Let’s start with week with a question asked at Afford Anything, Is Six Figures Still a Lot of Money? With half of the families in the US making less than $46K each year, $100K may seem a huge income. Yet, about 20% of families make more, pushing prices up for the rest of us. Which prompts the question – is $250K the new “six figures”?
Len Penzo discussed 15 vs 30 Yr. Loans: The Added Cost to Retire a 30-Year Loan in 15. Len offers a great analysis taking into account the lower rate a 15 year offers. With rates so low, the decision isn’t so simple, it often comes down to emotion, not finance. As I often say, one can’t put a price on a good night’s sleep. Lower payment and better cash flow, or a mortgage retired in a shorter time, whatever let’s you sleep better.
On the same subject, The Financial Buff does a bit of math in Borrow 30-Year and Invest The Difference, an interesting bit of math that shows the breakeven if you go 30 year and try to invest what you save. We may have to put him in a ring with Len and let them fight it out.
It’s been awhile since I was Thinking about Dave Ramsey, and my remarks about the mathematical failure of his debt snowball. This week I read a new variation on the snow theme, Silicon Valley Blogger suggests you Wipe Away Debt Problems With Debt Snowflakes. There some good details about what this means, but the bottom line is that you’ll send small payments many times over the course of the month. In the end, I won’t argue with success. If you are in debt, do what’s right for you.
At Moment on Money, Variable Annuity Prospectus: Clarity or Confusion? Art writes how few people actually read through the Prospectus when buying a variable annuity. Little surprise. I’ve said it before, VAs are sold, not bought. They are sold because the salesmen have kids to put through college. I have yet to find a VA with terms that looked appealing. Truth is, it’s not easy to get a prospectus as these are not financial products, but insurance, which means they are sold by people licensed in your state and unlike stock reports, are not usually available to be downloaded. What are they hiding?
At Mighty Bargain Hunter, Hey, that’s funny! Here’s some free stuff. I don’t get much free stuff, maybe I need to work on my material.
And that’s a wrap. Happy July!