Money myths about investing and saving
Many of us grow up with money beliefs that can shape how we save and invest. Some of these beliefs were passed down with good intentions. Others are outdated. And some may be quietly holding you back. Money confidence isn’t something you either do or don’t have. It’s something you build over time. Here are five common myths that may be holding you back, and what to know instead.
Myth 1. “Investing is too risky”
It’s understandable to feel cautious about investing. Markets rise and fall, headlines can feel dramatic, and no investment is guaranteed. But avoiding investing altogether can carry its own risks. Over time, inflation can reduce what your money can buy, which means cash may not always hold its value in real terms.
There is a range of investment opportunities to suit different investment styles and risk appetites. Many people start with broadly diversified investments, including some exchange traded funds (ETFs) that spread money across different assets, industries and markets.
What to know instead: Risk matters, but so does doing nothing. The right level of risk depends on your goals, timeframe and comfort level.
A small next step: Not sure about your risk appetite? Take our free Investor Style quiz and find out.
Myth 2. “I need a lot of money to start”
This belief stops more people than almost anything else. You do not need a windfall, a bonus, or the “perfect moment” to begin building wealth. Starting small and starting consistently can be powerful over time.
Even modest regular contributions can help build momentum and create habits that last.
The amount matters less than the habit. Thanks to the rise of simple accessible investments and online trading platforms, investing is now more accessible than ever. Take advantage of it.
What to know instead: Starting matters more than starting big.
A small next step: Look at what feels realistic for you right now. It might be a small weekly or monthly amount. Most investing platforms offer Automated regular investing tools – at Vanguard it’s called Auto Invest (and it’s free).
Myth 3. “I’m just not good with money”
Many of us carry this story around for years. Usually it doesn’t come from facts. It comes from lack of confidence, lack of exposure, or feeling like everyone else somehow understands money better. They don’t.
Money skills are learned. Budgeting, investing, planning, asking questions, comparing options. None of these are personality traits. You do not need to be naturally gifted. You just need to begin.
A historic study by Brad M. Barber and Terrance Odean, called Boys Will Be Boys: Gender, Overconfidence and Common Stock Investment, analysed male and female investing behaviour across 35,000 brokerage accounts. The women outperformed, with men earning annual risk-adjusted net returns of 1.4 percent less than those of females. More recently, a 2018 study by Warwick Business School of 2800 investors found that women outperformed men at investing by 1.8 percent. So don’t sell yourself short.
What to know instead: Confidence often comes after action, not before it.
A small next step: Choose one area to improve this month. Super. Budgeting. Investing basics. One step is enough.
Myth 4. “I’ll start when I earn more”
A higher income can absolutely help. But waiting for the perfect salary can turn into years of delay. Financial progress is often built through habits long before big income jumps arrive.
Saving regularly. Reviewing spending. Learning the basics of investing and super. Making extra super contributions when possible. Investing consistently.
These behaviours can begin at many income levels.
What to know instead: More income can help, but better habits matter too.
A small next step: Choose one action that fits your current budget. It could be saving a small regular amount, reviewing spending, or learning one investing basic this week.
Myth 5. “My super will take care of itself”
Super can feel easy to ignore because retirement seems far away. But for many of us, super may become one of our biggest long-term assets. Small decisions made now can have a meaningful impact later.
That might include checking fees, reviewing investment options, consolidating accounts, or making extra contributions if it suits your situation.
You do not need to obsess over it. But it is worth paying attention to.
What to know instead: A few simple check-ins over time can make a real difference.
A small next step: Spend 15 minutes reviewing your super this month. You can use our Super Compare Tool to check fees, performance and investment options to see how your super fund stacks up.
A better money story starts now
You don’t need to know everything before you begin. Confidence is something that can build gradually over time through learning, experience and small steps forward.