Finance Myths, Busted
Unraveling the misinformation
Debt is always wrong
Evidence supports this too. Research shows responsible borrowing helps one develop and maintain a good credit history; it enables people to secure better interest rates or loan terms when they borrow in the future, and in the long term, helps reduce financial risks or financial difficulties.1
You need a financial advisor to make any good financial decision
Evidence-wise, studies have shown that individuals who educate themselves and take control of their finances tend to plan their finances better in the future.2 Learning about basic economic principles and staying informed can go a long way in securing your financial future. So, while financial advisors can be great allies, you have the power to make intelligent financial choices on your own too. It’s all about finding the best balance for you and your unique situation.
A higher income means better financial health
Credit cards should be avoided
We have all heard horror stories about people who get a credit card and just purchase and purchase, ignoring that they must pay that back. And if they don’t, they get hit with high interest rates and, with that, a mountain of debt. But credit cards, if used responsibly, do offer benefits.
First, they offer convenience and security for online purchases. Plus, they can help you build a strong credit history, which is crucial for getting a car loan, renting an apartment, or even getting a mortgage. Responsible credit card use ensures you are paying your credit card off before interest begins to accrue, which can improve your credit score. When you make consistent, on-time payments and keep your credit utilization low, you demonstrate reliability to creditors. Those who use credit cards responsibly and don’t maintain outstanding balances typically save $300 to $400 annually.4
Finishing the financial folklore
2 Strömbäck, Camilla, et al. “Does Self-Control Predict Financial Behavior and Financial Well-Being?” Journal of Behavioral and Experimental Finance, vol. 14, 2017, pp. 30–38, .
3 Folger, Jean. “How to Manage Lifestyle Inflation.” Investopedia, 13 July 2022, .
4 Emily_Lorsch. “Why You Should Buy Everything with Credit Cards – Provided You Meet 1 Condition.” CNBC, 14 Mar. 2023, .