There are many reasons people aren’t financially successful, but one of the most common yet less talked about ones are the myths and misguided beliefs people have about money.
What are they? What are the facts?
Christa Mathews, author of the book “How Money Works for The Next Generation,” and a Certified Financial Educator, talks about different money myths that people think are true but aren’t.
“Renting is throwing money away.”
Not true. Renting can be a smart move depending on your lifestyle, goals and market conditions. You’re paying for flexibility, no maintenance costs and sometimes cheaper monthly expenses. Renting can allow you to live in high-demand areas without the massive price tag of ownership. Owning a home isn’t always the best investment, especially if you move often.
“You need a lot of money to start investing.”
Investing isn’t about how much you have. It’s about how early you start. Time is your secret weapon. Thanks to compound interest, the earlier you invest, the more time your money has to grow. The best part is you don’t need thousands to start investing. You can actually start with the cost of your morning coffee.
“Credit cards are bad.”
Credit cards aren’t the enemy. Debt is the real problem. If you carry a balance month-to-month, interest charges can pile up fast and snowball into debt. That’s what hurts your finances, not the card, but the habits. Paying on time and keeping your balance low helps build a strong credit history, which impacts everything from your ability to rent an apartment to qualifying for a mortgage or even getting a job.
“All debt is bad.”
There’s a huge difference between high-interest debt that drains your finances and strategic debt that helps you grow. For example, a high-interest credit card could be considered “bad debt” because it can trap you in a cycle of payments. But “good debt” like a mortgage or student loan can be an investment in your future. If it helps you own a home or earn more money, it’s working for you. The key is managing it responsibly and not borrowing more than you can repay.
“I’ll start saving when I make more money.”
The best time to start saving was yesterday. The second-best time is right now. Unfortunately, if you don’t control your money now, it’ll control you later, no matter how much you make. Lifestyle inflation is real. If you don’t build the habit now, you’re unlikely to suddenly start saving just because you earn more.
“You have to be rich to work with a financial advisor.”
You don’t need six figures in the bank to get help with your finances. In fact, getting advice early before you build wealth can set you up to actually achieve it. More and more advisors now work with people at every stage of life. Think of it like hiring a trainer for your financial fitness. You don’t need to be in shape to start. You just need the will to improve.
“You don’t need an emergency fund if you have a credit card.”
You can’t swipe your way out of a financial crisis. Relying on credit in emergencies often turns short-term problems into long-term debt. Saving now means you avoid borrowing later.
“Money equals happiness.”
Money can buy comfort, but happiness is personal. Money can absolutely reduce stress and create stability, but what brings happiness varies from person to person. For some it means early retirement. Others want time with their kids. The key is knowing what matters to you.
“Investing is the same as gambling.”
This is a big myth. Gamblers bet on outcomes they can’t control, hoping for a lucky break. It’s all about quick wins, fast returns, and high stakes, often followed by high losses. Investors, on the other hand, think long-term. They set clear financial goals, like buying a home, sending kids to college or retiring comfortably. Their approach is rooted in strategy, patience, and discipline, not gut feelings or blind hope.
“If I make more, I’ll automatically be financially secure.”
If you don’t know how to budget, save, or invest when you’re making $40K, earning $140K won’t magically change that. Bad money habits tend to scale with your income. There are millionaires who go broke and people with modest incomes who build real wealth through budgeting and smart choices. High income is helpful but financial education is what turns income into freedom.
