Creating and maintaining wealth is a very difficult task. Ask any millionaire!!! The delicate balance of living a dream lifestyle and holding expenses tight creates this difficulty. As a financial advisor, I have assisted people accumulate monies to live their dream life while discovering ways to reduce their necessary expenses.
Everyone would agree mortgages are necessary expenses. Probably the biggest expense most of us have. Mortgages present the opportunity to secure income tax deductions while utilizing the house to live.
What if you could reduce your mortgage interest rate to 3% and be required to pay interest only for 5 years? Would you refinance your current house? Purchase another?
While refinancing a client’s mortgage, I discovered such a mortgage. The client will save lots of money the next few years. Here is his scenario:
Client #1$500,000 Loan Amount
Past30 Year Fixed @6.00%=P&I$2,997.75/ month
5th year loan balance$ 456,989.77
Equity (assuming no appreciation)$ 43,010.23
Current
LIBOR ARM@3.00%=Interest only$1,250.00/ month
Applied additional $1747.75 / month to principal for 5 years
5th year loan balance$ 362,370.82
Equity (assuming no appreciation)$ 137,629.18
I proposed this loan program to Client #2.
Client #2$1.2 Million Loan Amount
Current
5/25 ARM@4.25%=P&I$5,903.28/ month
5th year loan balance$1,064,681.48
Equity (assuming no appreciation)$ 135,318.35
Proposed
LIBOR ARM@3.00%=Interest Only$3,000/ month
Applied additional $2903.20 / month to principal for 5 years
5th year loan balance$ 971,261.81
Equity (assuming no appreciation)$ 228,738.19
You can see from these scenarios this mortgage can be a great tool to reduce your monthly mortgage payment or to shave down the loan balance thereby increasing your equity.
This mortgage interest program is termed negative amortization. Rather than paying off the interest over the time period, you are paying of a small portion of the interest but not the required amount. Interest rates can go as low as 1.25%
If you want savings refinance your mortgage.
Avoid After Vacation Stress
Have you ever gone on a vacation and had a marvelous time only to feel stress later as you overspent????? Well, you are not alone. Many of us get so wrapped up in perfecting our tan or getting the rest we need that we do not even want to think about how much we will be spending. ”Very few people, no matter what their net worth and the level of their intelligence and financial savvy, do any kind of budgeting for trips,” said Gary Buffone, a psychologist and director of the Family Business Center, in Jacksonville, Fla. as quoted in an article on www.cbs.marketwatch.com It stands to reason you take a vacation to relieve stress. Why would any sane person ruin the euphoria of a vacation with the mundane task of budgeting?
Stop Planning for Future Retirement , Live Today in Style
For the past 85 years, the financial services industry – banks, financial planning, insurance and stock brokerages have experienced double digit growth by cajoling frightening individuals by the prospects of poverty and lack during retirement. Everything from radio, televisions commercials and print ads projected the bleak prospects for retirement if individuals did not save and invest. Individuals born between 1912 to 1945, currently ages 60 to 93, responded to this marketing strategy as they experienced the pain of the Great Depression.
Active Vacations: A Path to Health and Adventure
Active vacations offer a unique blend of excitement and fitness, providing a perfect solution for those looking to maintain their New Year's resolution of losing weight. Unlike traditional holidays, these trips incorporate physical activities like hiking, biking, and kayaking, making them an ideal way to jumpstart a healthier lifestyle. By integrating exercise into enjoyable travel experiences, active vacations can help establish lasting exercise habits, improve physical health, and enhance mental well-being.
