Facts and Myths about Money
#1 My spouse or my significant other will take care of me.
It is certainly possible that you could be in a position where your spouse or significant other is the “Bread-Winner.” It’s a dream come true for someone else to handle all the finances and there are relationships that operate this way. Unfortunately, in this day and time, many households suffer financial turmoil with only one income. With the divorce rates skyrocketing and money being one of the top reasons for divorce, it’s in a couple’s best interest to get on top of their finances from the very beginning. The term couple means 2 people. Therefore, you must be an active participant in the financial part of your relationship. Just understand that clear communication and transparency will play a vital role. Each person needs to be completely honest about his or her earnings and spending habits to put a detailed financial plan in place. We haven’t even mentioned adding savings and investments to the equation. So let’s take off the shield and realize it’s not practical or even a safe move to assume your spouse or significant other can be counted on to take care of your finances.
To be quite honest, we can not control the future. So what happens if your spouse passes away? Let that sink in for a minute.
#2 If I made more money I would be able to do better
Although this may be a partial truth, how many times has the income of a person increased and they only seemed to continue to struggle financially. Many times it’s not the income, it’s how you spend what you earn. Haven’t we all heard of super stars that make millions and go broke. People have won millions in the lottery only to return to a less than millionaire lifestyle years later. On the other hand, there are financially sound-minded people that make $60K -$75K yearly, live a modest lifestyle, and manage to acquire a nice sum in their savings and retirement fund. Check out the statistics: 55% of Americans don’t have enough savings to cover essential living expenses. What’s the difference? Spending more than you make and having really bad habits will create serious problems no matter what your earning or “gifted” income level. Therefore, start where you are currently. Become disciplined and develop good financial habits, which we will talk about in another blog.
#3 I am too young to worry about money
Wrong, wrong, wrong!! It’s never too early to learn about finances. As a matter of fact, the US school system should incorporate a class on finances. This could positively impact the financial illiteracy that plagues our society. In addition, Most times 20 – 30 year olds only know about checking and savings accounts. Neither one of these accounts will secure your future retirement. But if 20 year olds would learn about investing and apply the knowledge, they would have a significant jump financially. At this age, there’s the greatest benefit in compounding interest. It’s really worth your time!!
#4 I am too old to start thinking about money
This is Wrong, Wrong Wrong! Even though precious years may have been lost, start just where you are. There is not a better time than the present. Learn and Apply pretty quickly. There are many books, podcast, blogs, websites, youtube videos, and seminars that teach financial literacy. There’s really no excuse. If all else fails, you can get a financial advisor to help you. Make sure you ask about fees upfront. This could be a deal breaker.
#5 I have made such a financial mess of my life and I can’t get over it
First of all, let’s dispel this belief. Haven’t we all had times when we were a child, and we made a mess? The number one resolve was that we were told to clean it up. Well think back to when you had to clean it up. Piece by piece, section by section, or area by area we would clean it up until it was all done. So If you made a mess financially then lets clean it up.
QUICK FINANCIAL CLEAN UP 101
- Gather all financial documents
- Get a financial spreadsheet. Here’s a link to a simple free one. https://www.consumer.gov/sites/www.consumer.gov/files/pdf-1020-make-budget-worksheet_form.pdf
- Fill it out in it’s entirety
- Now look at the things that you really don’t need – Be Honest!!
- If you have credit cards – you will have to get those paid off. Right now you are just listing everything so you will have a clear idea of where you stand.
No matter what your situation, just remember, If you DILIGENTLY seek the knowledge, it will come to you. Now keep reading and learning. Time is of the essence!!
PS: If you don’t know a word that may be used while exploring, use your phone for more than social media. Ask Siri, google, Alexa or search the word.
