Debt Free: Pay Off All Of Your Debt, Including Your Mortgage, Fast
The single most important financial rule is the simple RULE OF 72. But, be sure it is working to your advantage and not compounding against your accounts.
Take the investment you are looking at and the RULE OF 72 will calculate the number of years it will take for your account value to double. It will tell you how long it will take for the money you owe to double, as well.
Here is how it works. Simply take the number 72 and divide it by the percentage rate you are either paying on your debt or earning on your investment. So, if you have a savings account with $10,000 in it and it earns 3% interest, your money will take 24 years to double to $20,000. (72/3=24).
Does this motivate you? It should, if you consider that 1 penny multiplied by 2 every single day for thirty days will become $10,737,417!
I love this quote from Baron de Rothschild, when asked if he could name the 7 wonders of the world: "I cannot, but I know that the eighth wonder of the world is compound interest."
It is so important to not only earn a higher percentage return on your investments, but to pay a lower percentage interest rate on your debts and eliminate as much debt as possible. We don't want to make the financial institutions rich. Let's keep as much as we can for ourselves and put our money in a position to take advantage of the RULE OF 72 instead of being a victim of it.
For most of us, our biggest loan is our mortgage. The banks are killing us by using the RULE OF 72 against us. Over the course of our loan, they will watch their accounts grow exponentially as we pay only a tiny amount against our principle with each monthly payment and a HUGE amount of interest to them.
Is there a way around this? Yes there is! Why not pay down that mortgage in half the time? There are simple ways to accomplish this:
One way is to send more principal with your payment each month, to be applied to your loan balance.
Another option is to use a bi-weekly payment plan. Most mortgages can be set up to utilize one of these. If your bank does not, do an internet search on: "bi-weekly mortgage plan."
There are also a few software programs that utilize a web based system to show mortgage payers how to better manage and pay down the mortgage and other debt more efficiently than they could do on their own.
I personally use one of these software programs and have shared it with my readers. It allows me to cancel out interest on my mortgage loan, using money that I would usually deposit into my checking or savings. It also uses an ADVANCED LINE OF CREDIT, which is open-ended and calculated not on the MONTH-END BALANCE, but instead on a DAILY PERIODIC INTEREST RATE. This is different than mortgages use. It puts the power into the homeowners hand by allowing them to use all of their cash and income throughout the month, in their favor, before it is needed to pay their monthly bills. This takes away the banks power to make money on the homeowner's money each month, as it sits there waiting to pay the bills.
My book: "3 SECRETS OF MILLIONAIRES", has a full chapter on this awesome concept. Search Google to find it or just go to the PayOffYourMortgageInHalfTheTime web site, for a free print out. It will explain how many thousands of dollars in interest you will save and your exact mortgage payoff date. Check this out for yourself! Setting up a mortgage elimination plan can save you tons of money you would normally just give to your bank or mortgage company.
There is also a video on that web site, with an overview of this unique tool to pay off your mortgage faster.
Get the RULE OF 72 working for you, to create your fortune, instead of having it work against you to make the banks rich.
Article Source: FxTradingStock.com
About the Author
Learn more about how to eliminate your mortgage. Stop by Mike Koller's site where you can find out all about Secrets Of Millionaires and what it can do for you.
by: Mike Koller
Total views: 39
Word Count: 699
Date: Tue, 27 Jul 2010
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