25 Myths You've Got to Avoid if You Want to Manage Your Money Right

"But any dollar you choose to spend is a dollar you can't save, so think long and hard before you crack open your wallet."

"Everybody knows that corporations feel little loyalty toward their employees, so we all need the financial wherewithal to survive a prolonged period of unemployment."

"Stocks are undoubtedly risky, if you define risk as the chance of a large short-term loss. But if you are a long-term investor, there's a lot more to fret about than just market gyrations, and arguably short-term losses are the least of your worries."

"Companies may briefly enjoy superior earnings growth and superior profit margins and that catches the attention of investors, who are a little too quick to believe that this advantage will persist."

"Very few investors manage to beat the market. But in an astonishing triumph of hope over experience, millions of investors keep trying."

"You aren't likely to earn 10 percent a year over the long haul. You may not even come close."

"I have come to realize that the reality of fund investing just doesn't live up to the promise."

"I think it is possible to identify winning stock-fund managers. But it's a lot more difficult than we are led to believe and I am not sure it is worth the effort."

"Index funds are tough to get excited about. But I love them just the same."

"Bonds suck investors in with their fat yields, then bludgeon them with inflation, taxes, defaults, early redemptions and more."

"Over the long haul, most hard assets will generate gains that roughly match the rising inflation. Hard assets, however, won't rise in lockstep with inflationary increases."

"What's wrong with the traditional balanced portfolio? The mix of 60 percent stocks and 40 percent bonds is unnecessarily volatile and, for many investors, it's way too conservative."

"The truth is, brokers are trained primarily to be good salesmen, not good investment advisers."

"Everybody should have some emergency money. This much I concede. But what about the received wisdom, which says you should have six months of living expenses sitting in a savings account or a certificate of deposit? I think it's utter bunk."

"Going into debt is awful. Not going into debt can be even worse."

"Sure, a home does provide its owners with shelter and a pleasant sense of pride and security. But a house isn't a vibrant part of the economy. It doesn't grow."

"Have you been told that you should never, ever, ever pay down your mortgage? It's time somebody put you right."

"Here's a sampling of policies to avoid, either because they are bad policies or because they might not be right for somebody in your situation."

"For most folks, there just isn't much value in cash-value life insurance. So do yourself a favor. Hang on to your cash."

"The financial-aid system is an abomination desperately in need of reform, not least because the system penalizes parents who save for college by putting money in their children's names."

"Individual retirement accounts and other tax-sheltered savings vehicles bring with them a fistful of headaches. Here are four major drawbacks."

"If you are determined to leave a bundle to your kids or to charity, you can probably do it. It's not going to happen, however, if you don't think ahead, unpleasant as that may be."