Financial Dinosaurs: Five Pieces of Advice That Belong in a Museum

In a world where financial landscapes and personal lifestyles are rapidly evolving, traditional financial advice often doesn’t keep pace. Here, we dissect some commonly held financial maxims that have lost their relevance in 2024 and explore smarter, more practical approaches for today’s economy.

1. Working Through College is Enough to Graduate Debt-Free

Historically, students were often advised to work part-time to avoid student loans. In 2024, however, the skyrocketing costs of tuition far outpace what can be reasonably earned from part-time jobs.

Modern Advice: Explore scholarships, grants, and work-study programs that offer substantial financial help without the overwhelming workload. It’s also wise to consider community college or online courses for general education requirements at a fraction of the cost.

2. Always Buy a Home—It’s a Great Investment

The dream of homeownership as the ultimate financial achievement is fading. In many urban areas, the real estate market has priced out average buyers, making this goal unattainable or financially imprudent for many.

Modern Advice: Renting isn’t throwing money away—it’s paying for a place to live without the commitment of a mortgage and maintenance costs. Weigh the benefits of mobility and lower upfront costs against the long-term investment potential of buying a home.

3. Buy Savings Bonds

Once a staple of a conservative investment portfolio, savings bonds today offer minimal returns compared to other vehicles.

Modern Advice: Look into high-yield savings accounts, mutual funds, or ETFs for better growth potential. Diversifying your investments can also reduce risk while increasing potential returns.

4. Buying Is Always Better Than Renting

This age-old piece of advice doesn’t hold up under scrutiny in today’s rental market. The decision to buy or rent should be based on personal circumstances including financial stability, career goals, and lifestyle needs.

Modern Advice: Consider the flexibility that renting offers, particularly if you’re young, mobile, or in a volatile job market. Buying should be a decision made when you’re ready to settle down and financially prepared for the long-term commitment.

5. Your Home Is an Investment

Thinking of your home as a primary financial investment might lead to disappointment. The costs associated with homeownership can often negate the potential gains in home equity.

Modern Advice: Treat homeownership as a lifestyle choice rather than an investment strategy. Ensure any home purchase fits within your broader financial plan, including retirement savings and other investments.