Editor|| Sindhu Gannavarapu
It’s a Sunday lunch at the Sharma household in Delhi. The dining table is covered with steaming rajma chawal, but the conversation, as always, turns to money.
“Beta, buy a home,” says Uncle Rajiv between spoonfuls. “It’s the safest investment. Look at Noida! Property never goes down.”
Across the table, Aunt Neeta adds, “And gold… gold never loses its shine. You can always count on it. Not like these risky shares.”
In the corner, cousin Rohan mutters, “Renting is just throwing money away. At least when you own, you’re building something for yourself.”
We’ve all heard these lines. Some of us have even given them. But in an era where asset prices swing with global interest rates, pandemics, and technology shifts, these old truths deserve a fresh look.
Myth 1: Buy a home — it’s the safest investment.
Between 2019 and 2024, property prices in some Indian hotspots soared — Noida up 152%, Greater Noida up 98% (Anarock data). But this isn’t uniform. Cities like Kolkata and Ahmedabad saw much slower appreciation, often barely beating inflation.
The “property never goes down” belief took a beating in 2008. The U.S. housing market collapsed by over 20% nationally and by 40–50% in overheated states like Nevada and Florida. Japan’s property prices are another cautionary tale — after peaking in 1991, they fell for nearly two decades. Even in London, Knight Frank’s 2024 report shows prime central London prices have fallen by 17% in real terms since 2015.
Rising interest rates in developed markets (U.S., EU, Australia) have slowed housing demand sharply. In India, while urban housing is still in an upswing, increasing home loan EMIs and government pushes for affordable housing could cap speculative gains. Global property cycles are becoming shorter and sharper — making timing and location more important than blind faith.
Myth 2: Gold never loses its shine.
Gold remains a cultural and financial staple. In FY 2024–25, it returned 33% in INR terms, beating equities and debt. Over the past 20 years, gold in India delivered ~10% CAGR, acting as an effective inflation hedge.
In USD terms, gold’s story is more volatile. From 2011 to 2015, gold fell nearly 40%. In inflation-adjusted terms, gold still hasn’t matched its 1980 peak. For example, $850/oz in 1980 is equivalent to ~$3,000/oz today, but gold only touched ~$2,450 in 2024. Meanwhile, in countries like Turkey and Argentina, gold has been a savior — in 2023, as the Turkish lira collapsed, gold prices in lira terms jumped over 70%, preserving purchasing power when cash burned away.
With global central banks (especially in China, India, and Russia) increasing gold reserves as a hedge against dollar volatility, gold’s long-term demand looks solid. However, rising digital asset adoption, like tokenized gold and central bank digital currencies (CBDCs), could change how gold is used and valued.
Myth 3: Renting is throwing money away.
In many Indian metros, rental yields are just 2–3% annually, far lower than home loan interest rates (8–9%). For example, buying a ₹3 crore apartment in Mumbai’s Bandra could mean EMIs over ₹2.3 lakh/month, versus ₹1.2 lakh in rent — leaving significant surplus cash for investment elsewhere.
In cities like New York, San Francisco, or Sydney, renting has often been financially smarter over the past decade. In 2023, CoreLogic data showed Sydney’s median house price was 13x median income, far beyond affordability thresholds — renting allowed residents to invest elsewhere with higher returns. In Germany, a nation with one of the highest renting populations (over 50%), strong tenant rights and stable rental markets have made renting a respected long-term choice.
With work-from-anywhere trends and rising mortgage rates, flexibility is becoming a financial asset in itself. Global investors are also piling into “build-to-rent” projects, signaling that renting will become more structured, secure, and service-rich — challenging the stigma that renters are “wasting money.”
