11 Truths About Money Everyone Should Know

Do you want to learn about money? Here are some important things about money that can help you, no matter how old you are or where you are in life.

I have been interested in personal finance for over a decade now. I’ve learned a lot about money, investing, and the psychology behind money.

I have a bachelor’s degree in economics and a master’s degree in corporate finance. I read blogs, I listen to podcasts, and I devour books like my life depends on it. It has taken me a good while to learn these truths about money and implement them.

1. Money Takes Time To Grow

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Compound returns are the holy grail of personal finance, (s)he who finds it will reap the benefits of it. It takes time, however, to put this to work.

It means the best moment to start is yesterday and the second-best moment is today, so set up your investment accounts and start investing.

It may be tempting to wait until you know everything and feel 100% comfortable. If you start before you’re ready, your future self will thank you.

2. Time Is More Important Than Money

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The second truth about money I realized is that time is more important than money.

When I was studying, and money was barely present in my life, money was more important than time. That’s the reality when you need money now. I would do anything to earn a little more income. I worked night shifts, participated in medical experiments, filled out online surveys, and more. All while studying full-time.

Now I don’t do anything anymore to get a little extra money. I appreciate my time, as well. I enjoy reading books. I enjoy writing. I enjoy spending time with my friends and family. That’s what I spend my time doing, instead of working more hours.

3. Being Rich Is About Earning And Spending

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Lots of people have the potential to become a millionaire when they are patient and determined to succeed.

If you’re not currently in a place of inheriting a large sum of money or selling your company for a considerable lump sum, I’m right there with you. No worries.

Becoming financially independent is a marathon, not a sprint. It’s important not to spend more than you earn, take on minimal debt, and get your money habits in check.

4. Small Habits Can Have Big Impacts

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Saving can be easy and painless when you try to change your small daily habits where you can and set yourself up for success.

5. Money Buys You Options

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Indeed, money can’t buy you happiness. But money can buy you options or experiences that make you happy. When used in the right way, money can provide comfort and stability.

Ultimately, knowing what you value and knowing what you want to spend your money on can be the most comfortable zone to be in.

6. Pay Yourself First

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There is a reason why many people recommend paying yourself first – because it works!

You put your savings and investments away before you are paying any other bills. The money automatically gets transferred into the designated accounts, and you won’t even know you had it!

After you’ve transferred this fixed amount into your other accounts, you can start paying your bills. Whatever is leftover is what you get to spend.

7. Following Your Passion Isn’t For Everyone

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Few people on this planet are lucky enough to pursue their passion in their everyday working activities. Even then, they will have bad days where they want to watch Netflix all day.

One thing to be wary of is not to go and work in a job you hate to live for the weekends. Try and strive to be among the lucky few, and find a way to get your passions involved in your day job. 

8. Think About Costs Per Use

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I’ve bought quantity over quality for the longest time, and it has not done much for me. That’s why I’ve been selling and donating the things that I don’t like, don’t need, or don’t bring me joy.

When you doubt whether or not you should buy that blouse that you will wear to a wedding, think about the cost per use? If you’re not going to wear it on any other occasion, it’s probably a waste of your money.

9. Investing Is Not Complicated

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For me, that is one of the most crucial money truths that I’ve learned over the past years. Investing is not complicated! People want to start investing and immediately dive into individual companies. They get overwhelmed and don’t know where to look, don’t know how to diversify, and opt-out again.

Luckily there is a straightforward solution for that: invest in low-cost index funds. No need to manually diversify. Everything is taken care of, just create your investment account and start investing.

10. Giving Gives Joy

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Generous people are healthier, happier, less stressed, and have deeper relationships with others, as was found by this study. What can we take from that? Giving to others gives you joy.

If you can give money, give money. If you can give time, give time. Find an organization that’s close to your heart, give from your own initiative, and reap the benefits!

11. Keep It Simple

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One final thing that you should keep in mind: keep it simple. This is truly the way to keep up with what you want to do, not feel overwhelmed, and make things easy for yourself.

Think about areas in your life you could simplify for yourself, areas that are taking up a loss of your energy, and essential areas for you. These are the areas where you can get the most benefit out of it.

What are your most significant truths about money you’ve learned?

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