Money Saving Myths That Are Ruining Your Finances

You can find tips and advice about saving money all over the internet on great sites like this one. A lot of that advice is good and if you follow it, you will be able to improve your finances. However, there is also a lot of bad advice out there and the problem with the internet is. Bad advice spreads quickly and people start believing it’s good advice.

There are many common myths about saving money, which can actually do more harm than good if you follow them. If you follow all of the advice but you still don’t seem to be able to improve your financial situation. It may be because you have fallen prey to some of these big money saving myths. 

Cheaper Is Always Better 

Surely, if you want to save money, you should buy cheaper stuff, right? In some cases, that’s exactly right, but it’s not quite as simple as that. Say, for example, you see an item that costs $5 when it’s usually $10. So you snap it up to make that $5 saving. If that’s an item that you would have bought anyway, you’ve made a saving. But if it’s something that you wouldn’t normally buy and you only picked it up because it was cheap. You’re not actually saving money, you’re wasting $5 on something that you don’t really need. 

You also need to think about the quality of the things you buy. As well as how often you are going to replace them. Clothes are the perfect example of this and people always make the mistake of buying cheap stuff. Because they think they’re saving money. But cheap clothes last a few months at best. While the more expensive ones will last years if you look after them properly. By the time you’ve replaced the cheap clothes 5 or 6 times. You end up paying more than you would have done if you bought quality in the first place.

But…

There are some great online brands like THE ICONIC, where you can buy high quality clothes for reasonable prices. Investing a bit more money upfront will help you make long term savings. So don’t just consider the short term spending. It’s not just clothing either, this also applies to things like tools, appliances, furniture, and cleaning products. 

Take discounts with a pinch of salt too because a big sale sign doesn’t actually mean the item is cheaper. It’s a common tactic for businesses to hike the price of products for a few months. Then drop them again, claiming that they’re giving you a huge discount. In reality, you’re paying the standard price for it. So always use price comparison sites and price trackers to see whether the deal is actually a deal. 

Always Rely On Coupons 

Coupons can be a great way to save money and you should use them sometimes. But relying on coupons and using every single one you find isn’t a good way to save money. A lot of coupon deals require you to buy multiple items to get the discount. Which means that you end up buying way more than you normally would just to get a small discount. On non-perishable items that you buy regularly, like cleaning products. As well as buying in bulk to get coupon deals is a good way to save money. However, when it comes to perishable food products. Avoid spending more than you normally would just to get the deals. Because the extra food is likely to get wasted. 

Stop Buying Coffee And You’ll Be Rich 

So many people get drawn in by the idea that if you stop buying takeaway coffee you’ll become rich overnight. It’s one of those things that people always point to when giving advice about cutting back on spending. It is usually representative of a more general idea that cutting back on frivolous spending is the best way to save money. 

If you eat out and drink takeaway coffee every day. Cutting it out will save you a good amount of money. However, focusing on the small expenses will only get you so far and if you really want to improve your situation. You should be looking at your big monthly bills instead of your morning coffee. 

Look for ways to cut back on your energy bills or save on home insurance, for example. Could you remortgage your home for a better monthly rate? Finding ways to make savings on the big things gives you more expendable income to put into savings. Which is how you will achieve long term financial stability. 

Only Rich People Can Invest 

Investing your money is the best way to increase your savings and secure your financial future. But many people believe the myth that only rich people can invest and you need thousands to get started. So they don’t even look into it. But that isn’t actually the case at all and it’s easier than ever for novices to start investing. There are some great online tools, like robo-advisors, which analyze information and help you make sensible decisions. There are some great investments you can start with just $100. The earlier you get started, the more money you can make. So, even though you aren’t rich, that doesn’t mean you can’t invest some money. However, you do need to remember the golden rule of investing; only invest what you can afford to lose. 

Debt Is Always Bad 

If you want to save money, debt can cause you some real problems. It’s tough to contribute to your savings account when a big portion of your income goes towards credit card bills. Which is why debt is a bad thing, in most cases. However, it’s a mistake to say that debt is always bad. Because borrowing money helps you build a good credit rating. Using a credit card responsibly and paying it off right away. Is a positive thing that will save you money in the future. When you take out a loan to buy a car or a house. You’ll get a better interest rate if you have good credit, meaning that you save money. 

If you keep falling for these money saving myths. You will find it much harder to get a grip on your finances.