MYTH 1: My financial condition is so bad that my situation is hopeless.

 

REALITY: Although your problem may not be solved in a way that you would envision, a resolution can always be found. Open your mind and be realistic about your options. Ultimately, you have to choose a solution with which you are most comfortable.

 

MYTH 2: If I co-sign on a loan, the lender will never come after me.

 

REALITY: Wrong. You co-signed for the loan, which means you promised to repay the debt if the borrower couldn’t. When the borrower is unable to pay back the loan, you are on the hook. Unless you are prepared to repay the loan when the borrower defaults, you should never co-sign any loan.

 

MYTH 3: If I don’t use credit, I’ll never have anything.

 

REALITY: If you don’t use credit, you won’t have debt. Remember when people used to pay for purchases in cash? If you want something bad enough, save for it. It is significantly more rewarding to purchase something and own it outright than creating another liability that you owe.

 

MYTH 4: Credit is bad.

 

REALITY: Wrong. Credit can be used for many good and worthwhile purposes, such as buying a home. Credit cards are very convenient when making purchases as long as you’ve got the money to pay off the credit card bill. Credit is like many other things in life: when used incorrectly, it can hurt you.

 

MYTH 5: I can solve all of my financial problems if I sign up for this fantastic work at home business opportunity I heard about.

 

REALITY: Possibly. However, most people invest their last few dollars into such an opportunity, hoping it will save them from financial misfortune. They usually don’t have enough business experience to be immediately successful, and once they invest their available funds getting into the program, they don’t have enough money to sufficiently operate the business. Don’t believe that you will be rich just because the person that told you about the opportunity appears to be doing well. That person probably has much larger bills than you do, and is trying to recruit as many people as possible into the program to keep himself from sinking.

 

If you have extra money to play with, then get involved and have a good time. But be prepared to lose both the time and money you invested. Do it because it’s fun and you really enjoy the people you work with, not because you are betting that the business will solve your problems.