Guest Post by Money Hacking Mama
There are many conventional assumptions about money that people may hear and believe are true. However, if you challenge these conventional assumptions you’ll probably find yourself much happier.
Here are some examples of assumptions about money that society has taught us to believe. I’ll also share how you can think differently and challenge them. Once you push past these assumptions, you will find that the path towards financial independence may be much easier than you realized!
Assumption About Money #1: I have to work hard to get money
Reality: Hard work is helpful. However, at the end of the day, the people that work smart make the most money.
Why?
Because they can be more efficient and get more done. It’s also important to work at the right things. If you’re working hard and not smart you may look busy but aren’t making any progress towards the things that matter. So, next time you feel overwhelmed and underpaid ask yourself “how can I work smarter?”
Some passive income ideas –
Assumption About Money # 2: I work hard, I deserve X
Reality: At the end of the day, purchasing decisions have nothing to do with how hard you work or whether or not you feel you deserve something. The only thing that should relate to a purchase decision is whether or not you can afford it.
This assumption about money is so prevalent in our consumeristic society today. Marketers have done a great job telling us that we deserve the newest upgrade to our current stuff.
So, next time you feel as though you deserve something, question yourself and instead ask how much you can actually afford. Not sure how to determine what you can afford? Start with a budget.
Related: 7 Things to Stop Paying For Today
Assumption About Money #3: I have to work until I’m 65
Reality: You can retire at any age with the right financial strategy.
This is a huge one because 65-years-old is around the time when the government says we should retire. However, this is based on a lifetime of putting money aside in social security. You can retire whenever you want if you simply put larger percentages of money aside for retirement, or find alternative ways to generate income.
If you are interested in learning more about retiring early check out these resources.
What is Financial Independence?
Starting the Journey Towards Financial Independence
Assumption About Money #4: Education is Expensive
Reality: Education doesn’t have to be expensive, especially in this day and age.
For example, the internet and libraries are full of free information! Formal education can be expensive, however, it is possible to get full-ride scholarships, tuition remission from employers, grants, aid, and external scholarships.
Education can be expensive but it doesn’t have to be if you’re willing to challenge your assumptions and think differently.
Related: 6 Ways to Get a Free Education
Assumption About Money #5: It’s Rude to Discuss Money
Reality: The only way to get good with money is to talk about it.
How can people learn about money if it’s not discussed? If you ask me, I think not talking about money is etiquette that business owners impressed upon their employee’s hundreds of years ago to keep them oppressed. Start discussing money!
If you don’t feel comfortable use companies like Payscale or Glassdoor to check how competitive your wages are. You don’t need to discuss money with everyone or even with people you know. There are plenty of free and anonymous forums online (like on Reddit) where you can discuss money and learn a lot of valuable information.
You can learn how to invest money, make better purchases, or even how to save money for retirement by discussing money with others.
We have so many conventional assumptions about money because we are not talking about money! We tend to follow along with what society tells us rather than questioning it.
Related: How to Build a Financially Strong Marriage
Assumption About Money #6: Cash is King
Reality: Credit cards can be better than cash.
Do you ever notice how quickly cash disappears without you having a clue where it went!? That happens to me all the time. Cash is great but I believe it belongs in a bank making money. Credit cards, when used the right way, can be even better. Here’s why:
- Rewards credit cards provide you with points effectively giving you a discount everywhere you shop.
- Credit card help you keep track of your spending
- They protect you from fraud and theft because you can challenge expenses that you didn’t charge, and they’ll even detect when something fishy is happening before you notice it.
- They help you build credit so you have more access to capital when you need it (especially helpful if you’re planning on investing in real estate or starting a business).
- Many credit cards offer additional benefits such as travel insurance, discounted travel, etc.
**Disclaimer: If you are someone who carries a balance on your credit card each month, then stick with cash or debit cards. Credit cards ARE NOT helpful when you are paying interest on the money you are spending.**
Assumption About Money #7: Money is the Root of All Evil
Reality: Money is just a tool that can be helpful or harmful depending on how it’s used.
1 Timothy 6:10: For the love of money is the root of all evil
People tend to get confused and say money is evil. When really it is the LOVE of money that is the root of all evil. While greedy actions are bad, money cannot be good or bad because it’s simply a tool.
For example, a hammer can be used to hurt someone (hurtful) but it can also be used to build a home (helpful). Money can be quite positive and helpful. As long as people understand how to use money in positive ways that don’t harm others and keep themselves from being greedy.
Related: How to Honor God With Our Money
Assumption About Money #8: More Money, More Problems
Reality: More money, different problems.
When you’re broke you may have problems like figuring out how to pay for things. When you have more money those problems go away because you have the money to afford to buy what you want when you want.
However, you’ll acquire new problems. Problems like ‘how do you protect the money you have’, or ‘how do you decide who should get your wealth when you’re gone’. The problems don’t go away, you just get different problems. The great news is that if you have money you can afford to hire smart people to help you out which actually makes your problems easier to deal with.
Another problem you can have with money is becoming greedy with it. Just as mentioned before, the love of money is the root of all evil.
Assumption About Money #9: Budgets are Restrictive
Reality: Budgets are freeing!
Most people assume budgets keep them from spending money and living the life they want. In reality, however, budgets help you get to the life you want so that you can have more freedom in your life.
For example, a budget can provide you with the freedom to go on a dream vacation or even stop working at a young age. Curious how this is possible? Check out how I’ve saved over $500,000 so I can retire early and how you can too with these simple budgeting steps.
Are there any other assumptions about money that you can think of?
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