It’s time unleash yourself from Financial Myths

Myths surround almost any investment and personal finance process and we can blame lack of financial education for most part of it.   This article is an attempt to reveal some most common myths and misconceptions about the personal finances and suggests a right path to financial security.

Financial misconceptions prevail in any sort of investment and personal finance strategies. These self stated fantasies and semi-truths are dangerous bits and pieces as they become the part of your vital investment portfolios.

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Myth or Reality: Knowledge of Investment Products can keep you Safe

Several studies have shown that knowledgeable investors usually fall prey to the scams and fraudulent schemes in comparison to those who know less about the investment procedures and policies. The problem lies with knowledgeable investors is that they know much about the personal finance and investment so under the impact of overconfidence they fail to detect wrong investment products and portfolios. It’s therefore suggested that being an investor, chances of being dumped comes prominently.

 

Myth or Reality: Your retirement account’s growth depends upon the fund’s performance

The only way to grow your retirement account is to save more and more from your daily savings. Here you must not consider deporting a handsome amount of money from your salary since it can put a serious crunch on your savings. Try to engage your eye on the long term savings rather investing on various funds and all. Fund market is completely volatile so if you are trapped in a wrong fund, you will lose a big amount of money for sure.

 

Myth or Reality: Dollar Cost Averaging improves Rate of Return on Investments

It’s a fact that cost averaging of Dollar is a popular investment strategy among investors and involves an equal amount of currency infuse into a particular investment at regular intervals and in equal bites. However experts believe that this strategy not necessarily yields good results as such. With the process of cost averaging of Dollar, you automatically buy more shares from the capital market when share prices are low and in case share prices are high, you usually buy less quantity of shares.

 

Myth or Reality: Personal bankruptcy filing can cost your home

In the prevailed nature, people mortgage their home in the case of bankruptcy and when they don’t have much liquidity to pay. State laws on bankruptcy however vary from state to state so not in every case the situation is true. The people who have lesser home equity keep their home back even after bankruptcy if they file for Chapter 7 bankruptcy to the authorities.

The Chapter 13 bankruptcy is another option which usually requires you to pay overdue mortgage bills upon filing the bankruptcy suit. This sort of bankruptcy usually entails a debt-repayment plan that enables you to pay past-due mortgage bills over time in case of less liquidity and currency inflow.

 

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