Money Myths

Let's debunk some of the money myths you and I were taught growing up. Out of all of the bad advice I was given, these 2 made it to the top.  

ALL DEBT IS BAD! 

This is one piece of advice that always made me question finances and money in general. I used a bank, aka debt, to buy my first investment property. 

The bank funded the deal with a loan. The tenants pay off that loan each month with a little profit left over. 

And eventually, the property will be paid off, and if I keep the property, I can continue to make a monthly income. 

This is what many investors consider good debt. 

Now, if the tenants don’t pay rent, I have to pay the loan, and for a brief period of time, it could turn into bad debt. 

Robert Kiyosaki put it like this, “If it puts money in your pocket, it’s an asset. If it takes money out of your pocket, it’s a liability.” 

Those expensive cars you drive may be a liability if all you do is make payments and it shows no return. 

Look at your life and ask what's good debt and bad debt.

YOUNG PEOPLE DON’T NEED TO WORRY ABOUT INVESTING! 

All I can say about this is that I wish my parents had taught me about investing and money at a young age. 

Honestly, I grew up in a household where you didn’t talk about your money; I was told money is the root of all evil, I was told wealthy people got that way by screwing people over, etc. 

In my 20s, I heard this phrase from Jim Rohn, “For some people, there is too much month at the end of the money." 

Read that again! 

Basically, he was saying that most people run out of money before the month is over. 

Many people live paycheck to paycheck, and for some people, their paycheck is gone before they ever even get it.

At some point in their lives, they signed up for payment plans, money for a car, money for a house, money for the next thing and the next, and the next. Their money's gone before they ever even get it.

This goes back to my original statement; I wish my parents had taught me about investing. As time went on in my early career, I learned what it meant to have an asset. 

Long story short, If I wanted a car, I would buy an asset to pay for that car. 

A lesson learned from the great man Robert Kiyosaki, buy an asset that pays you XYZ every month and use that money to buy whatever you want.

Once the debt is paid off, you still have that asset providing you with a monthly income. If you haven’t read Rich Dad Poor Dad, I highly recommend it.

It outlines a fantastic way to view money and what it's like to invest. Investing isn’t just buying stock, real estate, or putting money into an IRA.

Teaching the younger generation about money, investing, assets, liability, etc., can help educate them.

As a parent, this is all I want for my kids, to educate them and give them opportunities I didn’t have as a youngster.

It’s never too late to learn about investing, and you’re never too young, either.