Now that Millennials are hitting their stride in the workforce, personal finance has become a popular and rapidly evolving topic. Influencers on YouTube, TikTok, and Instagram are paving the way for younger generations to manage their wealth. Regardless, there are still quite a few financial myths floating around.
Curious if you’ve been following some of the most common financial myths? Read learn what the myths are and what you should be doing instead!
You Can Wait to Save for Retirement
Most people graduate college when they’re around 22 years old. When you have your whole career ahead of you, it’s easy to put off saving for retirement because it seems so far away. For that reason, many people believe that they don’t have to start saving for retirement until they’re in their 40s.
The truth is, however, that you should start saving for retirement as soon as you start working. The sooner you start putting money away, the more work it can do for you. Even a five-year delay can cost you hundreds of thousands of dollars when it comes to retirement.
You don’t have to be aggressive, but you should aim to put a healthy amount of money throughout the entirety of your career.
Don’t Bother With a Savings Account
Years ago, savings accounts came with generous interest rates. Today, however, they leave a lot to be desired. For this reason, many people believe that a savings account is no longer worth the hassle that comes with opening it.
The truth is, savings accounts are still an incredibly valuable part of any healthy financial portfolio. The primary reason for this is the fact that you need to have money that you can access quickly in the event that you have a financial emergency. Secondly, while interest rates aren’t great, savings accounts still help you accrue more money over time.
If you’re thinking of opening a savings account, consider opening one with a reputable online bank like Ally or Comenity. These banks tend to have significantly higher interest rates than traditional banks.
Buying is Better Than Renting
Many people view buying a home as the ultimate financial goal, and they see renting as throwing money away. The truth is, the situation is a lot more nuanced than that.
Depending on how long you’re planning on staying in one particular location, it can be far more advantageous to lease a place. People who only plan on staying one or two years far much better renting. On top of that, renting saves you the frustration of having to deal with costly home repairs.
Owning a home does come with its advantages, like home-equity lines of credit if you’re in a bind. Take the home payoff HELOC savings quiz to see if you’re in the right place for it.
Don’t Let These Financial Myths Fool You!
There are so many financial myths out there tricking otherwise financially savvy people into making the wrong moves with their money. Thankfully, you don’t need to be a financial industry expert to make power moves with your money. Staying on top of the latest tips and trends will help you create the most effective financial strategy for your needs.
If you’re looking for a resource that’ll help you do just that, then you’ve landed in the right place! Check out the rest of our blog for tons of tips about everything from personal finance to health and fitness!