10 Money Myths That Could Be Costing You
Most people build their financial beliefs on things they’ve heard—online, from friends, or even from parents. The problem is, a lot of that advice is wrong.
Bad information leads to bad decisions.
In this issue, I’m breaking down 10 common money myths that keep people stuck. These are the ideas that sound smart on the surface but fall apart when you look closer.
Time to clean up the noise.
1. “Renting is wasting money.”
Homeownership isn’t always the better deal. You're also paying for:
Property taxes
Maintenance
Insurance
Mortgage interest
Realtor fees
Unexpected repairs
If you’re not settled or staying long-term, renting can be the better financial choice. Buying only makes sense when the math—and your lifestyle—support it. The decision is truly based on timeframes.
2. “Investing is only for rich people.”
This is one of the most damaging beliefs.
You don’t need a high income to invest. You need consistency.
Starting early—even with small amounts—builds the habit and gives compounding time to work. What matters most is that you start.
3. “If I make more money, I’ll pay more in taxes, so it’s not worth it.”
In the US, we use a progressive tax system. That means:
Only the income in each bracket gets taxed at that rate
Your entire income doesn’t jump to a higher rate when you earn more
Making more money always puts you ahead financially, even with more taxes.
At the end of the day, paying more in tax typically means you made more money....
4. “I don’t need insurance.”
I agree! Except I would say I don't need unnecessary or the wrong type of insurance.
If anyone relies on your income—spouse, kids, aging parents—you probably do.
Insurance isn’t about returns. It’s about risk transfer.
You insure against low-probability, high-cost events:
Death (life)
Lawsuits (umbrella liability)
Paying for care (disability, long term care)
These are low-cost protections for massive risks. It's all about having the right amount and right type of insurance.
5. “Only business owners get tax breaks.”
Business owners do get flexibility. But W-2 employees still have solid planning tools:
401(k), IRA, and HSA contributions
Roth conversions and backdoor Roth
529 plans
Tax-loss and gain harvesting
You just need to use what’s available. Most people don’t.
6. “HSAs are only for medical costs.”
Used right, an HSA is the most tax-efficient account available:
Contributions are pre-tax
Growth is tax-free
Withdrawals for medical expenses are tax-free
The better strategy: Pay current medical expenses out-of-pocket, let your HSA grow and compound, and reimburse yourself later. It’s a stealth retirement account if you play it right.
7. “All debt is bad.”
Debt is a tool. Like any tool, it depends on how you use it.
Bad debt: high-interest, unnecessary purchases
Good debt:
Mortgages
Business loans
Student loans (in some cases)
Credit cards get a bad rep. But when used right—paid off in full, on time—they help build credit and offer rewards. It’s about discipline, not the tool itself.
8. “High earners can’t use a Roth IRA.”
True—you can’t contribute directly if you’re over the income limit.
But there’s a legal workaround: the Backdoor Roth IRA.
Step 1: Contribute to a traditional IRA
Step 2: Convert to Roth IRA
You just need to be mindful of the pro-rata rule if you have other pre-tax IRA funds.
BONUS: If your 401(K) allows it, you can also make Roth 401(K) contributions.
9. “Just invest in the S&P 500 and forget it.”
This works for beginners. It’s a simple, low-cost, diversified way to start.
But real planning involves a lot more:
Asset allocation and location
Tax strategy
Risk management
Retirement income planning
Estate and legacy planning
An index fund can’t do that. You need a plan, not just a product.
One of the most significant values we bring to our clients is behavioral coaching, which involves knowing when to buy and sell. Primarily, not selling when the market is falling and instead buying more.
10. “Business expenses are write-offs, so they’re basically free.”
No. Write-offs reduce taxable income—they don’t make things free.
Example: Spend $10,000 and you’re in the 37% tax bracket? You save $3,700 in taxes. But you still spent $6,300.
Only deduct expenses that are ordinary and necessary for your business.
Otherwise, it’s tax fraud, not tax planning.
Bottom Line
The goal isn’t to be perfect with money. It’s to avoid the common traps that cost you time, income, and opportunity.
Get the big things right, and the rest falls into place.
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About the author: Finn Price, CPFA, CEPA, is a business owner and wealth manager at Railroad Investment Group. He helps successful entrepreneurs & individuals with concentrated stock positions in their 30s, 40s and 50s build, organize, protect and transfer their wealth.
Note: this article is general guidance and education, not advice. Consult your money person or your attorney for financial, tax, and legal advice specific to your situation.
Securities and advisory services offered through LPL Financial, a registered investment Advisor, Member FINRA/SIPC.
