Whether you accept it or not, Money is an important factor in our lives in this day and age, And it affects everything and decision. Your goals, time, identity, and your freedom to a large extent. A lot of people do not have a good relationship with their personal finances, they have refused to acknowledge and face their money problems head on.
Irrespective of your financial situation, poor, middle class or rich, You could still find yourself making bad financial decisions, that cause issues in your relationships or other kinds of financial troubles, Recognizing some of the common lies about your finances is an important step to take in other to take full control of your finances and reach your financial goals.
Here are some of the money lies we tell ourselves, and this happens unconsciously most of the time:
1. I'LL START SAVING MONEY LATER.
There's lots of conflicting information regarding savings, Some financial gurus and advisers believe saving money is for losers and it's not worth the effort and they have their reasons, Other's believe its a good wealth building strategy. Both opinions are not not entirely wrong or right. But an important fact to consider is, In today's fast changing technological and modern banking age, Money can get easily devalued and lose more of it's value due to a variety of factors, Inflation being a major contributor to this. Also, Having a savings fund is vital to anyone considering financial freedom and early retirement, But it must be done correctly, with a plan and intelligently.
Instead of just stacking up and hoarding up your money and then storing it all in the bank, Your money should be converted into investments and acquiring of assets like equities or real estate which will actively benefit you or increase in value with inflation and also give tax breaks.
The best time to start saving money is now, But it should be done with a well thought out goal in mind, Like investments, Retirements and Emergencies in the future.
This is another line/lie people like to repeat, And it's funny because, The more you say this to yourself or anyone, It becomes true and eventually becomes your reality. If you have money to subscribe to Netflix, Buy new pairs of your favorite designer clothing or shoes, Go off for vacations and so on, then you have money to invest. Financial independence is all about choices you make daily. It's about what you consider important enough to choose to commit your money to. If Investing is a priority to you over short-term gratifications like buying more material goods to show off, impress friends and neighbors (None of these is bad or wrong in itself, if it makes you sleep better) We are are all free to do what we want, But doing less of material possessions will make money available for investing.
For everyday that you don't invest, You're loosing your money to the banks and inflation and you may not realize this until it's too late. Educate yourself on investing and investment basics, You will thank your future self you did this.
This is the perfect excuse for young people to continue procrastinating, not embracing being responsible with finances and not taking action.. Life gives you what you put in, And waiting on chance and luck will probably prepare you to fail and become miserable and filled with regrets at 65.
The future can seem to be really far away when you're 18, 24 or 33, So it's really easy to make this excuse not realizing you're running out of time. Being young is an opportunity to begin planning early. Embrace taking risks and learn high earning income skills that will benefit you and the people you love as your grow older.
There is no such thing as good debt, Debt is debt and it's not good for your financial well-being. From car loans, student loans, mortgages, credit card debt and so on, All debts/loans come with some cost. Most probably, Some debts could be worse than others, But the wise measure to take is to do as much as you can to avoid being in any kind of debt situation(Bad debt).
Whatever kind of debt you get into comes with some form of interest during repayment and this interest is always going to be much higher than you think. Before deciding on taking any loan, Ensure you do the math on the total cost you will have to pay back then decide if the loan will help you achieve your goals or be a good boost to your finances or not, If it's not worth it, You should probably not get in it.
Having an "All Debt is Bad" mentality will help you look for better ways to go about your finances.
Humans are great at hoping, fantasizing and living in a much desirable future, while ignoring the present state of things most of the time. This is definitely not a bad way to live since it's almost natural to do this, But thinking this way should always come with taking some action and not leaving it all to chance. Some people will go as far as purchasing luxuries(cars, homes) that will stress their finances beyond their means, And then justify this purchases and expenses with the thought that in the future, their finances, salaries will increase, Or they will get more sales and customers in their business.
Life has no guarantees and unexpected events happen all the time. Living in the present and planning for the future should be a better way to live your life.
When it comes to your finances, Being honest with yourself about the state of your money will help you a lot. The things we tell ourselves and believe about money will influence our decisions and choices one way or another. To start growing your wealth, You should recognize the lies you believe, Make a change and start taking action towards making much better choices and becoming a better manager of your Money.