of buying a property, including the fact that it is revalued, so it is usually a safe investment (and as you should know with a long-term ROI). Perhaps the myth is based on the fact of the procedures or requirements involved in carrying out the process. And, you must also analyze the current circumstances of the country where you reside to buy whether it is worth it.

7. Using cash is advantageous

Our last myth, but that has been believed during this last decade, is about cash. Its use has long ceased to be the trend and is no longer completely reliable.

In fact, it could mean a high risk of having all your cash savings. The evolution of money has generated new options that are quite attractive and have many more advantages: electronic cards, payments through digital platforms, and especially the use of credit.

The use of cash if it generates its advantages is “at the moment,” is widely accepted (in fact, in any commercial establishment) and does not delay transactions. However, with other payment methods, you can opt for discounts, membership plans, earn points, and more.