Reverse Mortgages

[bettingpython]

Personally, we don't use the credit cards because we wouldn't use them enough to make it worthwhile. And the whole let the plastic in my wallet lead me not into temptation thing...

But along the same lines, that's kind of what we do with our PayPal cards. Our checking account earns interest as long as we use the bank's debit cards 12 times in a month. That's easy to do: a coke here, can of Altoids there, etc. PayPal gives 1.5% cash back, and it draws from your bank account if you don't maintain a balance. We put everything we can on the PayPal card and usually get more than a tank of gas for the Mini in the cash-back amount. We've filled up the truck when the big annual stuff like taxes were due.

We use amex as our cash replacement, you have no choice your bill is due in full at the end of the month so we literally monitor it's balance and our bank account just as if it were a debit card. When we go to Germany in a few years one of our tickets should be paid for by point's balance and the other one should be signifigantly discounted.

In the few instances Amex is not accepted we use the discover card. Put he taxes on it this year.

 

[Werewolf]

I only use credit to magnify the power of my dollar. My cash goes in interest bearing accounts with no monthly fees. Further, my credit card company gives rewards points. I haven't paid for an airline flight in years. That's more free money.

Paying the monthly balance down to ZERO is smart and absolutely the way to go.

The note is for 1.9% interest. My money can make more money than the financial company is charging me on the loan. That's more free money for me.

Please share with us what kind of and where you place cash that currently earns you more than 1.9% APR.

Money market accounts are paying below 1% even with balances over $50K and even long term CD's barely break 1.5% these days. I won't even mention savings account interest rates as they're close enough to 0 to be 0.

So share, won't you, where you're putting your cash.

 

[striker754]

Paying the monthly balance down to ZERO is smart and absolutely the way to go.



Please share with us what kind of and where you place cash that currently earns you more than 1.9% APR.

Money market accounts are paying below 1% even with balances over $50K and even long term CD's barely break 1.5% these days. I won't even mention savings account interest rates as they're close enough to 0 to be 0.

So share, won't you, where you're putting your cash.

Not sure where you are looking but you can get a 3 year CD for 2% or a 7 year CD for 3.49% at penfed

 

[Shootin 4 Fun]

That's complete and utter ********.

Look dude, the fees associated with an RM are a scam. The RM company is placing a lien on a home and loaning part value knowing full well that the heirs are not going to hassle with financing a house just so they can turn around and sell it for very little equity because the RM company has compounded the interest to eat up the equity that wasn't loaned.

AND your target audience is financially uninformed elderly people. Now that's what we call ******** where I come from.

 

[poopgiggle]

Do the smart thing. Sell everything, cash out and go down in a week long whirlwind of Viagra, cocaine and hookers, rather than donate thousands of dollars to a bank.

INTELLIGENT POST DETECTED

 

[dennishoddy]

GC says if we play our cards right we will spend our very last dime exactly one minute before we take our last breath ...

(And knowing the two of us it will be on ammo ... lol)

Amen sister!

 

[Werewolf]

Not sure where you are looking but you can get a 3 year CD for 2% or a 7 year CD for 3.49% at penfed

GTG indicated/strongly implied he puts his cash in liquid accounts and none of those to my knowledge pay anywhere near 1.9% interest which is why I asked where he was stashing his cash.

3 year and 7 year CD's are hardly liquid and depending on the lending institution may have substantial penalties if cashed in early. Unless one believes interest rates are going to stay flat or go down locking in 2% for 3 years or 3.49% for 7 - except under special circumstances - isn't really all that good of a deal.

CD's with face values over $100K can in fact be traded like bonds and their market values change in the same direction as bonds. So they are essentially a liquid instrument and can almost be considered the same as cash. They trade at current T-Bill and Note rates which are considerably higher than a non-negotiable standard bank CD and are a really good deal currently - assuming one has $100K to buy one.

I don't know a lot of folks that can drop cash into and out of $100K bank CD's and even if they could it isn't really likely they'd use them as short term cash instruments.

So I am still wondering where GTG stashes his cash as I'm pretty sick of earning .8% or so on a money market account with a $50K+ balance.

 

[Glocktogo]

Paying the monthly balance down to ZERO is smart and absolutely the way to go.



Please share with us what kind of and where you place cash that currently earns you more than 1.9% APR.

Money market accounts are paying below 1% even with balances over $50K and even long term CD's barely break 1.5% these days. I won't even mention savings account interest rates as they're close enough to 0 to be 0.

So share, won't you, where you're putting your cash.

The liquid cash is rotated on a monthly basis and is held in a money market account at 0.9% APY. The car note is for 5 years. Rather than pay off the note or buy the car for cash, we put the money in a 48 month Share Certificate at a current rate of 2.5% APY. These rates can be found on the Tulsa Teachers Credit Union. The APY for a money market account with $50K+ at TTCU is 1.2% BTW.

Sure the car money's tied up somewhat, but it's still better than paying the car off up front. Our financials are diversified between available cash (the money market and share certificates), traditional and Roth IRA's, 401K's, some individually held stocks, guns and a small amount of gold & silver. Also available are several lines of credit should it ever come to that.

In today's economy, too many people rely on credit. That doesn't mean having credit is a bad thing. When you have a credit score over 800 you can take advantage of opportunities that do not exist for people with poor credit. I didn't make the rules, but I'll sure take advantage of them when I can.

As I said before, this country actively discourages saving. When your yield on a savings account doesn't equal the rate of inflation, it means they want you to either gamble you money away or spend it outright. You'd still be a fool to not save for a rainy day though. As someone feeling like a chump because you have over $50K parked in a 0.8% APY account, you're still miles ahead of everyone who said screw it and indebted themselves into poverty or gambled away their earnings in a volatile market.

 

[finnimus]

There's a difference between debt and credit.

Agree. Credit is monies that are available. Debt is what you go into when you use those funds (regardless of the period of time they are used). So using someone else's money for any period of time is technically debt.

I think more people going cash only would be good. Too many people don't recognize how to live within their means due to abuse of credit (debt). Credit was never meant to be used that way, but the lenders figured out they could make more profit off our misery if they kept us shackled in debt. Same for retail business. To say otherwise would defy logic.

Agree that misuse of credit is the issue, not credit itself. Revolving credit can serve a very good role in unplanned situations. As you stated, it should never be used for sustaining day to day life.


I'm still not sure I understand what you mean by "I've yet to see a good use for debt that actually outweighed the liabilities of cash liquidity"

What are the liabilities of cash liquidity?

 

[inactive]

The liquid cash is rotated on a monthly basis and is held in a money market account at 0.9% APY. The car note is for 5 years. Rather than pay off the note or buy the car for cash, we put the money in a 48 month Share Certificate at a current rate of 2.5% APY. These rates can be found on the Tulsa Teachers Credit Union. The APY for a money market account with $50K+ at TTCU is 1.2% BTW.

I guessed it was a CD as they are the only thing around that rate right now. If one looks, they could find a high yield MMA for around 1.35%


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