Posts Tagged "financial situation"

Mentally Spending Your Next Raise Before You Actually Get It

Posted by Preet on Apr 4, 2010 | 2 comments

One thing I’ve noticed with some people is that they get progressively more stressed about money the older they are. That should come as no surprise. But it’s also no surprise that people tend to earn more and more money as they get older too. So shouldn’t things get less stressful? One (of the many reasons) for this phenomenon is the tendency for people to mentally spend future increases in income ahead of time, which is similar to how people will tend to spend exactly what they earn now (if not more). If you earn $50,000 (after tax) and you spend $50,000 after tax and you know that you are getting a $5,000 raise in the next three months how likely are...

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Refinancing your home Part 2: An Example

Posted by Preet on Jul 27, 2007 | 2 comments

Okay let’s show how an actual couple ended up freeing $915.80/month by refinancing their home. I’ve rounded the numbers, but they are from a real life scenario. We’ll begin with a snapshot of what their financial situation was BEFORE: Home Value: $250,000 Mortgage: $150,000 balance, 20 years left, 6% interest rate = $1,070 Monthly Payment Credit Card Debt: $10,000 balance, 18.8% interest rate = $500 Monthly Payment Vehicle Loan: $26,000 balance, 8% interest rate = $500 Monthly Payment Department Store Charge Cards: $5,000 balance, 28.8% interest rate = $250 Monthly Payment In this case, they have a total debt obligation of $191,000 and total...

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