Since everyone is involved in personal finance, it is inevitable that the world is full of myths and mistruths about personal finance. So many people are looking for an easy angle and a way to avoid the responsibility of dealing with their finances. Let’s take a look at some common myths and see how true they really are (hint – not very true at all).
1. I’m not 18 yet, so they can’t make me be responsible for my debts
Wrong. Very wrong, in fact. You can’t sign a legal contract before you are 18, so you can’t sign up for a credit card of your own or get a loan. That doesn’t mean that you can run up your bill if you do have a credit card, though. In order for a teen to get a card they need an adult to co-sign. That adult will be responsible for the debt which is racked up by the teen. For most people it would be worse to hang your parents with a debt than it would be to run one up for yourself.
2. It is safer if I don’t sign my credit card
Also wrong. Someone must have thought that not signing your card would protect you from identity theft because the bad guys who got their hands on your card wouldn’t know what your signature looked like. Unfortunately, whoever came up with that theory wasn’t very bright. They won’t know what your signature looks like, but they can just sign it themselves instead. That way, when they go on a spending spree their signature on the bill will perfectly match the one on the card and they will have a whole bunch of new stuff. You will only be left with the bill for all of it.
3. Easy money can be made helping foreigners with their banking problems
Really, really wrong. You may have seen the offer and it probably sounded pretty good. Someone in another country (often Nigeria) is having trouble getting a whole bunch of money out of the country because their government won’t let them remove it. If you will help them by putting the money into your bank account and then letting them transfer it to another account then they will leave behind a big sum of money as a reward for your troubles. So what’s the problem? Well, they want you to give them all of your banking information so that they can put the money in your account and take it out afterwards. The thing is, they just use the information you give them to empty out your account of all of your money and then they disappear so you can’t track them down.