Myth 4: Taking a Loan with the Lowest Interest Rate Would Be a Good Idea

Are you thinking of taking a bank loan to buy a car? Lenders will offer you loans with different terms and conditions and the lowest interest rate may attract you the most. The flat rate of interest is a widely used trick which creates a financial illusion that you will be charged less. The flat rate is calculated by dividing the total interest paid on the loan by the number of years. A flat rate of 10 percent will obviously appear lower than a normal reducing rate of 12 percent. What you don’t realize is that in flat rate you will be charged for the entire loan amount even though the outstanding amount reduces progressively with every EMI; hence it’s not a best deal at all.

Myth 5: Buying Gold Is an Investment

You may think buying gold jewelleries could be a good investment. But you must not forget that jewellery at the end of the day is your personal belonging and due to sentimental value attached you may not agree to sell it at once hence your so called gold investment will lose its flexibility. Also most jewellery is not made with 24 karat gold but with 18 & 22 karats and its designs involve hefty making charges too.  If you think comparing it with the day’s price as most markets display for 24 karat gold will show a rise in your wealth then you could be wrong as  the value of your jewellery will ultimately depends on the jeweler buying it.