Widely held beliefs about money
Happy Wednesday!
You’ve likely heard the story about young George Washington chopping down a cherry tree.
I first heard it decades ago as a lesson about honesty and telling the truth.
And while this story is widely believed, it never happened.
It was invented by Mason Locke Weems, a 19th-century bookseller.
The story was first published in 1806 in the fifth edition of The Life of Washington.
And for most of us - myself included - it became an accepted truth that’s survived centuries of telling by our teachers and parents.
The irony isn’t lost on me that this story about truth telling is a complete fabrication.
I’ve touched on what we believe and why we believe it before in this article from 2021:
So George Washington didn’t really chop down a cherry tree.
And breakfast became our “most important meal” thanks to a 1944 ad campaign.
I wonder what else we believe to be true that simply isn’t.
Naturally, I wanted to apply this question to our financial lives.
So what are some widely accepted truths that have permeated our personal finances?
Here are a few:
Renting is throwing away money
Credit cards are always trouble
A big tax refund is a good sign
Real estate always goes up in value
Gold is a safe investment
Eliminating small, regular expenses like your daily Starbucks will make your rich
You should always “max out” your 401k contributions
I won’t weigh in on each of the above, though I’ve touched on a few of these in the past.
Feel free to wander around my writing archive here.
Outside the world of money, here are a few untrue but widely believed healthcare axioms:
You need to drink 8 glasses of water each day
You can “catch up” on sleep
You should wait an hour after eating before swimming (I heard this one a lot growing up)
We only use 10% of our brain
I’m no doctor, so do your own research.
It turns out there isn’t much research backing up the “conventional wisdom” above.
I encourage you to be your own advocate and apply critical thinking to the decisions you’re faced with.
Whether it’s about your money, your health, or something else.
Become more curious.
Ask more questions.
Otherwise, you could find yourself doing something - financially or otherwise - just because everyone else is doing it.
Or because it’s just the way it’s always been done.
And believe me… that can lead to trouble.
Thanks for reading…
Until next Wednesday,
Russ