Talking about some money matters can be very scary. It’s even more frightening when those money matters are filled with myths. Don’t let these scary money myths keep you from discussing, addressing and improving your financial situation.
MYTH #1: I HAVE TIME TO PLAN MY FINANCIAL FUTURE!
Time flies, not only when you’re having fun, but in general too and cannot be replaced, replenished or restored. Most people, especially when they are younger, believe that they have enough time and can wait on planning for retirement. Unfortunately, the importance of future financial planning (retirement planning) is sometimes realized after several precious years of savings and earning compound interest have been lost. The scariest part about late retirement planning is that there may not be time or disposable income to save up enough money at the desired retirement age, which means working longer. Instead of retiring at age 62, you may have to entertain working until age 70 or older. SCARY!
To ensure that Time is on your side, be sure to Save Something Sooner and maximize the time you have.
MYTH #2: I’M TOO OLD TO GET STARTED
It gets easier to fall for the fear factor of “getting started” when get more mature in age. Whether it is starting a business, creating a spending plan, or going back to school to get your degree; it’s never too late to start. Yes, it is scary and may be completely out of your comfort zone, but it will be totally worth it.
So, “Do It Scared!!!” – Tarra Jackson
Just remember that doing it scared doesn’t mean you have to do it alone. Connect with entrepreneurs, mentors, or professionals to help you through the process. Just get started.
MYTH #3: MORE MONEY LESS PROBLEMS
It is easy to believe that more money will solve money problems. However, the rapper Biggie Smalls said it best, Sometimes …
“More Money More Problems.”
Adding more money to a financial fiasco may just magnify the money massacre. Often it is not about how much we make; rather it is about how much we spend.
So, before wishing upon a star for more money, make sure you monitor your spending behaviors and create or modify your budget to avoid creepy cash flow issues.
MYTH #4: I CAN’T AFFORD LIFE INSURANCE
One of the scariest myths is that life insurance is too expensive. In most cases, this scary story is a fallacy that keeps people from protecting their family from financial fright during the most difficult time of their life.
For example, a $250,000 10 year term life insurance policy for a healthy 30-year-old male could cost about $160 a year or about $13 a month. But, one in four people polled in that study thought it would cost more than $1,000 a year. The cost of life insurance is mainly based on a person’s age, gender, health and possibly other factors like driving record. The younger and healthier the person is, the cheaper the cost of life insurance.
Even though one size does not fit all when it comes to the cost of life insurance, connect with a licensed life insurance agent to learn how affordable it is for you or your loved ones.
MYTH #5: BUYING NEW IS BETTER
Of course the Bling of buying New is Beautiful, but it doesn’t always mean it is Better. Especially when it relates to purchasing a car.
“On average, a new car will lose as much as 19 percent of its value in its first year of ownership. That means that your $20,000 new car will be worth about $16,200 after just one year,” reports Trustedchoice.com.
The rate of depreciation, however, does not continue at this rate after year one; it actually slows down. Therefore, a used car value may be more or at least closer to it’s cost.
Instead of buying new when car shopping, consider buying pre-owned (used) with a warranty and low mileage to avoid the possible doomed depreciation of buying new.