Money myths that hinder financial success

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MUNMUN NATH

Part 1
Last month, we asked followers of our Facebook page to share common money myths that they felt Filipinos believed in. We received an overwhelming response—proof that perhaps those money myths are common among Filipinos. We reviewed all the replies and compiled them into a two-part article that will give you insights into the truth behind those myths. The first part presents the following three money myths most Filipinos believe in, according to our followers:

Myth No. 1: Cold cash is always better than a credit card.

The consumer pool is split into two stubborn groups: Team Cash and Team Credit Card. Of the two, the former seems to be more set in its belief that a credit card is a spendthrift’s ticket to a life of financial ruin and bankruptcy. In all fairness, the logic used by Team Cash is impeccably sound—without a credit card, you’ll be less likely to spend more than you can manage. A credit card is a ticking bomb for big spenders and prodigal consumers, but at the hands of a responsible person, it can present wonderful benefits.

Myth No. 2: The higher your educational attainment is, the better off you’ll be financially.

Pinoys know that there isn’t always a solid causation between education and wealth. Sure, there is a strong correlation—after all, a jobseeker with a master’s degree is more likely to find a high-paying job than a mere high school graduate—but that’s all there is to it. We have heard of many instances when Pinoys who have less impressive educational backgrounds fared better than their more educated counterparts. We see this especially in the Overseas Filipino Workers (OFW) scene, where non-degree-holder Pinoys fly abroad to take menial jobs and then come back to their mansions in the Philippines. It’s a familiar story that many of us see every day.

Maybe this lack of causation between education and wealth in the Philippines is due to a unique culprit: the Filipino trait of “diskarte.” Loosely translated, it means, “strategic thinking,” although the phrase barely captures the essence of the word. People who are madiskarte can make good of any situation. Instead of whining about how hard life can get, they strive to think out of the box and do things others won’t. They believe their diplomas can only take them so far—that it’s ultimately their passion, hard work and persistence that will bring them financial security.

Myth No. 3: You should pamper yourself every time you get a big break.

The reason many people don’t move up the social ladder is that they’re guilty of the “entitlement mentality,” which drives them to take things for granted. People who have this mentality are those who, instead of finding ways to save money, look for ways to throw it away by succumbing to their personal indulgences. The entitlement mentality is dangerous because it can trap you in a deep pit that you can only escape if you denounce your sense of entitlement.

When you acknowledge that the road to financial success is laden with sacrifice and compromises, only then can you begin your journey to wealth—or to financial stability, at the very least.

In the next part of this article, we will share three more such money myths. Myths are how we make sense of the things we don’t understand. However, they could also make us too set in our ways to explore different avenues for financial growth. Hence, from time to time, it is good to question and examine long-held financial beliefs. (For more on such personal finance topics, visit our blog here—https://www.moneymax.ph/blog/)

Munmun Nath is the managing director of MoneyMax.ph, the Philippines’ leading comparison website for insurance, credit cards, and loans. We want to help you save money through free and fair financial information, so please tweet us: @MoneyMaxPH, like us on Facebook: MoneyMax.ph, and email your to munmun.nath@moneymax.ph. For more information, visit our website: www.MoneyMax.ph





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