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Do
You Make These Mistakes With Your Money?
By
James Hart
Do you carry a credit card balance? Is
most of your money at a bank? Are your taxes filed at the last
minute? Do you save and invest less than 30% of your income? Want
to know the biggest mistake you can make with money?
Let's assume your credit card debt
is $2,000 at 22% interest, and you routinely make additional
purchases of $20 each month thereafter. What are the odds of
paying-off your debt in
six-to-ten years? Absolutely zero! You will pay the credit card
company roughly $45 a
month, of which, an alarming $36.67 goes immediately to pay interest,
while only $8.33 is applied towards the principal.
What's more, any real reduction in
principal will be offset by your ongoing monthly purchases. Hence,
after forty years, you will have paid the bank $21,600
and still owe it $2,000.
Between credit card fees and interest, loan costs, ATM charges,
checking and saving fees, etc., all toll, the banks will roll
you for over $100,000.
Moreover, assume you were recently
approved for a $70,000 home loan at 11% interest over thirty
years. For this privilege, the bank will legally swindle you out
of $167,806 in interest payments alone; notwithstanding, tens of
thousands of dollars in closing costs, escrow fees, and points, et
cetera. Your true cost? Two hundred and fifty-thousand dollars
($250,000). And regarding that seductive Adjustable
Rate Mortgage (ARM) loan?
This banking scheme can dramatically increase your monthly
payment. In fact, on a $100,000 loan, an interest rate rise of
five-points can cost you an additional $134,074.
The
Mysterious10x10x10 Plan?
It was recently reported that
billionaire H. Ross Perot, paid a meager 8% on his taxable income
and thus kept ninety-two cents of every dollar he earned. Shrewd
tax planning? Indeed. Conversely, a lack of tax-planning results
in the following: a loss of thirty-three to fifty-cents on every
dollar we earn; you get a tax refund, (which is really an
interest-free loan to the government for devalued dollars) and
finally, you suffer another lost opportunity to seriously save and
invest your money. On average, the IRS (at the behest of predatory
politicians) fleece most people out of $300,000-to-$1,000,000
during their lifetime.
But imagine saving and investing 30% or
more of your income as did Gladys Holm. Although she never earned
more than $15,000 a year in her life--through the mysterious
10x10x10 plan, Gladys amassed an $18 million fortune. All of
which, was later donated to Children's Hospital. Can you figure out the "secret
ingredient" in this mysterious plan?...
Now
the Biggest Mistake You Can Make?
Super-rich banking legend Baron
Rothschild, called "it" the eight
wonder of the world. King
Solomon, said "it" was given
to all men.
Scientific genius, Albert Einstein, proclaimed "it"
to be the greatest invention he had ever seen.
Still, "it"--is working against most people.
Nevertheless, here is how the secret
of the ages can positively work for you, and change your life
forever.
Oseloa McCarty, was born an
African-American woman and raised in the South. Forced to quit
elementary school and care for her sick aunt, Oseloa faced extreme
prejudice throughout her life and opportunities were indeed, few.
In fact, as a domestic worker, she never made more than minimum
wage. Nevertheless, at
age eighty-seven, Oseloa
gave the University of Southern Mississippi a gift
of $150,000. And
still, there remained over $250,000 in her bank accounts.
How did she account for her wealth?
Listen carefully, she said: "The
secret to building a fortune is compounding interest. It's not the ones that make the big money, but the ones that know how to
save that get ahead." There you have it! Compound
interest is the Rosetta
Stone to great wealth.
Undoubtedly, a weak or non-existent
savings plan is an epic faux
pas, but failure to take full advantage of compound interest, is the biggest
money mistake you can make. Therefore, always, make compound
interest work, for you.
Let's
Put It All Together
Since only a hand full of Wall Street's
high-powered economic advisors and attorneys even understand what
you are about to discover, pay close attention. First,
aggressively establish a debt-to-income ratio of forty-nine
percent or lower. Second, roll the savings into your own
investment portfolio. Third, invest in a home with little or no
money down--pay it off in six-to-ten
years and bank $100,000 cash, automagically!
It's called the "Platinum Plan©."
(Excerpted from the best-selling new book entitled: Irresistible
Ways To Achieve Your Dreams.)
Copyright
© 2001,
www.efobi.com .
All Rights Reserved.
James
Hart, is chief economic counsel and investment strategist at
Credit Suisse Acceptance Trust. He is also an author, syndicated
columnist, and monetary scientist. Regarding questions, serious
financial matters, or general topics of concern, fire-off an
e-mail to: jhart@iopener.net
or
go to:
www.efobi.com |
Dallas, Texas
