9 Alternative Facts Our Parents Told Us About Money — and the Honest Truth
“Dad, how fast can elephants run?”
“Oh, about 45 miles per hour.”
That’s an actual conversation one of our writers once overheard at the zoo.
That’s about the time she began to realize everything our parents tell us isn’t necessarily true.
This exchange about elephants’ running abilities — which overshot their actual speed by about 300% — makes us realize there are probably more of these lies, er, “stretches of the truth” coming from our parents.
If you’re a millennial who frequently sought your parents’ advice, you might still believe a lot of these money myths, too…
1. Banks Are Evil
You left college and entered the job market just as everything came crashing down. Everyone you knew blamed it on the banks — something about bad loans and Ryan Gosling, maybe?
Big banks gave the whole system a bum rap. If you’re looking for something better, we found a bank with a heart — no kidding.
With Aspiration’s Summit checking account, you’ll do all your banking online, which saves a ton of paper and space — we like when our money is green 😉
Plus, the account pays up to 1% APY, which is about 100 times more than a typical checking account. And you’ll never pay to use an ATM anywhere in the world.
The real heart of this bank, though? It helps you support your favorite cause. It donates 10% of its revenue to charity, and you can easily set up automatic donations from your account to contribute on your own.
If you’re ready to make the switch, here’s the link to sign up to open an Aspiration account.
2. If You Don’t Have an Office, You Don’t Have a Real Job
When our parents were growing up, concepts like remote working, telecommuting and the gig economy didn’t exist.
The technology that makes them possible didn’t either.
So we understand why our parents think people who work from home don’t really work. But millennials know better.
We do everything online — from dating and paying bills to ordering food. So why should working be any different?
Demand for ride-sharing has been growing like crazy, and it shows no signs of slowing down. To be eligible, you’ll need to be at least 21 years old with a year of driving experience, pass a background check and own a car made in 2007 or later.
Best of all, he does it on his own time. You can work days, nights or weekends — it’s up to you!
Because it’s easy to switch between apps, Lyft drivers often also sign up to drive with Uber.
As a partner driver with Uber, you’re an independent contractor. You set your own schedule and drive as much or as little as you want.
If you want to give it a try, here are a few things to keep in mind: You must be at least 21 years old, have at least one year of licensed driving experience in the U.S. (three years if you’re under 23 years old), have a valid U.S. driver’s license and pass a background check.
Finally, your car must be a four-door, seat at least four passengers (excluding the driver), be registered in-state and be covered by in-state insurance.
3. Credit Cards are Evil
Many millennials believe credit cards are evil — a wariness we suspect was passed on by their parents.
Used responsibly, though, credit cards are far from evil — they’re a helpful financial tool.
The plastic cards build your credit and simplify budget tracking. Many also offer cash-back or travel rewards.
That said, we know credit cards aren’t for everyone. If you won’t use a credit card responsibly — only charging what you can pay off each month — then your parents were right: You should avoid credit cards for now.
If you’ve been foiled by credit cards in the past, there’s still hope for you.
You can use Credit Sesame to see your credit score and make a plan to pay off credit card debt.
The free app’s “credit report card” makes your credit history easy to understand, and its custom recommendations can help you figure out how to get out of even the worst debt situations.
4. Writing Checks Is Safer Than Using Plastic
No one writes checks in public anymore, except your grandmother and — you learned too late — the woman in front of you in line at the grocery store.
When you ask your mom why Grandma won’t put away the checkbook and swipe a debit card, she says, “It keeps her information secure.”
And you’re thinking, “Does she know she’s handing over a piece of paper with her name, address, routing number and checking account number in plain sight?”
The only thing missing is her mother’s maiden name.
On top of that false sense of security, writing checks can give you a false sense of your balance, too.
If you’re writing checks and not keeping immaculate records in your teeny wallet ledger, you can easily miss a transaction or two and overspend. Then you’re hit with a negative bank balance and overdraft fees — or a bounced check.
If you want to keep your finances secure and orderly, don’t be afraid to use plastic. Just protect your information.
Credit Sesame helps you avoid identity theft by keeping a watchful eye your finances. (Yeah, it does that, too.)
Credit Sesame’s free identity theft protection will alert you to important changes in your credit report (like someone trying to apply for credit in your name), and it offers $50,000 in identity theft insurance.
Isn’t that better than counting on Jim at the grocery store to keep his prying eyes off your personal info?
5. You Absolutely Must Go to College
The key to a successful life, according to our parents?
But college isn’t always the answer. It costs more than ever, and doesn’t always provide a return on your investment.
Everyone should explore alternatives, like apprenticeships, trade schools and coding bootcamps before going into debt for higher education.
If you’re already battling student loan debt, think about refinancing. You can consolidate your existing loans into one with a more manageable interest rate and monthly payment.
A good resource is Fiona, which can help you borrow up to $35,000 (with no collateral needed) and compare interest rates from several lenders.
6. Only Rich People Need Financial Advice
Your parents always managed their own money and did their own taxes, so you assume accountants are just for rich or lazy people.
But anyone can benefit from a little financial guidance.
We’re not talking about pricy financial advisors — though, depending on your situation, we’re not against them.
Instead, we’re talking about a free app: MoneyLion is an all-in-one app for managing your personal finances.
Basically, it offers the financial services you’d typically get from three or four different banks or providers, and they’re all bundled into one place.
MoneyLion connects with all of your bank, credit card, student loan and other financial accounts. Based on your income and spending patterns, it offers personalized advice to help you save money, reduce your debt and improve your credit.
One of our favorite things about this app is the rewards feature.
Targeted at the financial middle class, MoneyLion offers rewards to help you develop healthy financial habits. The rewards program gives you points for taking actions like:
- Connecting a bank account.
- Signing up for credit monitoring.
- Paying your bills on time.
- Keeping your credit utilization low.
The points can be redeemed for gift cards to retailers like Amazon, Apple and Walmart. It’s like giving American Express-style rewards to middle-class customers who may not have a points-earning credit card.
7. You Should Stay at One Job Forever
Back in our parents’ day, staying loyal to one company meant raises and promotions, gold watches and paperweights, sometimes even a pension.
So it made sense.
But today, those perks are few and far between, and hopping jobs is the norm.
You shouldn’t move around too much — and should probably stay at each position for a year or more — but it’s perfectly normal to change companies or careers.
Not only will you stave off boredom, you’ll also gain new connections and skills at each company.
8. Insurance Is More Expensive for Red Cars
We don’t know where this myth came from, but nearly everyone’s heard it — and nearly everyone still believes it.
The thing is: It’s total baloney. Your car’s color has no effect on your insurance.
“You may have heard the color of your car is used in calculating car insurance rates, but this is something we don’t even ask for when you get a quote from us,” Progressive Insurance spokesperson Ron Davis told us.
What does affect your rate?
Primarily, it’s based on your driving record, age and driving experience. But there are a few factors that might surprise you — like marital status, sex, your car’s make and model, and more.
9. You Should Get an Oil Change Every 3,000 Miles
Yup, this is a myth.
It was true back in the day, and still remains true for some old cars. But the majority of cars on the road today can go nearly 10,000 miles without an oil change.
Check your vehicle’s manual to see what’s recommended — you could end up saving hundreds of dollars on oil changes.
You know how your parents said you can’t believe everything you read?
Well, turns out you can’t believe everything they said, either.