Sweet and Sour Interest

Sweet and Sour Interest

   Payor:  “Good news:  interest rates are down.  I’ll refinance and borrow more.”

   Payee:  “Bad news:  interest rates are down.  Where can I get a better return and less risk?”

   “If I was offering an investment that you could put your money in and get an immediate 50% return, you’d beat my door down to buy it,” said the financial advisor.  “Look at your mortgage amortization and see how much you will save in interest expense if you just pay extra on your house payments.”

   No matter the market condition, it will always be a win/loose situation between borrowers and investors.  But this truth is always constant – if in debt, early repayment is always your best investment.

   No matter the investment risk, return on investment is always taxable.  Eliminating debt not only nets more in saved interest expense than most investment returns, but it is risk free and tax free.

   “Be not thou one of them that strike hands, or of them that are sureties for debts.  If thou hast nothing to pay [if you owe nothing], why should he take away thy bed from under thee?”  (Proverbs 22:26-27)

   For more information contact (your emergency preparedness specialist).


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