Debunking 5 Financial Myths

Clearing up common money misconceptions that could be costing you.

What you don’t know in finance CAN really hurt you – particularly when it comes to your budget and your wallet. Unfortunately, knowledge in personal finance is often left to trial and error, so you only learn lessons by making mistakes that can hurt your bottom line.

That’s why “financial literacy” is so important. Being financially literate means you understand key financial topics well enough to make smart choices with your money in most circumstances. It means you’re not caught off guard by the unexpected or by the effects of using a financial tool that you didn’t fully understand.

With that in mind, Consolidated Credit has created a selection of resources that help you gain financial knowledge on topics that people often get wrong when it comes to personal finance. In addition to the video above, we have a 20-question Financial Literacy Test that covers basic personal finance and money management topics you should know in order to maintain stability day to day.

Financial education is a lifetime effort

The Financial Literacy Test is designed to help you identify gaps in your understanding so you know where to start building your knowledge. It’s important to note that financial education should be a lifetime endeavor. Ideally, you want to focus on one key topic or area of your outlook where you feel you lack knowledge or are weak in your ability to manage that part of your outlook successfully.

Once you fill in a knowledge gap, you should find another one and focus on building your understanding. So, for instance, if you’ve never reviewed your credit report, you can start with credit resources that help you understand what your report says and what it means for your credit score. Once you’ve cleaned up your credit, move on to another area, such as investing. The more you learn, the better you’ll be able to make the right choices to achieve your goals.

If you need a roadmap for this kind of gradual knowledge building, we also offer a 30-day Financial Literacy Check List. This gives you a different actionable task you can complete each day to get a better picture of your financial world. During the 30 days if you run into a topic that you don’t understand, you can use free resources like our financial education center to increase your understanding so you can keep moving forward.