Debunking The 25 Most Outrageous Money Myths (part 4 of 4)

In continuing the series on debunking these most popular and 12+ pages being too much for one post – here is part 4 of 4 on the series Debunking The 25 Most Outrageous Money Myths.  Part 1 can be found HERE.  Part 2 can be found HERE.  Part 3 can be found HERE.

19. Money Corrupts People

Very similar to #1 of it being “the root of all evil”. Money itself isn’t the corrupter. Think of how many good things have happened in this world with money. How many charities, art pieces, hospitals, parks, etc have been made with this “corruptive money”.Yes, there are people that will use the money in corrupt ways, but the money itself isn’t the enemy. You’re trying to walk again on the higher moral ground than those with the money.

20. My Best Investment Is My House

First off, if you paid the full amount for your house and plan to live in it for 20 years, it may be a good investment, but if you’re like the 99% of the world that can’t do that, it’s hard to justify it being a good investment when you’ll likely pay at least double that amount over the life of your 30-year loan.Additionally like all other investments, home ownership involves the risk that your investment may decrease in value. While commonly cited statistics say that housing appreciates at somewhere between the rate of inflation and 5% per year, if not more, not all housing will appreciate at this rate.In fact, it is perfectly possible for your home to lose value over the years, meaning that if you want to sell, you’ll have to take a hit. The only way you’ll avoid realizing a loss in such a situation is if you continue to own the home until you die and pass it on to your heirs.

21. I’ll Save Money When I Have Enough

When is enough enough? This can work if you set a number and stick to it. Say you’re going to start saving when you make $1500 a month, and stick to it. That could work. But I’d recommend sticking in as much as you can up to and through that amount with a percentage of your money instead of a dollar amount.Any amount of money you save, no matter how small, is enough to save. The habit of saving money is more important than the amount.

22. I’ll Never Get Rich In This Down Economy

“There’s more than one way to skin a cat.” SOMEONE is making money when the rest of the world is not. Money doesn’t just evaporate; it’s going somewhere. You just need to find where that is. During a recession, good sectors to put your money are in places that people have necessity: medical, food, and energy are resources that people can’t live without, even in a down economy.The key is to understand that there’s always an investment that’s good right now. When stocks go down, bonds go up. When interest rates fall, stocks go up and homes get cheap. If the economy is ‘bad’, that means it’s time to sell your bonds at a profit and buy stocks at a discount.

23. If I Carry A Balance On My Credit Card I Will Improve My Credit Rating

All your improving by doing this is the amount of money the credit card company is making off you. Your credit gets better by proving you’re a good borrower and pay it off each month.If you want to take it a step further, don’t charge more than a 35% of your card’s limit because the amount of available credit you’ve used is another component of your credit score.

24. Money Is A Big Responsibility

Well, yes it is, are you saying that you’re not responsible enough to have money? Even the most irresponsible of the wealthy can keep it flowing. It’s not about responsibility, it’s about your mindset to think you can never attain wealth and this is your excuse for it.If you think of money as a burden, it will become burdensome to you. Even if you do somehow to become wealthy with this mindset, you’ll end up letting it work you into penny-pinching with it rather than finding ways for it to maintain itself and grow to a bigger pot.Obviously, money doesn’t have to be a burden, quite the opposite. It can help you lift burdens that were created before it. if your money works for you, it can lighten your burdens. This myth is a powerful and self-fulfilling thing.

25. Renting Is Throwing Your Money Away

It is a mindset that has been captured a handful of times across the blogosphere (1, 2, 3, 4, 5, 6) and no solid reasoning has been found for it during that time. It’s got 2 sides to the coin:Do you consider the money you spend on food to be money that is “thrown away”? What about the money you spend on gas? Electricity? Toilet paper? All of these are things you’d normally buy and just throw away when you’re done with them and get no lasting value from them, right? Well, consider dumping rent money in that same category.Even if you own a home, you still have to “throw away” money on expenses like property taxes and mortgage interest (and likely more than you were throwing away in rent). In fact, for the first five years, you are basically paying all interest on your mortgage. For example, on a 30-year, $250,000 mortgage at 7% interest, your first 60 payments would total about $100,000. Of that you “throw away” about $85,000 on interest payments.

