Wealth Building – How to Transform Your Debt Into Wealth
Many families are feeling the crunch of unemployment and the economic downfall. Here are ways that you can improve your checking account this Christmas while still being able to do your Christmas shopping. These are all ways that families can save.
Transforming your debt into wealth involves linear math and a critical path system, not a magic wand. Despite the obvious benefits of paying off your mortgage sooner, many homeowners still ask, "Why should I pay off my seven or eight percent mortgage when I can get a better return by investing in the stock market? I can probably get ten to fifteen percent or better there." This is one example of the conventional financial wisdom that so-called experts have taught us, and it's complete rubbish!
Here are 3 Reasons Why the "Better Return in the Stock Market" Idea is a Myth:
Reason #1: Comparing mortgage interest rates to stock market investments is an apple to bananas comparison.
Another thing is to keep your gift cards. We are all given gift cards when Christmas rolls around. Why not take the ones you might or might not use and regift them. If they are empty, rather than buying a new card, just give it to someone else.
So, the question is, "What interest rates are homeowners actually paying those first five to ten years of their mortgage?" I did the math and discovered that a homeowner paying month to month on a 0,000 mortgage with a 7% fixed interest rate will still owe 94% of that mortgage at the end of five years. After ten years, that homeowner will still owe 86%!
The next question is, "Okay, so what happens when you move into a new home?" You guessed it: you start over with a brand new mortgage and paying an interest rate of 85-95%!
How can your 10-15% return in the stock market make up for the money you lose to your "great" mortgage rate? Add to this the reality that people are constantly refinancing to get a better interest rate or getting home equity loans to consolidate debt, and it comes as no surprise that only 2% of Americans truly own their homes. 98% own mortgages.
Television and film extras can be paid around £200 a day, which is a nice additional income if you are fitting it in around your regular job. The main downside to this 'easy money' is that it entails a lot of waiting around, early starts and long hours. If you are interested, look in the Yellow Pages for your nearest casting agency
Resource Author Francisco Rodriguez Higueras
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