Home Money Four Money Myths That Keep You Poor or In Debt

Four Money Myths That Keep You Poor or In Debt

by Chris Poindexter

Even the smartest people among us sometimes fall for myths and fables. Sometimes those myths come in the form of cute sayings that are handed down from generation to generation, other times they are simply plausible untruths that gain traction in popular culture. As an example think about the number of people who believe that roosters only crow in the morning. Anyone raising chickens can tell you they crow all day long. Or that by tapping the top of a can of soda you can keep it from fizzing over if it’s been shaken up. That is a myth and, since it’s summer, you can go outside and run your own tests to prove that it really doesn’t work.

Myths, fables and truisms are mostly harmless, until it comes to your financial life. In that context myths can keep you in debt, can rob your savings and leave you struggling for the basics for years. These four encompass the myths that keep people poor and in debt.

Money Can Solve Your Problems

Back in the day when I was poor and in debt, I used to imagine that getting a sudden infusion of cash would solve all my problems. That myth meets the reality that, according to StatisticBrain, nearly half of lottery winners burn through their winnings within five years. If you don’t know how to handle money, if you don’t have financial success systems in place in your life already, getting more money will not fix your financial problems. The bad habits that keep you poor will continue to keep you poor, no matter how much money you have. That is the cruelest truth in money management; if you’re poor at managing a little, you will be equally poor at managing a lot.

You Might As Well Splurge

No matter what you do, you never seem to get ahead, so why not splurge? It’s the financial equivalent of a heavy person sabotaging their diet with a tub of ice cream. The reason you don’t stick to a budget is the same reason people don’t stick to a diet; you haven’t changed your old habits. Losing weight means changing your diet and exercise routine, essentially forever. It’s the same in your financial life. Being healthy financially means practicing being frugal and sticking with prudent money management practices your entire life. There is no magic formula for riches, it’s just a long, tough road.

You’re Not a Genius Investor

You don’t think you’re smart enough to invest, so why risk it? Instead of putting your money to work in solid growth industries, instead of earning interest and dividends, you leave your money in savings and money market funds. To borrow a line from Robert Kiyosaki, savers are losers and he’s exactly right. Fewer than half of all Americans have money in the stock market, which is collective insanity. Only half the country is reaping the rewards of being invested in one of the most dynamic and innovative markets on the planet. That fact is astounding to me.

Other People Get All The Breaks

The battle cry of the defeatist and poor. Those rich people get all the breaks, you have to have a degree from a high-powered university to get anywhere…waa, waa, waa. It gets nauseating after a while. The United States, for all its faults, is still a land of near boundless opportunity. There are so many honest ways to make money, that the hard part is figuring out which one works for you. Yes, certainly there will be obstacles. That’s just life and, for those who can suck it up and learn how to manage money and how to make money in business, they will never hurt for a job or for opportunities.

Stop complaining about the breaks other people get, stop complaining about what you don’t have and stop thinking that if you only had more money everything would be better. Start taking stock of what skills you have to work with and what you enjoy doing. Then start figuring out how to make money off of those interests and skills with the tools you have at your disposal. If you think I’m making it sound easy, that’s because it is. Get out there and start working on a plan.

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