There are plenty of people who work hard and earn a decent wage, but many of these people do not know how to manage their money effectively. Due to the lack of knowledge, they make poor financial choices and have nothing to show for it. The goal of http://www.civilaccomplishment.com is to help give hard-working people a new perspective on how to manage their money. I want you to grow financially and achieve your goals. I am also learning new methods to work more effectively and produce results faster each day.
For the longest time, my wife and me shopped at our local Shop Rite. In high school, I used to work there stocking dairy products on the shelf. It makes it that much more enjoyable to know I do not need to work for $6/hr stocking shelves 39 hours a week. I was not allowed to work 40 hours a week because it would be considered full time and they would be required to pay me full time employee benefits. I digress…
There is a debate on whether you should use excess funds to pay off your mortgage or invest the money into something else. If your mortgage interest rate is less than 5%, the thought is you should utilize excess funds to invest because the average return-on-investment (ROI) is 7-10%. This number may vary depending on who you talk to. There is also the mortgage interest tax deduction aspect, which can be favorable. Most finance people will tell you the investment path is most favorable, but what happens if the ROI is less than 7-10%? What happens if your investment actually produces a negative ROI? At the end of the day, you may have nothing to show for your efforts and this is a risk I am not willing to live with. Again, most finance experts will not agree with me. BUT there are finance experts that do steer middle-class citizens in the wrong direction and might not even feel bad about it. There have been plenty of cases where good people have lost everything due to poor investments. Do you think those people thought the investments were bad ones?
It is difficult to track every penny in or out of our hands. From 2009 to 2011, I actually tried to track every transaction including cash, credit, debit, etc… I recorded over 1,000 transactions, which was very time consuming. There was some merit to this exercise, but I would not recommend for anyone to try this exercise unless you have a lot of time on your hands. The granular details do not always give you as much useful detail as the month to month data. How can this be and what do I mean by this?