Intro:
Hello. Welcome back to my YouTube Channel. In today’s video we’ll be talking about the myths that are going around Personal Finance and would be providing a logical reason to bust each of these myths.
Main content:
1. Health Insurance:
Now, you would say that, “what (client’s name) buying a health insurance is a myth? What are you saying?”
No, hear me out on this.
There is a general belief that “If you have health insurance there is nothing to worry about”. However, this is half true.
Especially during the times of covid, when the healthcare costs were exorbitantly high, the health insurance you have might not be enough. Plus, you need to check about the illnesses covered and the hospitals that are included in the list.
So, the next time you plan on buying health insurance, do proper due-diligence from your end.
2. Formula for trading in the stock market:
If I count the amount of money I have lost by listening to people’s formula for investing in the stock market, I will probably start crying.
No one can predict how the stock market will perform the next minute.
A winning investment strategy involves maintaining a diversified portfolio to balance the ups and down of the market but other than that there is no systematic formula.
3. Invest a sizeable amount of money:
If somebody tells you that you need to have a huge chunk of money to start investing, consider it as a trap.
Whatever your income is, make sure to save at least 10% of it every month.
Investments in SIPs can be started for as little as Rs 500. So, start saving today, irrespective of your income.
4. Pay off high interest debt first:
Agreed, paying off your high interest loan will get you out of debt faster.
But, that being said it will result in high cash outflow from your business and might turn out to be a daunting task.
What I would suggest is pay off smaller balances first to build the momentum and then attack your larger balances.
5. Credit cards improves credit score:
There is some element of truth in the above statement.
A credit card will improve your credit score provided you pay back all the dues every month on time and use the credit lightly.
However, if not, your credit score will be severely damaged and you will end up paying even more money as your interests grow.
Outro
These were the 5 myths related to Personal Finance that each one of use should take care of. Comment down below which of these came as a shocker for you and till then Like, comment, share and subscribe to my channel. Goodbye!