Nicole Spector

Mon, May 12, 2025, 11:04 AM5 min read

Most of us didn’t learn much about personal finance growing up, and one of the many abysmal side effects of that is believing in money “facts” that it turns out are straight up myths. These myths don’t just make you sound foolish at dinner parties; they can render serious harm on your finances and hold you back from wealth-building opportunities.

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Let’s consider five money myths that financial experts see running rampant in our society — and get some insight as to why they’re nonsense.

These days, you can start investing with as little as $1 without even moving from your couch, yet people still fall for the old and tired myth that you need a lot of money to be able to invest.

“This myth keeps so many people from investing, which can lead to years of missed opportunity,” said Victor Wang, CEO at Stockpile. “They either think they don’t make enough money, that investing is only for millionaires or even that they can’t start until they get another raise or promotion. But investing is a good idea at any income, and the most important thing is to just get started.”

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The precise origins of the phrase “cash is king” are unknown, but the phrase started picking up steam after the stock market crash of 1987, when it was said by Pehr G. Gyllenhammar, then CEO of Volvo. You should always have some cash readily available in a bank account to cover routine expenses, and more cash set aside in a high-yield savings account for emergencies, but it’s a costly mistake to keep more cash than that.

“Over the long run, holding significant amounts of cash ensures that one will suffer significant opportunity losses,” said Robert R. Johnson, PhD, CFA, CAIA, professor of finance at Heider College of Business, Creighton University and chairman and CEO at Economic Index Associates, who recommended investing in a diversified portfolio of common stocks to build wealth. “Someone with a long time horizon should not have exposure to money market instruments, yet many investors do because they fear the volatility of the stock market. Time is the key to successfully building wealth because of the effect of compound interest.”

We’ve all heard from economist after economist that we cannot time the market, and yet some of us still buy into the myth that we, being oh-so special and smart, can time the market.