"Five Money Myths"

Let’s look at some of the myths and lies surrounding money. According to John M. Cummuta, one of the country’s foremost experts on financial matters, there are five "Great American Myths" about money; they include the following:

Myth #1: You can use money the same way everyone else around you uses it -- and still end up financially independent.

At last report, 95% of Americans DO NOT achieve financial independence by age 65. And neither will you if you continue to follow the Joneses. RWU advice: stay out debt, pay your bills on time, live within your means, and buy according to your needs, not your wants.

Myth #2: To be successful, you have to work "Smarter, not harder."

Anyone who has achieved or is working towards achieving financial independence will tell you that you must work (at least in the early going) smarter AND harder. The price of financial freedom must be paid in full...and it must be paid in advance. There is no such thing as a rain check on success.

Myth #3: It takes OPM (other people’s money) to make money.

If you are using other people’s money, that means that you must eventually pay those same people back (with interest). Use common sense when it comes to borrowing. Borrowing money to make money is risky business at best. Don’t play Russian roulet with your financial future; it’s not worth it.

Myth #4: The more education you have, the more likely you are to be successful.

Do the names Edison, Einstein, Ford, and Gates ring a bell? Well, other than changing the way we see, think, drive, and work, they all have one thing in common: they were educational failures! There was a study a few years ago that reported that 66% of all self-made millionaires never completed college! That’s right, you’re actually hurting your chances of making any "real" income by attending college.

The skills that help you achieve success and financial independence are simply not taught in universities. That was never the purpose of college. The purpose of college was to prepare you for a career. But don’t worry, RealWorld University is here to pick up the slack.

Myth #5: Putting your money in a bank, in CDs (certificate of deposits), and money market accounts, will earn you financial independence.

Wake up and smell the coffee. If a bank is paying you 3-4% on your money, and inflation is rising at 5-7% each year, how in the world will you ever be able to build financial security on a -2 or -3% return? Hey, you don’t have to pass algebra to figure out that this doesn’t add up.

In fact, the only people who get rich putting their money in the banks are the owners of the banks. Of course, you still need to have some of your money in banks (i.e., to write checks and pay bills); however, there are much better investments out there than banks. Consider investing in growth mutual funds and stock index funds for long term financial security.

And of course, there is no better investment than investing in yourself -- meaning educational materials and courses that teach you entrepreneurship and how to start your own business (remember the 66% statistic). Look at it this way, if you work for yourself, you’ll never have to complain to the boss about deserving a raise.