Learn 4 Key Principles to Quickly Pay Off Property Free & Clear
Just as the big banks, here are four key principle strategies you must take into consideration when managing your real estate cash flow.
1. Interest Accumulation
Most folks believe that they can only earn interest on money they have set aside for the future; set aside for savings, nest egg, retirement, a rainy day, emergency fund etc. but the reality is, you are able to actually have every buck you earn either save you interest charges or earn you interest dollars.
Every dollar bill you earn could be working for you every single second of the hour if you understood the time value of interest accumulation and if you manage your cash flow more efficiently than you are now.
2. Interest Cancellation
If you could walk into your bank and give them $5 and in return they would hand you $23 from the cashier drawer, how many times a year would you want to do that?
This is not possible, for certain, you ask?
Yes it is.
How is this possible?
This happens when you cancel interest charges by using strategic payoff on amortized loans, rather it be mortgages, car loans, student loans, medical bills, boat loans, airplane loans – any loan that charges you interest.
3. Interest Float
If you purchase things utilizing a credit card to pay for them and you pay off the full balance of that credit card not when the bill arrive but on the due date, normally 30 days afterward, you are charged NO interest. This is called Interest Float. You just used Mr. Credit’s money for 30 days for free.
4. Strategic Payoff
This is the bank strategy that considers every aspect of each individual debt, along with incorporating a debtors income and monthly expenses to determine the fastest way, mathematically, to pay off their financial responsibilities.
Perhaps the #1 strategy banks use to build wealth is borrowing cheap money to pay off more expensive money. Yes, they even borrow your money as it sits dormant in your checking and savings account.
Banks have always used consumer ignorance of how the system works. Now it is time for you to get smart and start managing your cash flow to bank like the bank and not like a consumer.
Tags: Real-Estate