The best feeling in the world is when you become independent and start earning a reasonable stipend. With this, everyone Need to fulfill all wishes, like dream vacay, shopping checklist, and other things.
And at the end of the day, everyone needs to do savings, but the other thing that hits an individual is that they have to invest somewhere if they earned
Different people give different advice, and at times we follow what they tell us. But one should think practically considering all the aspects to that particular thing. So, there are some personal myths related to finance that need to be busted for sure.
Myth: Savings = Money should be kept in the savings account.
People said with Damm confidence that they kept their money in saving bank account and in the form of FDs. Because according to them, that was the safest place where all their savings were safe.
Reality:
As we put the money in our savings bank account, we thought we were saving the money. But in reality, when it comes to expenses, it’s human nature we are going to spend only that money which is readily available, and saving accounts is the first place from where we get the money. For example, with the FD rate around 5% and consumer inflation is being about 6%, we are eroding our purchasing power.
Thus, it is vital to go beyond the savings account and invest the money as a portfolio – of different asset classes that align with your goals and needs.
Myth: Individuals need a lot of money to invest.
I can invest one lakh rupees if I get some opportunity.
Reality:
So, how much have you filled in the blank?
INR 100
INR 1,000
INR 10,000
INR 10,00,000
And the list goes on increasing, but people can never invest. Many people have many misconceptions related to investment and related stuff. Sometimes, even small investments can make you successful or you being benefitted. And, one should personally do financial management as part of their life outlook.
Myth: Risks are always risky, It’s only savings.
Human beings believe that investments are risky, and one can lose all their money.
Reality:
Humankind tended to be afraid of uncertain things. Investments were one such thing. We regularly read that someone invested in some company and closed or lost all their company shares in newspapers.
It is correctly said that if we have to see some good results in terms of finance, we have to invest or take the risk as some actors like Amitabh Bachan invested in cryptocurrency. One-time investment can also do wonders.
The stock market is not the only way to invest; there are other ways also. Proper guidance is necessary before taking any significant step towards this. A mentor can help us in planning things in a better way.
Myth: You need a budget.
It is a big myth that you always need a budget for financial management.
Reality:
If someone can make a budget, then it is not necessary that one can save money. A budget can be helpful if proposed adequately. But far more important than a budget is spending and saving your money wisely.
Many people do this without knowing how much they spend at Starbucks (I’m at Starbucks enjoying a Mocha while I type this!).
