Social media is filled with a lot of bad financial advice. That’s why GFL NYC asked some legit financial influencers—also known as finfluencers—to debunk some common money myths and set the record straight for NYC high school students. From crypto to cash stuffing, from part-time jobs to the value of a college degree, here’s what they have to say.
Working
Myth: It’s just a paycheck, I don’t have to take my job seriously.
Reality: It may seem like a part-time job isn’t important, but learning how to work with customers (and your boss), be part of a team, and be responsible are skills you’ll need to succeed at a job you really want in the future. Don’t downplay where you are: It might not be forever, but it is setting you up for what’s next.
Budgeting
Myth: If you buy coffee every day, you’ll never be a millionaire.
Reality: You might have heard of coffee shaming — where people point out that a $5 coffee feels like nothing each day, but adds up to almost $2,000 on coffee per year. Others tell you to buy that coffee –do what you want, do what makes you feel good. What you need to do is think about what your coffee costs, and decide if it’s worth it to you.
Saving in a Bank
Myth: There’s no point in trying to save when you’re young and barely make any money.
Reality: Saving early — even if it’s not much money — is the key to taking advantage of the power of compounding interest. Suppose you set aside $1,000 a year (that’s about $80/month) from age 25 to age 65, a total investment of $40,000, in an account earning 7% a year. At 65, you’ll have more than $200,000. (If you wait to save that same amount until you’re 35, you’ll end up with a little under $100,000 when you turn 65.)
Investing & Building Wealth
Myth: Don’t miss out on that trendy, social media-driven stock.
Reality: Social media creates hype around specific stocks that drive them temporarily to unsustainable highs. But by the time these “insider” stock tips reach TikTok, the growth is often done, and you’re likely to end up losing money.
Saving in a Bank
Myth: You’re crazy to trust a bank with your money.
Reality: As long as you stash your money in an institution that’s FDIC-insured, the government promises to replace up to $250,000 in the unlikely case that your bank goes belly up.
Credit
Myth: You should get a credit card as soon as you graduate high school (and if you can get one before, even better).
Reality: You need to be ready to pay off your credit card — in full and on time, every month — before you get one. This is why 21 is the legal age to get a card in your own name (which still allows plenty of time to build credit). Also, avoid becoming an authorized or joint user on a parent’s card, if you can. If you do this, your bad credit habits can affect your parents, and their bad credit habits can affect you.