Business & Finance

Common Myths About Financial Freedom

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Common Myths About Financial Freedom

Money is a very sensitive subject surrounded by controversy, greed, fear and a ton of myths. The challenge is that some myths are false while some may sound believable and even reasonable. Most times, people utter statements such as, “I want to be free financially, so I won’t have to think about money in my old age.” With this, financial freedom has really made a name for itself.

Financial freedom is believed to be the solution to all problems. However, it is an illusion because even if you think you are financially free today, you might not be free 3 months or 2 years from now. So, being financially free is not defined by your income, how much money you make or how much you have saved. Everyone has their definition of financial freedom.

Today, we will be debunking some myths about financial freedom.

Myth #1: You can save your way to wealth

There are so many lapses in this myth and it is surprising that people still believe it. First, the amount you save depends heavily on factors like your income, cost of living and tax laws in your state. So, it might not be easy to save 50% of your income if you are just above the poverty line. The solution is to create a saving plan based on your situation. Of course, you can invest too.

Myth #2: Financial freedom means avoiding debt entirely

Being debt-free is a good goal to achieve. Unfortunately, it is not a rule to building up an overall financial long-term strength.

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Debt is not all bad. Sometimes, it can get you on a fast track to financial independence. So, it is good to learn how to leverage your financial tool because it will amplify whatever situation you are in. For example, education debt can equip you with the knowledge to thrive in the world and business debt can bring in more money than it costs.

Myth #3: You need own a home to be free financially

This myth is not true for everyone. Of course, owning your home has its advantages because you tend to live rent-free on an asset that is continuously growing in value. Also, owning a home brings pride and fulfilment, but being a homeowner is not for everyone.

Myth #4: Money comes to those who wait

This is not synonymous to the saying, “the patience dog eats the fattest bone.” This myth will keep you lazy and unmotivated.  Of course, some good things require patience like healing from emotional wounds. You should note that money waits for those who come. So, you need to be proactive about making money as well as finding lucrative investment.

Now that we have explained some common myths about financial freedom, you should aim for financial confidence. This is because financial confidence is the skill and the ability to make money anytime and anywhere you want which will help you to deliver value to the marketplace.

Read Also: 3 Easy Steps to Create a Budget

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