Personal Finance Resources

The interest only mortgage is a relatively new term, and not many home buyers are aware of its existence. An interest only mortgage is the only type of mortgage loan that has regular monthly payments that are only applied towards interest on the loan, and not the principal for the first years of the term of the loan. The advantage of an interest only mortgage is that your monthly payments start out considerably smaller compared to a conventional mortgage during the interest only portion of the loan. If you are wondering if an interest only mortgage is right for you, then just keep reading.

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A Traditional IRA (Individual Retirement Arrangement) is one of the most popular methods Americans use to save for retirement since it is an extremely versatile and simple. A Traditional IRA is a personal savings plan that gives you tax advantages for setting aside money for retirement. Taxpayers want to invest in an IRA, but when it comes to understanding which one is best for them and why, they are unsure. The information provided below will help you decide if a traditional IRA is right for you.

Tax Benefits

In the Traditional IRA,  all investments grow tax-deferred until they are removed from your account, meaning you are able to invest more of your money over the life of the IRA since they are paid with before-tax dollars.  Tax deffered means that the earnings in your Traditional IRA are not taxed until funds are withdrawn from your account.  Any IRA 401(k) contributions you  make to a Traditional IRA are typically fully deductible, but at least partially deductible, depending on your situations.  Taxable distributions may be taken without penalty starting at age 59½ and must be started by April 1st once you have reached 70½. 

Contribution Amounts

In previous years, each participant under the age of 50 in a Traditional IRA had contribution limitations of $3,000, but that amount has been increasing over the past few years. This is to help aid participants in being able to invest enough money for retirement with ever increasing costs and inflation. All participants over the age of 50 have higher contribution limitations as a ”catch up” benefit. For more information on your contribution limitations, see the chart below.

The key benefit of a Traditional IRA is tax-deferred growth.  Money invested in a Traditional IRA is pre-tax money, and therefore allows you to invest more of your hard earned money to save for retirement. You will want to review your situations before deciding if a Traditional or a Roth IRA is right for you. To compare the benefits of each, see my post on the subject, Invest in a Traditional IRA or a Roth IRA?, or my post describing the Roth IRA called, What is a Roth IRA?

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Guaranteed car finance companies have helped thousands of customers who have different past credit problems to finance the purchase of a new or used car. Some people need guaranteed car finance simply because they have no credit history. So, thank goodness for guaranteed car finance arrangements whereby you can find a car you like and drive it out of the showroom within minutes, right? Maybe not. You might want to look a little closer before signing those papers…

Rates

As usual, the rate you are offered will depend upon your credit history. If your credit history is bleak at best, then you can bet your quote will include an interest rate that is sky high upon “approval”, and be careful with that as well, because the rate advertised is not always the rate you will get. I’ve heard of some guaranteed car finance companies coming back with an interest rate as high as 15% and higher! That’s like credit card interest on a larger principal amount. Car finance rates are determined by the percentage or cost added onto the loan by the lender and the dealers get paid a commission on higher purchase deals and will try to charge a rate that is more beneficial to them, and not you.

Payments

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Deciding whether to buy a new or a used car can be difficult. When considering your options, which of these three do you fall under:

1. I am looking for a particular car, and am not concerned with its depreciated value over time.
2. I am looking for a balance between investment value and features/preferences.
3. I am looking for a car that will retain the highest value possible over time.

There are distinct advantages and disadvantages no matter which way you choose to go. But let’s look at my recommendations based on the above categories. If you fall into Category 1, you should buy a new car, and drive it for years to come. The key thing here is, that you do not sell you car within the first two years, as new cars lose 60-70% of their value during this time. You should expect less maintenance costs with a new car, but I highly recommend obtaining a great warranty package as well to further reduce your maintenance costs, the point being that since you will be making a car payment, you want to have as few unforeseen costs as possible.

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In this post, I am going to show the exact steps I take to evaluate a potential real estate investment property. The focus will be on single family residences, but this method can be applied to other types of property. Also, I am going to include the actual spreadsheet I use to input the obtained values, and work the numbers. With the knowledge and tools that you will find here, you should be able to estimate your costs for a real estate property, and consequently, the profit you should expect to make from the deal. The only thing not included in this spreadsheet are any repair costs and holding costs associated with a potential real estate investment property, as this will be covered in a future post. Ok, let’s look at each of the steps carefully:

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The Roth IRA is relatively new to the investment world, having only been on option since January 1, 1998. It was created as a result to the Taxpayers Relief Act in 1997 to help Americans better save for their retirement. For some people (I generally think that in the long run, the Traditional IRA is the better bet for most people; see the Traditional IRA vs Roth IRA breakdown), the Roth IRA is a better choice for their investment needs than the older Traditional IRA for several reasons.

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Credit Repair is generally the process of bringing “back to life” your credit history and raising your credit score. Credit repair is the process of restoring your financial reputation. Credit repair is completely legal as long as you follow the rules and guidelines provided by The “Fair Credit Reporting Act”. The “legal” steps to credit repair include:

• Obtaining a copy of your credit report.
  You are entitled to a “free” copy of your credit report once a year from annualcreditreport.com, or you can buy a credit report from one of the three major reporting agencies - Equifax.com, TransUnion.com, or Experian.com.
• Review the list of negative entries.
  Be sure to carefully review the entries, and focus on the negative items that are of longer duration, e.g. 90 day items are more important than 30 day items.
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  Internal Tags: Credit Repair, credit restoration repair my credit

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Now don’t misunderstand me here. I am not trying to say that having a partner(s) is a bad thing when investing in real estate, in fact, many times it is a great thing. Partners help to limit the risk of a particular real estate deal, and can provide alternate opinions, and bring needed capital to the deal. In fact, I am still using a partner today, even though my first experience with a partner was a disaster. The pitfall occurs when you pick the wrong person to do your real estate deal with. Here are a few things to remember when it comes to choosing the right person to partner up with:

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It’s a known fact that shopping for car insurance is a pain in the rear.  It’s a state law, and you hate it, but you have to pay it.  Or maybe you want that big policy because you just bought a new car, and nothing would be worse than totalling the new car and not being able to replace it.  But before you pick up the telephone or go online to find car insurance quotes, be sure you know what you need.  Here is a quick list of things to think about before contacting a company about car insurance:

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Sound too good to be true? It isn’t it. The concept and recipe for success in real estate investing is very easy to understand, but very difficult to do. Forget everything you have heard from the “gurus”, and the promise of making sweet deal after deal with no money down that is going to pay you thousands and thousands of dollars. These late night infomercials are only after one thing - sell you their system. The one thing that you absolutely have to know and care in real estate investing is this:

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