Financial Myths to Avoid

iStockphoto / We all know, money doesn't grow on treesThere are common mistakes about money that may be getting in the way of your monetary success. Financial expert Andrés Gutiérrez shares some "baby steps" for getting out of the financial hole.

Whether you were born and raised in this country or immigrated from another part of the world, the importance of responsible financial planning in the midst of a troubled economy is probably not lost on you. In the process of trying to establish a stable income and reach ambitious goals, some are given false information or incorrect advice. We asked financial expert and creator of the Paz Financiera seminars, Andrés Gutiérrez, to help us divide fact from fiction to find out what it really takes to make our money work for us.

Bounce back from a foreclosure

Gutiérrez finds that first generation immigrants tend to be guided by three major misconceptions:

  • · MYTH #1 - It's easy to make money in the US: Most of us know by now that it takes hard work to become well off in this country, but it's not impossible. After all, first generation immigrants are four times more likely to become millionaires than those who are US-born. You just have to understand that it won't happen overnight
  • · MYTH #2 - You must establish credit in this country: There's a pervasive notion that you're "nobody" until you have credit. As a matter of fact, according to Gutiérrez, misled Hispanics "tend to have credit cards as a status symbol rather than saving money." Gutiérrez suspects that the credit debt among Hispanics, along with overly priced mortgages may account for the high rate of foreclosures in the Latino community.
  • · MYTH #3 - You can have a "lifestyle" without having the money to support it: The misconception that you don't actually have to have money in order to have a brand new car, the latest cell phone or shiny new furniture supports the fictional credit idea that it's OK to have it now and pay it later. This trend, according to Gutiérrez, continues to sink Hispanics into a financial hole.

What to do?

The financial expert suggests you first stop and think, educate yourself, and make a plan you can stick to.

- Having a plan that establishes your monetary priorities allows you to see where your money goes, and makes you accountable for your financial decisions.


-Take a close look at all the money you have made and how it was spent

-Get mad at yourself; you have to feel sick and tired of your current financial situation. You have to get to the point where you are telling yourself, "I've had it, and I want something else!"


-Research the best plan for achieving financial stability

-Having a plan that establishes your monetary priorities allows you to see where your money goes, and makes you accountable for your financial decisions.

See one of Andrés Gutiérrez's financial classes (en español)

CREATE A BUDGET: the rich person's secret weapon

- Most people in financial trouble have never had a budget; rich people ALWAYS have a budget.
- A budget is the way you make your money behave and work for you.

The Budget: Your Financial Plan

To get you started, Gutiérrez suggests using this basic budget planner:

Categories and Percentages

Your Allocations

Housing: 25-35%

Saving: 5-10%

Charitable Gifts: 10-15%

Utilities: 5-10%

Transportation: 10-15%

Clothing: 2-7%

Medical/Health: 5-10%

Personal: 5-10%

Recreation: 5-10%

Debt: 5-10%

Financial expert Andrés Gutiérrez is the host of "The Andrés Gutiérrez Show" and creator of Paz Financiera. A successful entrepreneur and small-business owner, Andrés Gutiérrez knows what it's like to start with nothing and build lasting wealth. After hosting a San Antonio financial radio program and appearing frequently as a financial expert on the Telemundo television network, Andres joined Dave Ramsey's team in 2009 to bring the message of Financial Peace to the Spanish-speaking community.

Follow Andrés:

Twitter: @elshowdeandres


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