Conclusions

A lot of money myths have to do with “mindsets” and “sayings” that have been passed down over the years from your parents and your parents parents and so on. Right alongside them are the tendencies of people and their actions around money.Yes, everyone has been stung by a bad investment, a sour financial transaction, or a seedy person trying to get their hands on your money. But the key is to not let that dictate how the rest of your life is going to be when dealing with money. It is an experience that you’ve had and you’d be better of to learn from it than you would be to dwell on it. Part 1 can be found HERE.  Part 2 can be found HERE.  Part 3 can be found HERE.photos by: digidreamgrafix.com??103 Per Ola Wiberg (former ponanwi and Powi)Elfboymckaysavage,Ravenellesaschapohflepp,

Filed Under: 401KCompensationCreditCredit CardsDebtEmergency fundfinancial educationFrugalInterviewsInvestingMutual FundsReal EstateRetirementROTH IRATaxesTraditional IRA

  • http://toughmoneylove.com Mr. ToughMoneyLove

    This is a great list. Regarding home as an investment, I would add that a paid-for home provides tax free virtual income in the form of lifetime shelter services. That makes it a great investment if you can own it long enough to pay it off.

    Mr. ToughMoneyLove’s last blog post..Your Best Tactics for Tuesday after Market Mania on Monday

  • http://sensetosave.com Kacie

    This was a fabulous series!

    It bugs me when people just automatically say that their home is an investment. No! It’s a place where you live. It’s not an investment until you sell it and move somewhere else (and that is, if you actually make money on the thing).

    And renting is SOOO much cheaper for us right now. For one, we don’t have any money for a down payment at this point. Two, we don’t have any money for those random home repairs that seem to pop up when you can least afford them. And when I add up our overall rent expenses (rent, insurance, electric bill) I see that it’s at least $500 per month, if not more, than what we’d be spending if we lived in a small, crappy house. No thanks.

    We’ll buy when we can afford it and when we want to.

    Kacie’s last blog post..Adding cauliflower & zucchini to hummus

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  • http://www.mydebtrefinance.com/blog My Debt Refinance

    I’ll save money when I have enough – I have heard this myth a lot. What happen is “enough” never comes. So is better to start right now.

    For this I use a piggybank and everyday I put some money on it. Sometimes I have some change, sometimes some dollars and when I put them there, there’s no return so I save a lot of money that otherwise will go to cheap daily buys.

    My Debt Refinance’s last blog post..What will you be doing with your finances in the next year?

  • http://www.readysetreadreviews.blogspot.com RebekahC

    A wonderful conclusion to your series. I really appreciated your thoughts on the rent vs own situation. I guess I’m not very savy when it comes to math and without someone breaking it down for me, like you’ve done here, I was content to go along with the myth mindset that renting was a waste of money. Since my husband and I are hoping to move within the next year there’s a good chance we’ll end up renting an apartment for a few months after our house sells and we look for a new one in the new town. Before reading your article I was worried that this would be convenient but a waste of money. Now I see that it will actually not be such a stupid decision after all. Thanks again!

    RebekahC
    littleminx at cox dot net
    http://www.readysetreadreviews.blogspot.com

    RebekahC’s last blog post..Baby Animals by Jim Pipe

  • http://www.thepassivedad.com Scott @ The Passive Dad

    With #23 I’ve also heard friends say that they couldn’t get by if it wasn’t for Visa or some credit card. I say Yikes! These same friends buy Starbucks coffee and nice clothes for the kids. Why do they “need” a credit card for those purchases when they carry a balance. Great post.

    Scott @ The Passive Dad’s last blog post..$1500 Reduction In Property Tax. Help Your Friends And Neighbors Save Money

  • http://www.happinessisbetter.com HIB

    I have an issue with #20 although I am biased being a real estate investor :). I know that you mentioned “your” house as an investment. My comment is in regard to real estate in general as an investment, and not from the perspective as a residence.

    I look for property that is priced under the value of the home. Typically, investors look for property that is at 70% of the after repaired value (ARV) minus repairs. Taking this knowledge and applying it to buying property and holding as a rental in this fashion is a prudent decision in my humble opinion. A house is a great investment as a rental property if the property is purchased taking into account, the above considerations. A house that you live in is an expense. If an object does not bring in cash flow, it’s an expense.

    HIB’s last blog post..Can You Say Success?

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  • Kjordan3637

    Here is a “myth” so to speak… how much does it cost to raise a child?? Take a look at our latest blog post which includes a cool graphic from Visual Economics.

    http://www.precisiontradingsolutions….

