Myths of personal finance: Decapacitated

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Education is a formal right, but what education lacks today is the financial aspect of education. There are lots of conspiracy theories regarding the school system and education policies around the world. Some say they were created to produce Staffs who will Ultimately, be working for the higher orders and will be the prime source of taxation for different governments in the country. financial intelligence and education are widely unaccepted. They’re possibly hated for the ingrown complexity that follows. Not only that, our forefathers and fathers have not been introduced to financial education and intelligence. They had to figure it all out by themselves and that is why they do not have that interest. 

Every time you ask anybody from generation X, they will say money won’t buy you happiness. And they will advise you to have a job and figure it out as they did. But the problem with this is many people believe in financial myths that forbid them from taking the right decision at the right time. You need to understand that your money will not go into savings unless you find a way to make it work. The inflation rates are growing up. And the fixed deposits are not very good for this situation. Here are some financial meds which need to go now.

You need to own riches for Investment

Most people say that investment is for the rich and they’re not rich, so why bother to invest? Save some money and live your life by compromising on every point. But no investment is the source of life in the future. If you do not invest now, your money will be diminished. The general cloud notion is to put your money into a fixed deposit and then let it grow over time. But the truth is, every time you put your money in a fixed deposit, you are bounding yourself with poverty because the inflation rate rises almost 6% per annum and any fixed deposit doesn’t give you more than 5%. So why will you put your money into a fixed deposit? Rather invest through SAP mutual funds?

Not having an emergency fund

As a person, you should prioritize having an emergency fund ready because you never know when the disaster can strike. Investments such as insurance and life policies. Medical policies are the best way to improve your emergency. Do not rely on credit or debit cards because you won’t be able to pay them with credit or debit cards.

Demonizing the loan process

This is the biggest example of not having financial independence and intelligence. You need to understand that you can’t make money without borrowing money if you are not very good at your financial management, you won’t ever figure out how to borrow money and how to pay it back. That is why most Indians fear loans. If you know how the loan is settled, and if you know the limit to which you can take loans and the process to pay it back, you will be able to procure whatever you want in the way however you want. So do not fear the loan. Understand how to repay it and understand the process.

Credit cards are just another form of a loan

Just like loans, people also demonize credit cards. Because they believe that if you have money, why will you borrow? But understanding the process of borrowing and repayment, and the benefits related. You will be tempted to a credit card immediately. A credit card is a big pool to build whatever you want in a way that you have never imagined. Suppose that you are spending someone else’s money while you are saving your money in your account and earning interest from it. If you’re really smart in your approach, you can even earn from your credit card to some extent. Understand the limits of your credit card and the spending values. Have control over your temptation and spend and spend everything on a single credit card and pay back after the month in full. That is how you use a credit card to its full potential. And in a reward, you not only get a better credit score but a financial intelligent system at your point.

Buying houses is the best possible investment

Many people think that real estate is the best investment after gold. Possibly it is, but for bigger purposes. If you’re buying a house just to resell it after some time you’re creating a big mess for yourself. You need to understand that real estate rates are going almost at 5% per annum and that is as bad as having a fixed deposit at your hand. Rather, use intelligence for your financial decisions and understand investments. Make good investments and decisions and reap the benefits throughout your life.

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