Twinkies can survive a nuclear war, Vikings wore horns on their helmets. Time is money.
Whether it is a dessert cake, Norse history or personal finance, there are many common misconceptions people do not question. Grant Sabatier, author of "Financial Freedom: A Proven Path to All Money You Will Ever Need", wants to dispel three money misconceptions that are holding you back.
Sabatier says changing his relationship with money allowed him to go from $2.26 in his bank account to over $1 million in just three years .
Time isn't money after all
The phrase "time is money" is everywhere, from popular music to obnoxious Twitter bios of your first year finance bros.
Sabatier has a different take: "Money is actually infinite, your time is not."
Many of us trade our time for money (think about how long you commute to work each day). While our time is finite our earning potential is limitless.
There are two ways to break this cycle, according to Sabatier. You can start your own business (a time-consuming and often arduous process that may not actually earn you any money), or you can start investing now.
The advent of index funds — mutual funds and now also exchange-traded funds that let investors access a broad group of stocks without having to make individual stock picks — pioneered by Vanguard Group, has made passive investing available to the masses. In fact, investing in an index fund that tracks the S&P 500 group of 500 large U.S. stocks, has an annual return of about 7%.
The Oracle of Omaha, Berkshire Hathaway chairman and CEO Warren Buffett, made $1.5 million in his sleep last year.
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Saving income is really hard
Here is some good news. "If you save 50% of your money you can retire in 15 years or less."
Here is the bad news, according to Sabatier: Saving 50% of an income is not realistic for a lot of people. However, you should save a portion of your income.
Sabatier believes budgeting reinforces a scarcity mindset and claims he has never used one. (Most financial experts do recommend a budget.)
Coffee is not the critical decision
Sabatier says obsessing over little, daily purchases is less important than reducing costs on your biggest expenses.
There are many financial know-it-alls out there who will tell you that your morning coffee is robbing you of millions of dollars. They're missing the point, according to Sabatier. A $3 latte won't add years onto your career. Instead, look to reduce the cost of your rent, food bill and transportation. Your latte will taste the same in smaller apartment.
Check out What entrepreneurs like Daymond John and Ryan Serhant learned about money from summer jobs via Grow with Acorns+CNBC.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.
