Guest Posting Throughout America’s history, people have been told repeatedly that saving their money is a wise idea. You’ll hear it from everyone, including your mother. According to the American blueprint, it is the most important aspect of success. The description is mythical. America’s system is designed to allow corporations to prosper and to keep individuals in debt, possibly until they are dead. It may sound harsh, but you will be able to make your own judgments after we dispel some myths, check next page.

Myth number one – “Save all your money and you will be able to attend college, receive a quality education and land a high paying job”. A good job and saving money to go to college seem like a smart idea. The American way of life and ideal is to go to college. But why is it so costly and gets more expensive each day? Many students today are required to borrow thousands to fund their college education. In order to earn a college degree that will allow you to enter a profession with higher pay (think attorney or doctor), it is likely you’ll have to take out even more loans and go to school for longer at pricier schools. Before a student can get a first job or receive a paycheck, they often have debts amounting to tens of thousand dollars. It’s great to go to college, but saving for it is not a guarantee of financial success. If you don’t get the job, it could mean many years without a steady income.

Myth number two – “Open up a savings account in my bank to put your money aside for the future”. While the bank can hold and earn interest on your money while it’s in the account, this isn’t the most profitable place for your money. A savings account at most banks offers an interest rate of between 1% – 2%. However inflation is historically closer to around 3% – 5%. Therefore, your money in the bank does not match inflation. Other words, money put in your savings will be LESS valuable tomorrow when it is withdrawn. As if that wasn’t enough, they take all your money while earning anywhere from 5%-30% on it. Meanwhile you only get the paltry 1%. Their investment makes the profit you would have made, and your savings will lose their value as inflation increases.

Myth number three – Get a credit card in order to save 1 – 2 percent or earn frequent flyer mile rewards. While these offers from credit card corporations may seem great, they’re dwarfed when you consider the interest rates you will be paying on purchases. If you spend money on credit cards, instead of saving 1% on each purchase you actually lose 6% to 28.8% on average (depending the the interest rate charged on the card). Although you can pay the entire balance each month – you’ll still have to pay transaction and annual fees. You can avoid fees by paying off your card completely at the month’s end.