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Building wealth is about educating yourself on the “how-to” and adopting a money mindset that helps you grow. Some of the things that hold us back are the lies we tell ourselves about money. With the help of a few friends, this article highlights some money myths and provides you a solution so you can turn what you want into a reality.
Travel
Money Myth: Traveling is too expensive. It will take me years to save enough money to travel internationally.
Solution: This might have been true for your parents, but it’s not true anymore. Today, on top of airline membership rewards programs, many credit cards will help you ‘save’ for international travel by awarding you points for the dollars you spend.
Not only will you receive points for simply using these credit cards – but they also offer bonus points just for signing up. You earn bonus points after you use the new credit card on a specified amount of expenses within the first 90-days of opening your account. Then, you can exchange the award points for flights, hotels, and rental cars.
Don’t use these cards in a way that will create debt! Use the credit card to purchase something you already have the money to buy, then pay off the credit card with the cash you’ve saved.
Once my husband and I opened a credit card when we’d just saved over $5000 for a project on our home. The card offered a large number of bonus points for using the credit card on $4000 worth of purchases within the first three months.
We used the card to pay for the entire project and then paid off the card’s balance with the cash we’d saved. With the bonus travel points we earned, we paid for two international round-trip tickets and a rental car we used during the trip. Now we use that card to pay for gasoline, utility bills, and groceries. We’ve almost saved enough points to plan our next international trip!
Cindi Conley of Traveling Later
Instagram and Pinterest: @travelinglater
Twitter: @Cindithewriter
Wealth
Money Myth – I can’t be wealthy because my family is not wealthy.
Solution – Wealth creation begins in your mind. Regardless of where you start in life, you can become wealthy. However, before you can start your wealth-building journey, you must remove the mental barriers that are confirming this myth. You must believe you can become wealthy if you choose. Once you are committed to achieving wealth, next, you must align your resources (time, talent, money) to make it.
Wealthy people focus on purchasing assets such as stocks or exchange-traded funds or real estate. While those who are not wealthy, buy liabilities or things that do not add value such as cars, clothes, and shoes. Most adults are trained to become consumers rather than producers. Once you understand that you have the power to choose, you can make decisions that work to your advantage.
Related: 10 Habits that are Destroying Your Wealth
So, if you want to be wealthy, evaluate how your money aligns with this goal. Consistently direct a portion of your earnings to assets that produce more income.
An easy way to start is to invest in your employer’s 401K plan and contribute to a Roth Individual Retirement Account (IRA). In addition to your retirement contributions, pay yourself first, and create a three to six-month cash reserve for unexpected events.
Lastly, focus on creating another stream of income that you can direct back into income-producing assets. Multiple streams of income create a wealth snowball effect that continues to grow in your absence.
Once you focus on creating wealth, you will be amazed at how many wealth-creating opportunities appear.
Stephanie of Finances On Point
Instagram: @_financesonpoint_
Income
Money Myth: You can’t make more money. It’s too hard to make money.
Solution: Embrace the fact that your earning potential is limitless.
Five years ago, I did not think that I could make more money outside of my nine to five job. This was before side hustles were a thing, but that all changed after I started a travel blog and invested in my first travel blogger conference.
Investing in resources that aligned with my passions–even when I didn’t know where it would lead–and taking action, helped me start earning more money as a freelance writer. The more I practiced, the more my portfolio of clients grew.
Lastly, if you’re struggling with overcoming a scarcity mindset, read the book You Are a Badass at Making Money by Jen Sincero. This book has fantastic mantras to help you break free from limiting money beliefs, even the ones that you didn’t realize you had!
Danielle Desir of The Thought Card
Twitter, Facebook, Instagram, and Pinterest: @thethoughtcard
Money
Money Myth: If I had more money, all my problems would be solved.
Solution: If your money habits make it difficult for you to manage $1,000, you will have the same trouble with $10,000. Track your spending, create a budget, and give every dollar a job so you can save, invest, and manage your expenses.
Financial literacy is essential to building wealth and doesn’t magically come to those who suddenly come into money.
It’s necessary to learn how to manage your money with your current bills and expenses. Find ways to save more by lowering or eliminating expenses that are not essential for your family.
Related: How to Raise Your Credit Score and Have Debt
Create a budget based on things you value most. For example, if a happy hour with your friends is essential, put it in your budget. But to keep a happy hour in the budget cut back somewhere else like on your cable or cell phone bills.
The sacrifices you make today provide a better future for you later. Tracking your spending and budgeting is the best way to know where your money is going.
If you adjust your money habits and find it’s still hard to make ends meet–then it’s time to make more money.
Acquania Escarne of The Purpose of Money
Instagram: @thepurposeofmoney
Twitter: @Purpose_Money
What’s another money myth you’ve heard that you need to forget? Share it with our Purpose of Money community in the comments below.