Old Financial Advises are Becoming Worthless – MUST READ

Old Financial Advises are Becoming Worthless – MUST READ

Work Hard, Save Money, Get Out of Debt, & Invest for the Long term in Mutual Funds?

What a great Financial advise above is? When I first time entered into the Personal Finance, Business & Investing field (2003), the above used to be the golden financial advise. In fact, the above was the advise by which I became so much fascinated that I started learning more and more about Business & Finance.

But Since 2007, I am seeing that the above string of financial advises are becoming worthless.

Yes, This is a sad truth. Don’t get me wrong but the things that are going in the current economic world indicate that the above golden advise is becoming worthless day by day. This is how why?

01) Why work harder when governments are raising the taxes? -

If you work hard, you earn more. But at the same time governments from all around the world are raising various types of taxes. So everything you earn extra by working hard goes towards paying taxes only. This is the scenario of Individuals and high income people like Doctors, Lawyers,…etc…

But if you own a Business (Company) than you have to pay less in taxes because you can deduct all of your expenses as a company’s expense. Say for Example your new Mercedes car will be your Business vehicle on paper and your New MacBook Pro will be your Business Equipment on paper and so on. If you are the Rich, I mean if you are the Business & Investment holder, you have to pay less in taxes.

02) Why Live below your means when the Inflation is on the Horizon? -

I love the idea behind this advise. In fact, this is one of my favourite financial advise. But because of the Inflation, it is getting difficult day by day to live below your means also. Because your salary doesn’t increase as that of Inflation.

03) Why Save Money when the Government is printing Money? -

Saving Money is a Fool’s Plan now. If someone is saving money than I am sure that rich will definitely think that he/she is following a Fool’s Plan. Everyday since 2007, Governments and central banks from all around the world are printing billions of dollars and pushing it into the circulation which is diluting the purchasing power of the existing money in the world economy.

So it means that if today you save money than it means that yesterday it’s purchasing power will be diluted because of the printing activities of the government.

04) Why To Take out of debt when the borrowed money is cheap (Low Interest Rates) and easily available to grow your Assets & Businesses? -

My Another Favourite Financial advise. In fact, I advise people to get out of debt and stay away from debt. Because if you want to be financially free than you have to kill debt first. This is what I learn from personal finance books and Finance gurus whom I consider my mentors.

Now, what I see today is, Rich people are borrowing millions and billions of dollars from the US government because the borrowed money is cheap. The Federal interest rates are ground zero. And that’s why anyone in the world who owns a Business can borrow money from the US Government at almost 0% interest rate and use this money to grow his own Business & Investments.

By Using Debt, Rich are getting richer.

In short, the Old Financial Advises are becoming worthless day by day…!!!!