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“Always pray to have eyes that see the best in people, a heart that forgives the worst, a mind that forgives the bad and a soul that never loses the faith in GOD”

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Once upon a time in a lively town, there lived a young man named Abhinav. He was hardworking and ambitious, dreaming of achieving financial success. However, he was surrounded by myths and misconceptions about finance that clouded his judgment.

One day, Abhinav overheard a group of people discussing the stock market. They spoke about how risky it was and how one could lose all their money in a blink of an eye. Abhinav believed this myth and decided to stay away from investing in stocks, fearing the potential losses.

Another time, Abhinav’s uncle shared a tale about a friend who had invested in a mutual fund and lost everything. This story left Abhinav fearful of mutual funds, believing they were a sure path to financial ruin.

Abhinav’s misconceptions did not end there. He often heard people say that saving money was enough to secure a bright future. So, he diligently saved every penny he earned and kept in his safe vault. Believing that one day it will become a big amount. And he was unaware that inflation was slowly eroding the value of his savings.

One day, Abhinav met an old man named Mr. Sharma, known for his financial wisdom. Curious, Abhinav approached him and shared his financial fears and doubts.

Mr. Sharma smiled and said, “My young friend, it’s time to debunk these myths and misconceptions. Let me guide you towards financial clarity.”

He explained that while the stock market could be volatile in the short span of time. But it offered tremendous growth potential in the long run. Diversifying investments into various asset classes and staying invested for the long term could mitigate risks.

As for mutual funds, Mr. Sharma educated Abhinav about the various types, such as equity funds and debt funds. Again in equity mutual funds there are different schemes. Like index funds, large cap funds, mid cap funds, small cap funds, thematic funds, value funds, multi cap funds, ESG fund etc. He showed him that mutual funds were managed by professionals and offered better diversification, making them a reliable investment option.

Regarding saving money only is the first step in financial planning. Mr. Sharma emphasized the importance of investing wisely. He explained that simply stashing money away would not beat inflation and would not help Abhinav achieve his financial goals.

Over time, Abhinav began to understand the importance of financial planning and the need to dispel these myths. He started investing in a mix of mutual funds and stocks, aligning them with his risk tolerance and financial goals. He also learned about tax-saving instruments to optimize his investments.

As the years passed, Abhinav’s investments grew steadily, and he achieved financial stability. The myths and misconceptions that once held him back were now replaced with a clear understanding of financial concepts.

Abhinav continued to learn from Mr. Sharma, and he realized that the key to financial success was not just hard work but also making informed decisions. He resolved to spread financial literacy and debunk these myths for others in his town.

And so, Abhinav became a guiding light for those lost in the shadows of financial misconceptions. With his newfound knowledge, he helped many others achieve financial well-being and lead brighter futures, proving that a solid understanding of finance can change lives and debunk the myths that once clouded their paths.


In the world of finance, myths and misconceptions are prevalent and can lead individuals to make irrational decisions. Here are some common myths in finance:

1. “Investing in the stock market is like gambling”:

One of the most widespread myths is that investing in the stock market is akin to gambling. While there are risks involved, investing in well-researched companies with a long-term perspective can yield significant returns.

2. “Debt is always bad”:

Not all debt is harmful. Taking on strategic debt, such as a mortgage or a business loan, can be a wise financial move if managed responsibly and used for productive purposes. If you are rate of return is higher than cost of debt, definitely should proceed with debts. It will give you benefit of leveraging.

3. “Saving is enough for retirement”:

Relying solely on savings without considering inflation and the need for wealth appreciation through investments can result in an insufficient retirement fund.

Mr. Sharma suggested a simple strategy to built retirement corpus for Abhinav.

Suppose you have Rs. 1,00,000 as monthly expenses multiplied with 12 and it will convert into your yearly expenses as Rs. 12,00,000. Now multiply this annual expenses with 25 which becomes Rs. 3, 00,00, 000 and this three crores of rupees is your retirement corpus. If you withdraw 4% of this corpus annually and assuming amount is compounded with 12% rate of return it will never consumed fully during your lifetime. Even you may pass a good balance of corpus to your heirs.

4. “I am too young to start investing”:

Starting early is one of the keys to successful investing. The power of compounding can significantly grow investments over time. The early you start better it will be for you to become crorepati. Even a small amount of Rs. 100 invested once in the lifetime may grow to rupees two crores after 100 years with compounded annual growth rate of 13%.

5. “Renting is throwing money away”:

While owning a home has it owns benefits. If you are purchasing a house for your consumption means you are staying along with your family, it is a good decision. But renting can be a financially sound decision based on individual circumstances, such as job mobility and market conditions.

6. “Credit cards are bad”:

Credit cards themselves are not inherently bad. It is the misuse and accumulation of high-interest debt that can lead to financial troubles. If you can pay your credit card outstanding at due date it is good. Never come into the trap of minimum payment. In this case you have to pay huge amount of interest.

7. “I do not need insurance”:

Many people underestimate the importance of insurance, whether it is health, medical, or property insurance. Adequate coverage protects against unexpected financial burdens. Before taking any investment decision you must purchase a term plan, which will protect your family at the time of mis-happening. Medical expenses are also very costly so you must insured yourself along with family members.  

8. “Financial advisors are not worth it”:

Some believe that they can manage their finances better without professional advice. However, a qualified financial advisor can provide personalized guidance and help navigate complex financial matters.

Now a day’s financial planning is a specialized profession. There are number of SEBI registered Financial Planner in India who has deep knowledge about the financial products, regulatory guidelines, legal aspects etc. Hence, financial planning can be done only by a professional qualified financial planner.

