Last Updated on January 12, 2022 by Road To Free Life
Most of the people believe that in order to be good with money, you have to be some kind of an expert, but that’s really not the case. You just need to know the difference between what is TRUE and what is FALSE.
Money management can appear overwhelming, create uncertainty and confusion. Bringing reality or truth to your money life is the way out of fear. A few years ago I heard “Banks will only loan you money if you can prove you don’t need it.” Which I find out to be true in most of the cases, but it’s also a good thing for everybody. You may ask WHY? Imagine you make $30,000 and you want to make a $500,000 loan from the bank to buy a boat or an exotic car. Do you think they will give you the money? Probably no. But if you would make $300,000 per year, then it would be a totally different story.
Here it is a list with Top 5 Money Truths I Wish I Knew Sooner
1. You don’t need to put 20% down for a home.
Unfortunately, the “20% Downpayment” is widely circulated. Passed down from parents to children and college professors to students.
There are many programs such as FHA loans that help you with mortgages. It allows you to have more flexibility in buying a house. However, the lower you start with, the higher the insurance you need to pay later.
2. Your credit card score is NOT depending on just Paying Timely.
There are many factors which affect your credit score like your bill payment history, credit history age, your level of debt. But there are some factors don’t affect your credit score. Information like income, bank balances, and employment status can influence your ability to get approved, but they don’t influence the algorithm that calculates your credit score.
3. Transportation is a big cost.
A medium person spends 9-25% on transportation. But if you live in an area with reliable access to public transit, the American Public Transport Association reports that you can save over $10,000 per year on transportation costs. If you prefer to travel by your car or thinking about buying one, you should check this post to see how to save money when buying a car.
4. A 9-5 job is not a ticket to financial freedom.
You will never achieve financial freedom if you have a 9-5 job. To change this and live a free life, you can start making money by creating your blog. I manage to make some income from my blog, just after writing about 10 posts. It’s very easy to start your own blog and it can bring you the freedom to travel and make money.
5. You don’t need a lot of money to invest.
A few years ago I was thinking that in order to invest in stocks or mutual funds, you need to have a lot of money to do so. But this is not true, you can start investing with just $100. Here are 3 apps that allow you to start investing directly from your phone. If you want to start investing with $1,000 or more and get a high return, you should check out this article to see how to do it.
What are some money truths you wish to have found out sooner?