In the last couple of weeks, I’ve found myself cringing at a number of tweets relating to money. Misconceptions, myths and false statements that could resurrect the dead like Pastor Lukau. This is what creates the illusion that money is complex and difficult to understand. So it’s important to address some of these misconceptions.

A big salary will solve all your money problems

Uhm, NO! If you are struggling to save anything from your current salary, it is unlikely that you will save anything with a bigger salary. This comes down to your spending habits and the dreaded lifestyle adjustment trap. Let me explain. The real determinant of your financial well-being is your spending habits and not your salary. What actually matters is what you accumulate, not what you spend. If you hardly saved with R10 000, it is unlikely that you will magically start saving with R15 000. The bigger salary doesn’t fix your poor spending habits; instead it gives you more money to spend and more access to credit. In addition, people also tend to increase their standard of living with the rise of their salary – The dreaded lifestyle adjustment trap.  A bigger salary is followed by a more expensive car, bigger house and more clothes. There is a lot of new spending. So no, a bigger salary won’t solve your money problems if your spending habits remain the same while your lifestyle drastically changes.

That conversations around wealth and money are only for the rich and affluent.

I have learnt that it is wiser to learn a lesson with a R100 than it is with a R1000. You don’t have to wait until you are drowning in debt or you are wealthy to start taking part in conversations about money. In fact, to become wealthy and debt free, you need to start the conversations. Information changes situations. You need to hone your ability to understand how money works in the world. To get to a point where you have the knowledge, skills and confidence to make responsible financial decisions that suit your financial situation. Read financial books, see a financial advisor and get information on financial products. It won’t be easy at first and it will be daunting. In time you will begin to speak the language of money with R100 that you will learn to turn to thousands more.

The creation of a budget is enough

The mere creation of a budget isn’t enough. You have to follow through by staying committed to that budget. Treating it like a financial compass that will help you to direct your finances accordingly.  You will be able to see all your expenses and highlight items that you can start cutting back on, in order to start saving. It will also help you to see if you are living beyond your means and to start taking action.

Where you are financially today, is a sum of every choice you’ve ever made. If you don’t like where you are, start making different financial choices. Start changing your spending habits and start taking a keen interest in where your money is going and growing, by drawing up a budget.