9. “The more I earn, the richer I will be”:

Earning a high income is essential, but financial success also depends on how one manages and invests that income. In your society you will find lot of people struggling for money or maintain their life. Even though they have earned tremendous amount of money during their job or business. So you are suggested, as you are working hard to earn your money your money should also work to earn more money.

10. “I need a lot of money to start investing”:

With the advent of technology and the availability of Exchange Trade Funds (ETF), it is now possible to start investing with even small amounts below Rs, 100.

11. “I can time the market”:

Trying to predict short-term market movements is a risky strategy and often leads to poor investment decisions. You can built wealth only if remain invested for long span of time. As we used phrase that Rome cannot be built in a day, similarly wealth cannot be created in short term.

12. “I can rely on luck to make money”:

Relying on luck instead of informed decision-making and financial planning is a dangerous mindset that can lead to financial instability.

13. “Financial planning is only for the wealthy”:

This is a common misconception that financial planning is only for those who are wealthy. However, financial planning is relevant for everyone, regardless of income level. It can help people create a roadmap for their finances and make informed decisions about their money.

14.Financial planning is just about investments”:

While investments are a crucial aspect of financial planning, it is not the only focus. Financial planning involves a holistic approach to personal finance, including budgeting, debt management, retirement planning, insurance planning, tax planning, and more.

15.It is only about tax planning”:

Tax planning is only one aspect of financial planning. Financial planning deals with investments, protection and estate planning in addition to tax planning.

16.Financial planning is a one-time activity”:

Some people believe that they only need to create a financial plan once, and they are good to go for the rest of their lives. However, financial planning is an ongoing process, and it needs to be updated and revised as circumstances change.

17. “Financial planning is required near to retirement age”:

One more myth about financial planning is that financial planning has to be thought of only when one is about to reach or nearing retirements. If someone asks what the right time to start financial planning is, the answer would be yesterday. That means it should be done at the earliest, as soon as one starts earning money or gets her/her first job.

18.Financial planning is too complicated”:

People often assume that financial planning is too complicated and overwhelming, which leads them to avoid it altogether. However, financial planning can be broken down into smaller, manageable steps, and there are professionals available to help guide the process.

19.Financial Planning is not necessary if you have a steady income”:

While having a steady income is an essential component of financial stability, it does not mean that financial planning is unnecessary. Financial planning can help individuals maximize their resources, plan for unexpected expenses, and create a plan for long-term financial security.

20.Financial planning is expensive”:

While there may be costs associated with financial planning, the benefits of having a plan in place far outweigh the costs. A good financial planner will work with you to create a plan that fits your budget and goals.

It is crucial to dispel these myths and gain a solid understanding of financial concepts to make informed and rational decisions about money management and investments. Seeking guidance from financial experts and conducting thorough research can help individuals build a strong foundation for their financial future.



Overcoming myths in finance requires a combination of education, research, and critical thinking. Here are some steps to help you navigate and dispel financial myths:

1. Educate Yourself: Take the initiative to learn about personal finance and investment concepts. Read books, articles, attend seminars, and follow reliable financial websites to build your knowledge.

2. Consult Trusted Sources: Seek advice from certified financial advisors or experts who can provide unbiased and well-informed guidance. Rely on credible sources for information and avoid falling for sensationalized or misleading claims.

3. Understand Risk and Return: Learn to distinguish between risky investments and scams. Understand that higher returns usually come with higher risks, and there are no guaranteed get-rich-quick schemes.

4. Question Everything: Be critical of financial advice and claims that sound too good to be true. Ask questions and research thoroughly before making any financial decisions.

5. Diversify Investments: Avoid putting all your money into a single investment or asset class. Diversification helps spread risk and protect your portfolio from significant losses. As the legendry investor Mr. Warren Buffett says, “Do not put all your eggs in one basket”. Follow this technique to mitigate your risk.

6. Set Realistic Goals: Understand your financial goals and risk tolerance. Avoid comparing your investment choices with others without considering your unique circumstances. While fixing your goals always these should be realistic, achievable and time bound.

7. Monitor and Review: Regularly review your investments and financial plans. Stay updated with market trends and economic developments to make informed decisions.

8. Avoid Emotional Decisions: Emotions can lead to impulsive decisions. Stay disciplined and avoid making hasty changes to your investment strategy based on market fluctuations.

9. Learn from Mistakes: Acknowledge past financial mistakes and learn from them. Mistakes are part of the learning process, and they can help you improve your financial decision-making.

10. Create a Financial Plan: Develop a comprehensive financial plan that aligns with your goals and risk tolerance. A well-thought-out plan will give you a clear roadmap for your financial journey.

11. Practice Patience: Building wealth and achieving financial goals take time. Avoid chasing quick returns or making drastic changes to your investments based on short-term fluctuations. Having patience and keeping discipline while investing are two main requisite. If you have these two characteristics in your investing journey no one can stop you to become wealthy.

12. Seek Support from Family and Friends: Engage in discussions about personal finance with family and friends but only with those who understand it. Sharing knowledge and experiences can help you collectively overcome financial myths.

Remember that financial education is an ongoing process, and staying informed is essential to make sound financial decisions. Be open to learning, remain curious, and seek advice from trusted professionals to overcome myths and build a strong financial foundation.



The information in the Blogs are purely informational and for education purpose. The article should be treated as informational and not an advisory to invest. Matta & Matta (Advocates, Solicitors and Consultants) and the Authors are not liable for any losses caused as a result of decisions based on the blog. Matta & Matta advises users to check with certified financial planner/experts who are SEBI registered before making any investment decision.

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