Month: November 2020

Cut out expensive habits.

Do you like to drink, smoke, or gamble? Cool, me too. We should hang out sometime. Actually, we shouldn’t. We should both try to quit those expensive habits. Sure it’s fun to have vices, but vices can be expensive. Why not pick up some new, less expensive habits? For example, I cut out the drinking, smoking, and gambling. My only current vices are playing too much Scrabble and using historical quotes way too often in casual conversation. You can bet Churchill wasn’t talking about me when he said, “He has all the virtues I dislike and none of the vices I admire.”

Sell some stuff.

Just about everybody has some things of value lying around the house collecting dust. Why not sell these things (dust them off first) and make a little money. Your best bet would either be to put them up for auction on ebay or to have a garage sale. Both methods of selling items have their pros and cons, but I personally prefer ebay. With ebay, you can just lie about the condition of an item, or even the item itself and the buyer will have no idea. I once sold a man a sheet of paper with a stick figure on it for $10,000. I listed the item as a “rare Picasso sketch.” And that is why I now have a negative 753 ebay rating.

Stop driving so much.

We all know that cars are expensive to drive, so why not drive them less? Carpool as much as possible, use public transportation, or even walk places if it’s a viable option. Just stop using your car so much. (Note: this tip does not apply to NASCAR drivers, truck drivers, the guy who drives the Oscar Meyer Weinermobile, or anyone else who has a profession that is dependent on driving cars.)

Stop using your credit cards.

If you stop using your credit card, there’s no way that you can possibly spend money that you don’t have. If you have funds set aside for emergency purposes, you won’t have any use for a credit card. Hmm, I guess you could use them as coasters for really small drinks, but that’s about it. Try payday loans & personal loans in California.

Stay at home more often.

I’m not suggesting you become a recluse, but if you stay at home instead of going out all the time you’ll save a ton of money. You might think you need to go out to the bar or to a nice restaurant with your friends in order to enjoy a Saturday night. Wrong. I can’t tell you how many times I’ve enjoyed a perfectly lovely Saturday night alone by the fire, reading a novel by one of the Brontë sisters. Of course, when I’m finished I usually cry myself to sleep, but everything up to that point was enjoyable.…

I know that there are a million different mortgage variations. The most popular is definitely the fixed mortgage.

The ultimate question is: Should I get a shorter term mortgage or a longer term? Here are some basic pros and cons with a shorter length mortgage (15 years) vs. a longer length mortgage (30 years).

Pros of a 30 year mortgage:

• You have “up to” 30 years to pay off the mortgage. If you have the extra cash, you have the option to throw more money at it.
• You have smaller monthly payments. You can use the extra money to feed your kids.

Cons of a 30 year mortgage:

• You pay nearly twice as much interest compared to a 15 year mortgage.
• It takes longer to pay off the mortgage.
• It takes longer to build equity.

Pros of a 15 year mortgage:

• You pay less interest over the life of the mortgage.
• The mortgage ends quicker.
• You build equity much faster.

Cons of a 15 year mortgage:

• Your monthly payments are larger.
• You have less time to pay off the mortgage.

…

A few weeks ago, I did a post that covered some home equity loan basics. In that post, I listed one of the advantages of a home equity loan as “Payments are often tax-deductible.” That’s some really insightful information, huh?

How about some more detailed information, courtesy of Bankrate.com. Basically, interest paid on a home equity loan or home equity line of credit of up to $100,000 is tax-deductible. There are a couple exceptions, however.

So this stipulation only affects you if you have a loan-to-value (LTV) ratio of over 100%. For example, if your home is worth $100,000, you still owe $80,000 on your mortgage, and you have a home equity loan of $30,000, your LTV ratio will be 110% – ($80,000+$30,000)/$100,000. In that case, only interest paid on the first $20,000 of your home equity loan is tax deductible, since the other $10,000 is the portion of your loans that exceeds your home’s value.

One more exception – if you use your home equity loan for home improvements, you can deduct interest on up to $1 million in mortgage debt. In this case, it’s especially important to keep track of receipts so you can prove that your loan really was used to finance home improvements, and not just used to buy that diamond-encrusted cell phone you’ve always wanted.…