Myth 4: The Stock Market is Gambling
Data Check: In India, the Nifty 50 has delivered 11.5% CAGR over the last 20 years, turning ₹1 lakh in 2004 into over ₹9 lakh by 2024 — without any active trading. In the US, S&P 500 20-year rolling returns have never been negative since the 1920s, showing that time in the market beats timing the market. Equity mutual funds in India have consistently outperformed fixed deposits (which yield 5–7% CAGR) over 10+ year horizons.
Speculation and short-term bets are gambling, but disciplined, long-term investing — diversified and held for years — is a proven wealth-building tool across markets, from Mumbai to New York.
Myth 5: Debt is Always Bad
Data Check: World Bank research shows that countries with higher, healthy credit penetration often see faster GDP growth, as debt funds productive investments. A ₹10 lakh education loan at 8% interest in India can finance an MBA that increases annual salary by ₹8–10 lakh — a break-even in just over a year. Globally, the same logic fuels student loans for high-ROI degrees like medicine, law, and tech. Corporate leaders use debt strategically: Reliance Industries raised billions through bonds to build Jio, Apple Inc. carried over $100 billion in debt in 2023 — not due to lack of cash, but because low-interest debt is cheaper than using equity.
Bad debt (high-interest credit card balances, payday loans) can sink you. Good debt (education, business expansion, affordable home loans) can be a wealth accelerator when managed responsibly.
Myth 6: Higher Income Means More Wealth
Data Check: In the US, 40% of households earning over $100,000 live paycheck-to-paycheck (LendingClub, 2023). In India, someone earning ₹50 lakh annually but spending ₹48 lakh is no wealthier than someone earning ₹10 lakh and saving ₹4 lakh. Global examples abound — from NBA athletes in the US to Indian cricket stars in the 1990s — who earned crores but went bankrupt due to poor money management.
Wealth is not what you earn, but what you keep and grow. High income without disciplined saving and investing just fuels lifestyle inflation, not financial freedom.
How Cultural Narratives Shape Our Financial Choices
Money myths stick because they’re rooted in psychology and tradition, not just numbers.
1. Confirmation Bias – We believe what past experiences confirm. Parents who saw property triple in the 1990s reinforce “real estate never loses,” ignoring recent flat prices in Gurugram or Pune. Americans trust “stocks always go up” after a decade-long bull run, while older Japanese investors still fear equities after the 1989 crash.
2. Herd Mentality – If everyone’s doing it, it feels right. Gold buying surges during weddings/festivals as entire communities purchase together. Cultural bias for property ownership created ghost cities. Crypto FOMO in 2020–21 was amplified by social media hype.
3. Emotional Comfort – Simple rules beat complex truths. “Gold is safe” or “Renting is waste” feels reassuring, even if renting + investing beats buying in Mumbai. “College is always worth it” persists in the US despite $1.7T in student debt and poor ROI for some degrees.
4. Intergenerational Advice – Old rules in a new economy. In the 1980s, 12% home loans and cheap gold made “buy property, buy gold” sound logic. Post-war housing booms made homeownership a default goal. Property optimism outlasted the 1990s crash. Myths endure because they offer belonging and certainty — even when the data says otherwise.
Replacing Myths with Modern Frameworks
The antidote to myths is a three-step approach:
Evidence → Context → Decision
1. Evidence – Look at historical and current data, not anecdotes.
2. Context – Apply it to your age, goals, and risk appetite.
3. Decision – Act based on fit, not fear or social pressure.
The Big Picture — Myths Meet Modern Reality
These money myths are not baseless — they are echoes of eras when they were mostly true. In post-liberalization India, property could double in five years. In the Bretton Woods aftermath, gold was king. In an era of job-for-life stability, buying a home young was logical.
But in 2025 and beyond, asset returns are globalized and interconnected. U.S. interest rate hikes can cool Mumbai property demand; Chinese gold buying can boost your jewelry’s value; a rental market reform in Germany can inspire Indian housing policy.
The lesson? Context beats cliché. The “safest” investment is not an asset class — it’s a strategy that fits your financial goals, market realities, and global trends.
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