Over the past two weeks, our blog posts have focused on creating an abundance mindset and eliminating a scarcity mentality. You can think of that content as the foundation for what comes next – #MoneyMonth! I will explain more about that shortly. But for now, I want to address your money beliefs.
Common Money Beliefs That Are Not True
It’s not the things you don’t know but rather the incorrect things you believe that cause real challenges in life. A few errors in your thinking can be a detriment to your finances. So, steer clear of money myths. And enhance your understanding of money and personal finances. That’s an effective way to get on the path to prosperity.
Avoid these money myths:
- Income equals wealth. People that make more tend to spend more. That is the reason lottery winners are notorious for losing everything. And many families who earn over $1 million annually manage to outspend their income. You can have a very high income and still live paycheck to paycheck.
- Wealth is what remains after you finish spending. The more money you invest in appreciating and income-producing assets, the more you can expect your wealth to grow. A high income provides opportunity. However, it does not guarantee wealth.
- More money equals more happiness / Money has nothing to do with happiness. Studies have shown that more income will make you happier only to a point. The break-even mark was said to be $75,000 per year. But a new study concluded that there are increased feelings of well-being over $75,000 per year.
- The bottom line is this. Although there is a strong link between income, life satisfaction, and emotional well-being, you do not have to make a lot of money to be happy.
“Money can’t buy you happiness, but it can buy you comfort, entertainment, and stability, which makes finding happiness much easier.”
- Wills are for rich people. Everyone with children or assets needs a will. Do you want the courts to decide who will raise your children? Or how to distribute your assets? If your answer is no, then make a will.
- Owning is better than renting. From a financial viewpoint, it depends. Mortgage interest is deductible, but it’s still a significant expense. Homeownership also includes property taxes and maintenance. However, the upside is the potential for appreciation and a place to call your own. Crunch the numbers and decide for yourself.
- Renting is generally advantageous in the short term.
- Quality and price go hand-in-hand. That is not always true. For example, generic drugs are identical to the brand-name version and cost much less. Companies price goods and services to maximize profit. That means the perceived value affects pricing, not the actual value.
- You should never have a credit card. Credit cards are a wonderful invention – if used properly. However, credit cards also provide a means to spend money you don’t have. That can be a challenge or a godsend, depending on the circumstances. Credit cards can also help (or damage) your credit.
Are your erroneous beliefs limiting your financial growth? First, consider all your money beliefs, then question if they might be incorrect. Having accurate perceptions enhances decision-making and results. Therefore, it is essential to avoid buying into the myths.
Now back to the topic of #MoneyMonth. August is Money Month at Ascentim. And we couldn’t be more exhilarated!
Each week, as a part of our Money Month series, we’ll share topics designed to help you use your abundance mindset to create the financial future you desire.
The topics include:
- Why You May Want to Be Wealthy – Wealth is about more than having money. Learn the reasons why it is beneficial to build wealth.
- Money Habits That Can Keep You Poor – Our money habits can make or break us. Discover common behaviors that keep us poor.
- Money Strategies Than Will Make You Rich – Regardless of your current situation, there are strategies to improve your financial future.
- What Lifestyle Creep is and How to Avoid It – Is your spending hindering your ability to achieve your financial goals? If so, you may be experiencing lifestyle creep.
- The Power of Giving – There are many benefits of giving. Not the least of which is science shows that giving makes us happier.
We’ll also introduce you to our G.R.O.W. Finances course, designed to show you how to:
- Get out of debt
- Retain more of your income
- Organize and protect your assets
- Walk in wealth
August is sure to be a lucrative and exciting month. Stay tuned!