@lukenz?ÿ
Savers.
Spenders.
We lean more toward being Spenders.
We (me and my wife) need some psychology to help lean more toward being Savers.
I always found that if I worried about my clients' schedules I never had to worry about my cashflow.?ÿ They can be very demanding.
Licensed Land Surveyor
Finger Lakes Region, Upstate New York
Borrow yourself rich.?ÿ I have found it much easier to pay a debt than to save up to avoid a debt.?ÿ Seriously.?ÿ When you know you must have $xxxx.xx by the 20th to make a payment, you will make sure you have it.?ÿ But, saying to yourself that you should set aside the same $xxxx.xx each month so that someday you can purchase a specific thing is much harder to do.?ÿ There are too many opportunities to spend some or all of that money on something else.?ÿ The other half of that trick is to use the collateral that will get you the best interest rate.?ÿ Borrow against your home at 3.5 percent instead of paying a much higher true rate of interest by using something as collateral for which?ÿ the lender will insist on charging a higher rate.
I have gained survey clients by providing such simple advice.?ÿ Many times certain fees are eliminated by taking the best action.?ÿ For example, say you want to buy a tract of land that is mainly in the flood plain and your goal is to erect a structure on it.?ÿ Many lenders will not want to loan on such a tract with such a plan in mind.?ÿ Plus they will insist on flood insurance coverage for whatever the structure is worth.?ÿ Use space from an existing loan to borrow the money you need.?ÿ Say you have paid down $50,000 from the amount of your original loan on a different piece of real estate.?ÿ Have the lender bump your indebtedness back up to the original amount, which they will be more than happy to do.?ÿ Then take the $50,000 and buy your tract, build your structure and move on.?ÿ No appraisal fee, no new title insurance fee (unless you want to do so), no big loan origination fees, no flood insurance policy (unless you want to do so) and the approval on the loan may happen far faster.
This practice is also a great way to help your children.?ÿ Young people are lumped into a bad risk category simply because of their age.?ÿ You can lend them money at your better rate of interest.?ÿ Say they can get a decent used car for $15,000 but a lender wants 8% interest.?ÿ You can lend them the money at 4% using the method from above.
Years ago I had visited with a neighbor about buying a 40-acre tract when he was ready to sell it for a specific price.?ÿ Months later, on a Monday morning,?ÿ he saw me and said he was ready.?ÿ We closed the transaction on Wednesday.?ÿ A year later I used the collateral value of that apparently free and clear property to make a standard purchase of a different 40-acre tract.
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I have found it much easier to pay a debt than to save up to avoid a debt.?ÿ Seriously.?ÿ When you know you must have $xxxx.xx by the 20th to make a payment, you will make sure you have it.?ÿ But, saying to yourself that you should set aside the same $xxx]x.xx each month so that someday you can purchase a specific thing is much harder to do.
That can lead to a lot more stress, though, when it comes to finding a way to meet that deadline.
@bill93?ÿ
That's why it works.?ÿ You WILL find that money every month.?ÿ Sometimes we have to MAKE ourselves do things.
That's why it works.?ÿ You WILL find that money every month.?ÿ Sometimes we have to MAKE ourselves do things.
Yes. ?ÿThis key fits my (our) ??savings? personality.