Find out the real truths behind the personal finance myths

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By: Good Nelly
on 3rd Jan,2017

Do you feel that happiness can't be bought through money? If your answer is yes, then you should know that science is telling something else.
Find out the real truths behind the personal finance myths

Do you think that you're managing your personal finances in a superb way? Do you feel that you know all the aspects of personal finances accurately? If yes, then may be you need to get a reality check.

Just a simple question can destroy your self-confidence. Do you feel that happiness can't be bought through money? If your answer is yes, then you should know that science is telling something else.

Check out the 3 myths that that are surrounded around personal finances. Know the real facts to change your conception about your money and personal finances.

Myth no 1: A high degree can help you draw a fat paycheck.

College degree is important. Studies show that a graduate earns around $1 million more than a normal school graduate. The income gap is higher between a school graduate and a person with medical degree. A person with a medical degree will typically earn 2 million more than a high school graduate over a lifespan.

Usually, a bachelor's degree can assure you a good monthly income. However, there are exceptional cases too. People working as electricians and service mail carriers don't get a huge paycheck. In addition to that, there are editors who earn less than the ones with a master's degree.

Myth no 2: You'll be a wealthy person if your income is very high.

A fat paycheck doesn't mean that you'll become a wealthy person. In fact, Stephen Goldbart, the co-author of the "Affluence Intelligence" book is of the opinion that people tend to splurge more when their income increases. People start buying things that they have always wanted to possess right from childhood. People don't think about the amount they should save and the consequences of making a serious change in their money habits.

This is probably why around more than 77 percent of NFL players file bankruptcy or get into serious financial troubles even before retirement.

Myth no 3: You can buy happiness with money.

This has become a myth in the current economic situation. Money is related to happiness nowadays. At least, the middle-class people do relate money with happiness. Studies have revealed that the general outlook of people changes after their income increases. People become happier when they get a pay hike. It has been seen that there is a direct co-relation between money and happiness. A 30 percent salary hike has lead to a same amount of happiness in all classes of people. Income level changes the emotional state of the people. Income level changes the quality of lifestyle. This in turn affects the emotional health of the people.

University of California has also conducted a research recently. It was found in the research that money influences happiness. However, this is not the only factor that affects happiness. Honor, self-prestige and social standing also make an impact on the happiness of the people.

Finally, many people believe that federal and state programs are only given to the people with utmost financial need, but this is not the correct information. Financial aids and grants are actually given to people belonging to different economic levels. A student can easily estimate the financial aid amount by using a calculator on his/her school's website.

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