The Financial $tuff They Don’t Teach You in School

The Truth About Tax Refunds and Withholding

A large tax refund may feel like a bonus, but it actually means you’ve given the government an interest-free loan. Ideally, your tax withholding should be adjusted so that you neither owe a significant amount nor receive a huge refund. It’s all about better cash flow throughout the year.

Marginal Tax Brackets Misunderstood

Many people avoid raises or extra work out of fear they’ll be “taxed more.” While higher income can push you into a new tax bracket, only the income above that threshold is taxed at the higher rate, not your entire income.

Buying vs. Renting a Home

Buying a home isn’t always better than renting. While ownership can build equity, it also comes with maintenance costs and responsibilities. Renting may be a smarter move for those with a mobile lifestyle or short-term plans in a specific city. Owning property, whether a primary residence or a rental, is not risk-free. Repairs, vacancies, and market downturns all affect your return. When considering real estate, understand your goals: are you buying to live, rent, or flip?

“I Don’t Make Enough to Invest” Is a Myth

You don’t need a high income to start investing. Small, consistent contributions, especially when made early, can grow significantly over time. Focus on building the habit and aim to save a percentage of your gross income, even if it’s just 5–10% to start.

Estate Planning Isn’t Just for the Wealthy

Everyone should have a basic estate plan. A will, medical directive, and power of attorney are essential, especially if you have children. Without them, decisions may be made by the courts, not your loved ones.

Politics and Investing Don’t Mix

Many assume that their political party is “better for the economy,” but data shows markets perform well regardless of who’s in office. Letting political beliefs drive your investment decisions can lead to unnecessary anxiety and missed opportunities.

Retirement Spending and the 4% Rule

Rules of thumb like needing 75% of your income in retirement or withdrawing 4% annually can be helpful, but they’re not one-size-fits-all. A better approach is customized planning based on your real expenses, debt, savings, and health needs.

Your Feelings Aren’t Data

Many people “feel” a market crash is coming or that the economy is worse than it is. But emotion-driven investing can be dangerous. Rely on data, not headlines, and work with a financial planner to keep your decisions grounded in reality.

Understanding the Financial $tuff You Don’t Learn in School

Understanding the financial basics they don’t teach in school can make a meaningful difference in your long-term success. By challenging common misconceptions and approaching decisions with clarity and confidence, you can better navigate everything from taxes and investing to housing and estate planning. If you’re ready to take control of your financial future, consider working with a fee-only financial advisor who can help guide you every step of the way.