From retirement to saving to paying off debt, our modern-day money worries are many. But some of that concern is fueled more by rumor than reality.
Mechel Glass, vice president of community outreach for financial counseling service CredAbility, shares the top five money myths she has encountered while working with a range of clients on financial education.
Myth 1: Most financial goals are unattainable. “People may sit down and set their goals, but they don’t track their progress,” Glass said. “They will say, ‘I’m getting out of debt this year,’ but they don’t look at where they are each month. They don’t put themselves on a plan.” In order to successfully reach your goals, you need a plan to get there and a method for tracking your progress.
Myth 2: It is impossible to have enough money for retirement. “It is possible, if we start when we are in our 20s and 30s and just start saving a little bit,” she said. If someone tells you when you are younger to put just a little bit of money aside, the task isn’t so overwhelming. “When you are in your 60s, it does seem unattainable because you’ve waited so long,” Glass said.
Myth 3: Children don’t need to learn about money until they reach high school or college. “You don’t want (children) to get their opinions about how to handle money from other people,” Glass said. “My daughter is 9 years old, and we started talking about money when she was 3 years old. People want to wait until their kids are in college, and by then they are too late.”
Myth 4: Living on a budget means not having fun. “Fun is allowed,” Glass said. You just have to plan for it. Glass set the personal goal of getting out of debt this year — including her mortgage — but was still able to negotiate an affordable rate on tae kwan do classes to take with her daughter. “It is something we planned for and researched and it fit into our budget,” Glass said. Other people may want to go shopping and they still can, she said, as long as they set aside money for each purchase. “You can’t take your whole paycheck and go blow it,” Glass said.
Myth 5: Marriage will end your money woes. “People get married and assume they are going to get a house, a car and go on vacations,” Glass said. “Sometimes when you get married, your partner may have a lot of debt.” Loved ones will often share their dreams and aspirations, but not their financial plans, and sometimes they may even hide their financial past, she said.