money lies that are keeping you in debt

7 Money Lies That Keep You in Debt

Today I want to talk about seven money lies that keep you in debt. These are money lies that are so deeply embedded in our world that we don’t even recognize them as lies anymore. Understanding that they are in fact lies, and sometimes even scams, is the first step to freeing ourselves and helping get us out of the debt that these lies create.

Let’s dive into these money lies that keep you in debt.

Money lies that keep you in debt

Money Lie 1: You need debt to help build your credit score

Hear me when I say: debt does not build your credit score. This is a lie that is so insane and insidious. It will not die! On-time payments help build your credit score. There’s a big difference between those two things.

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The FICO credit score that most of us are familiar with is basically a nonsensical mess. It’s also the same age as Taylor Swift which means it’s fairly new to our financial system.

The fact that this idea has so many of us in this grip and believing that we need debt in order to make that number move is bonkers to me. Now it is possible that if you have some debt that you pay off very quickly, your credit score may go down temporarily. Hear me when I say temporarily, but that doesn’t mean that carrying debt will help your score go up.

Paying off debt quickly simply means that your financial life has changed. In the minds of these credit bureaus (and when I say “minds,” I really mean the algorithm of these credit bureaus) a drastic change is seen as generally negative. It’s a knee-jerk reaction to a big change. As time goes on, they see that you’re managing your money well and your score will go back up.

These 7 money lies are keeping you in debt

Money Lie 2: You need to wait to get out of debt

Procrastination helps no one. I say that as a dedicated procrastinator. Every single time I have procrastinated on something major in my life, I have regretted it.

Believing that you can only accomplish B after you accomplish A is a tactic that a lot of us use to talk ourselves out of taking action in our own lives. It’s an excuse that we allow ourselves and it’s something that can keep you in debt.

A lot of us tell ourselves things like: “Oh I’ll pay off my debt after I get married” or “I’ll start investing after I earn more money,” but these are small delusions that keep us in debt.

Broadly speaking, these excuses keep us stuck. You can learn about investing without having a million dollars to your name. There’s no minimum amount of time that you need to be in debt before you make moves to get out of debt.

Money Lie 3: Budgets are punishment

I’m dedicated to budgeting and believe that it’s the single most useful thing that you can do in your financial life. The lie that budgets are punishment really bums me out. A budget is simply organizing the cash flow into your life and the spending out of your life. That is literally all a budget is.

Yet, we all fall prey to this lie that by budgeting or by simply looking at your money, you are going to drain all of the fun out of your life. This is a sick mindset and it is propaganda against budgeting. I won’t stand for it!

But seriously, having this mindset that somehow taking control of your money via a budget is going to take all the fun out of your life is really unhelpful and it will keep you in debt for the long term.

Money Lie 4: Stuff makes us happy

The mindset that we shouldn’t wait for stuff and that stuff makes us happy is born out of our hyper-consumerist culture. I think it’s also born out of the fact that life is often hard. We want to enjoy our day-to-day and that makes total sense.

Unfortunately, the easiest way to enjoy your day-to-day is by spending money. It’s getting a meal out, buying a cute outfit, and getting that little dopamine spike in your brain to enjoy your life on this earth for a second.

The mindset that a lot of us have and the mindset that is reinforced by our consumerist culture is “I can buy my way into happiness.” But that’s a lie and it keeps you in debt.

Consider the fact that Americans have a ton of stuff. We have so much stuff. It’s very common for people to rent out spaces where they can keep more of their stuff! We have so much stuff that we can’t even keep it in our primary living spaces. We need to have storage units.

Yet a lot of Americans are stressed out and unhappy. The stuff is not making us happy. If you don’t have the finances or the financial knowledge to manage your money, all that shopping is simply going to keep you on a consumerist treadmill and keep you in debt.

Here are a few posts to learn about minimalism and how it can save you money:

Money Lie 5: You can be on a different financial page than your partner

Not being on the same financial page as your partner is actually a very big deal. Now y’all know that I am an advocate for keeping bank accounts separate from your romantic partner. That’s not what I’m talking about here.

I am not saying you need to share bank accounts in order to have a loving relationship and a responsible financial life. However, I am saying that you need to have open communication and trust in your romantic and financial life for you and your partner to move forward together financially.

If one of you thinks that it’s totally okay to carry credit card debt and the other one thinks that credit card debt is the devil, that is not being on the same financial page. If one of you wants to retire early and one of you wants to work until forever, that is not being on the same financial page.

You don’t have to have the same exact financial goals, but you do need to have an understanding of where your partner is coming from. You need to know why they feel the way they feel and you need to come up with a happy medium.

If someone wants to retire at 35 and someone else wants to work until 65, what does that lifestyle in the ensuing 30 years look like? How will you manage that? I’m not saying you all have to retire at the same time, but you have to talk about what that financial lifestyle will look like.

Money Lie 6: The newest or most expensive thing is the “best”

The newest or most expensive thing is always the better thing is such a financial lie and it really grinds my gears. Sorry to sound like your grandpa, but it’s true. The best thing is the thing that works. Maybe it’s the newest thing, but maybe not. In fact, a lot of our newer items are garbage.

We are not using high-quality materials to produce a lot of things anymore. Sometimes the newer item is worse than the item that that was made in 1985.

Just because something has a higher price tag does not mean that it’s a higher quality or better. Your favorite dress might be the dress that you got for 12 bucks at the thrift store.

The most impactful book you may ever read may be the book that you got from the library for free. Try not to allow the marketing that says brand name is better than store brand to get into your head. You don’t always need to be spending more in order to experience the best.

Don't believe these 7 money lies

Money Lie 7: Shopping is a hobby

Shopping as a hobby is a byproduct of living under capitalism. If spending money is your hobby, I don’t want to sound judgmental, but I would really encourage you to sit down and review that.

To me, spending money is not a hobby in the same way as reading, sewing or golfing is a hobby. Reading, sewing, and golfing; these are skills that you can develop. These skills bring you intrinsic pleasure.

Shopping, or simply just spending money, that’s so broad. You could spend money on a yacht or you could spend money at the thrift store.

Shopping as a hobby is simply spending money. It’s not necessarily so much what you’re actually buying. I would encourage you to sit down and ask yourself: why do I enjoy spending so much and where can I get that joy in other ways that don’t negatively impact my financial life?

No judgment, I simply want you to think of this as an invitation to examine where you are in your life and if that’s actually where you want to be. I want you to examine the relationship to shopping that you want to have.

To me, things like sewing, reading, and hiking there are other things of value that come out of that. Hiking is exercise, painting is a skill, and reading can give you knowledge.

Shopping simply means you have less money and probably some sort of tangible object. But what long-lasting skill or joy has come out of that?

What are other financial lies that keep you in debt?

Let me know in the comments if you think there are other lies that society tells us that keep us in debt.

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