There are money axioms that are touted so often they’re taken for truth. But that’s not to say they should be.
Here are a few beliefs about money you’re better off ignoring.
Credit cards are dangerous: They’re dangerous if you misuse them. “Credit cards can assist with cash flow. If the air conditioner breaks and you don't have money to fix or repair it, paying by credit card makes sense if the money to cover the cost is on the way,” says Joshua Zimmelman, president of Westwood Tax & Consulting in Rockville Centre.
Monitor the latest fads: “This is the quickest way for investors to self-destruct. The biggest fad I’ve seen in my investment lifetime: The cryptocurrency market is a bubble and it won’t end well for investors. There is nothing to support the valuations of bitcoin or any of the other cryptocurrencies. They don’t have any cash flows associated with them,” says Robert Johnson, co-author of "Strategic Value Investing."
My 401(k) will be enough for retirement: Hardly. “I believe in the retirement trifecta. In addition to your 401(k) or IRAs and Social Security, I recommend having one or two investment properties that will yield free cash. As we don't always know what our expenses will be in retirement, it’s important to make sure that there are enough sources of income to live comfortably,” says Zimmelman.
Invest in what you know: Avoid investing only in what you know. Says Gary Rudow, managing director of investments at Stifel in Manhattan. “Complacency can end up stagnating your portfolio. Don’t be afraid to research, learn about new things, and develop and grow your portfolio.”