  • http://spartantraderfx.org/ spartan

    Unfortunately mindsets and sayings that things built over time so it's not easy to get rid of them. We are not logical all the time and get affected by many of these myths.

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  • ladycity

    トリーバーチは元々バレーシューズから始まったのですが

    そもそもバレーシューズとはバレリーナが利用するシューズのことです。

    それを街で履けるようにソールを付けて履きやすくしたものなのですが

    現在はファッションアイテムとして定着しています。

    ヒールに疲れた女性にとってバレーシューズはまさに画期的とも言うべき快適さで瞬く間に広がりました。

    また、マタニティシューズとしても安心して履けるので、妊婦さんにも人気があります。

    素材と使用感

    tory burchのこのバレーシューズは、素材が本革なのですが

    本革は本革でもこちらは丈夫なナッパレザーというもので仔牛の革を使用したなめしのレザーなのです。

    揉み加工が施してあるためとてもしなやかで柔らかく且つコシのある革になっています。

    なのでスッと肌になじむ心地良さがありそして、足が覆われる部分は優しく包み込んでくれるので足へのフィット感が最高な上にソール部分はラバーなので弾力性があります。

    1番始めに履いたときは若干きつい感じがあるのですが

    数回履くとすぐに馴染み、自分の足にフィットしてきてとても履き心地が良く一度履くと病みつきになってしまうのです。

    しかもさすがバレエシューズなだけのことはあり弾力性があるので運動靴のようにジャンプする事もできる革靴なのです。

    トリーバーチ 靴 のバレーシューズ、トリーバーチ シューズ REVAシリーズは運動靴感覚で

    ずっと履いてても全然疲れないというこだわりの材質、作り、最高の使用感が

    人気の走りであることは間違いないでしょう。

    現在はラバーやエナメルなど数々の素材のシューズもあり

    丈夫で軽いバッグ、機能性に優れた財布など他のアイテムも充実し

    エナメル素材やゴールド・シルバーなどのシャイニー素材等多くの種類の素材が使われています。

     

     
     

  • ladycity

    [url=http://www.lady-city.com]tory
    burch トリーバーチ靴[/url]のを 履いた感じの感想・・・

    靴のフィット感・感じ方には、好みもあったりで かなり個人差があると思いますが、私のサイズ選びのポイントを感想もまじえて。どうぞ、[url=http://www.lady-city.com]トリーバーチ 靴[/url] のサイズで迷ってる方は、参考にして下さいね

    リーバは、フラットなぺたんこ靴なので、高いヒールのように足が前にきちゃって痛いなんていう心配のない楽ちん靴ですが、

    バレエシューズ型リーバには3つの特徴点があります。 

    ①欧米人向けに作られているので標準的な日本人の足からみたら細身

    ②つま先・トゥの部分が見た目通り 少し細くなっていますので、キツいと指の付け根あたりが押されて痛くなると聞いています。

    ③バレエシューズは、とにかくアッパーもフラット。甲高の足の場合は最初、甲の部分が圧迫される場合があります。甲が高い足だと、アッパーを押し上 げている分、「かかとのゴム部分」や「足の前側(親指側とか小指側とか足の特徴によって違うそうですが」あたりが圧迫されて痛くなるんだそう。

    私の場合、私の足は23.5cm。幅(ワイズ)は標準。[url=http://www.lady-city.com]tory
    burch[/url]のバレエシューズ型リーバはUS表記6.5で良い感じ。US表記6 だと履けない事はないですが、指先が押されているっていう言う感じでした。

    履き始めは、後ろのゴムの所が少し当たって擦れる感じで戸惑いましたが、数日で解消しました。その後はかなり調子が良いです。

    -サイズ選びのアドバイス-ちょっと幅広かも、甲高かな・・・という方はハーフサイズアップしてみると良いそうですよ♪(ハワイの[url=http://www.lady-city.com]トリーバーチ[/url]の店員さんがアドバイスしてくれました。)

    また、革は履く事によって足の形にあわせて伸びていきます。履いて行くうちに足にあってくる場合もほとんどですよ!でも、「どうしても靴があわなくて足が痛い」という場合は、靴専門店がやっているのと同じ方法で靴の革を伸ばす・柔らかくするという方法もありますので、あきらめないで下さいね。

    [url=http://www.lady-city.com]トリーバーチ[/url]・リーバ エナメル パテントレザーのブラック