10 Lies About Money You Probably Still Believe

There are many lies about money you probably still believe.

Don’t blame you – I did believe many of these money lies as well before I put my brain into gear and did some sums. You don’t even need complex maths, or any maths for that matter, to see that some of the money ‘wisdom’ in circulation is as washed out as you granny’s bloomers. Some critical and questioning thinking would do!

Tonight, I’d like to share with you the top ten lies about money on my lists. These are:

  • You need a budget
  • Ownership trumps hire
  • Frugality will save the day (and your bank account)
  • It is too late to invest (to make your fortune)
  • Compound interest is king
  • Early retirement is from the land of the fairies
  • Investment analysis rules
  • Education doesn’t matter for wealth (and success)
  • This is too little money to make a difference
  • It is all in your hands

Now let me tell you why I believe these ten regularly recycled money statements are, if not complete fabrication, very highly misleading. These are lies about money that not only will hurt your bank account but also believing in them makes you look as ridiculous as a husky wearing a coat on a mild autumn day. (Yes, I’ve seen this one and felt profoundly sorry for the husky.)

#1. You need a budget

No, you don’t and if you continue defining your problems wrongly there isn’t hope for you; in life and money. See, when you say that you need a budget, you are saying that not ‘a budget’ is your problem. In fact, your problem most likely is that you are over-spending.

There are many ways to deal with over-spending.

One is to make a budget and try to fit your life in it. This is a bit like buying a pair of jeans that are two sizes small and trying to fit in them. Have you tried this one? (I did when I way fifteen and it isn’t great, trust me.)

Another one is to change your life and learn to want less. Now this one is more like going to a slimming club and loosing enough weight to buy jeans two sizes smaller than the ones wearing now. Makes sense, yes?

Do me a favour and forget that you need a budget. Instead learn to stop wanting things and never look at another budget again.

#2. Ownership trumps hire

Not always. Whether you own things or hire them depends on many things including how much you move around (stage of life), how much is your monthly income, how secure is this income, how you cope with uncertainty, do you relish being custodian of all your possessions etc.

Did you know that last year renting accommodation was cheaper than buying in half UK cities? (And please don’t tell yourselves that buying a house is an investment; it isn’t. Now that we are clear on this one…)

#3. Frugality will save the day (and your bank account)

No, it won’t.

Whether you are looking to pay off debt or build investments frugality alone makes very little positive difference. If anything, directing all your energy and creativity towards more ingenious ways to limit the bloodstream of your life means that there is not much left for chasing opportunities to expand.

Eliminate waste but watch the frugality thing – it can become a goal for its own sake.

(I have a big problem with the whole ‘latte’ thing. Don’t get me wrong, I think you should stop drinking latte immediately but because it is travesty of a coffee; not because this will make you wealthy.)

#4. It is too late to invest (to make your fortune)

I spent years of my life feeling as a money failure because people told me that it is too late to invest (or make my fortune) because I’m already out of diapers. (Okay, I’m exaggerating a bit; it was about me being over forty.)

It is never too late. You can always turn your money destiny around. We did!

Eight years ago, I had less than £1,000 savings and £100,000 worth of consumer debt. I was in my mid forties and yes, I do have a job that pays decently.

I had a choice: believe that it is too late or decide to turn the whole money thing around. I went for the latter.

Today we have no consumer debt and low six figures new investments. I’m in my mid-fifties. And you know what? I still have way to go.

#5. Compound interest is king

Yep. This is about the glory of compound interest.

You believe this one, don’t you?

What would you say if I told you that compound interest is overrated?

It is a great notion, but unfortunately compound interest works best when you either have loads of money or you have a lot of time. While the first defeats the purpose (most investors rely on compounding to make money), the second exceeds our natural life span.

#6. Early retirement is from the land of the fairies

It isn’t.

There are two groups of people around me at this stage of my life.

One group consists of people who worry about their pensions and retirement all the time and claim, probably with some justification, that they won’t have either.

The other group consists of friends who retired early.

What is the difference between the two groups?

Early retirees were highly motivated, pragmatic and understood the tax system. Oh, and they also knew that early retirement (or any retirement) is not about having a lot of money; it is about being prepared to change your life.

#7. Investment analysis is boss

Many investment firms lure you in by promising robust investment analysis.

This is all highly problematic. It was always challenging to analyse stocks and predict where they may be going; today, when companies have become ‘fiat’ firms, stock analysis is. I’d say, impossible.

You don’t believe me?

How about Oprah saying something nice about Weight Watchers and the stock jumping up?

How about some reality ‘star’ saying that she is off Snapchat and the share plunging?

Go analyse that!

#8. Education doesn’t matter for wealth (and success)

Education matters for wealth and success. You may be excused to believe that degrees don’t matter (though, they probably still do in most industries.)

Whenever someone tells you that going to university (college) doesn’t matter check their background.

Likely they have been to university. Very likely, they have been at one of the top universities in the country.

#9. This is too little money to make a difference

There is no such thing as ‘too little money’.

If you have £5 left in your account put it against the debt; or send it to your investment account.

It all adds up and it all matters.

Conversely, nothing costs ‘only £5’. There are many things that cost £5 and whether you buy them or not is not a matter of them costing ‘only…’.

#10. It is all in your hands

Most personal finance leans heavily towards neo-liberalism. This means that personal finance ‘experts’ would tell you that ‘it is all up to you’.

You are poor? It is your responsibility.

You want to build wealth? Of course, you can do it. Anyone can do it because your destiny (and success) is in your own hands.

Hate to burst this bubble but this is all a very large crock full of poo.

Anything that you – or I, or anybody – achieve in life comes about because of what you do and a set of other conditions over which you have very little control.

In other words, success – financial or any other form – is a statistical probability; not something that is entirely up to you. All you could do, if you are smart, is to figure out how to maximise the probability of success.


Tonight, I shared with you the ten lies about money that top my list. There are many others.

What are the lies about money you can think about?

photo credit: willowmina Shadow via photopin (license)

5 thoughts on “10 Lies About Money You Probably Still Believe”

  1. “Whenever someone tells you that going to university (college) doesn’t matter check their background.”

    Yes! With the A level results out last week, I saw one person on Twitter say people with good results would be better off spending their time and money on travel and reading books and working on projects for free…

    He runs a small company and I had a look at the 4 job vacancies on its website – they all said things like “The position would suit a recent graduate” or “You probably have a strong degree in either Computer Science or another quantitative field”

    • @Sara: Good call Sara. It is irresponsible to tell people they don’t need qualifications when you have plenty yourself and when you recruit grads. I think it comes from conflating ‘degree’ and ‘education’.

  2. Passion first then learn all that you can get from the “authors of origin”. Consistency and persistence second. Stick to the basics.


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