2. January 2009 by admin.

HAPPY NEW YEAR!

We made it!

Step 7 from Dave Ramsey’s “Total Money Makeover”: Build wealth and give.

Get to the point where your money works harder than you do. Build wealth through mutual funds, real estate, a business, etc. financially ultra fit and 100% debt free. Pay off your mortgage early.

Now that you are completely debt free and your savings are filled to the brim, you are now at the mountain’s peak. This is where your money works harder than you. You are independently wealthy. You can clock out of that 9 to 5 job and never return again. Your savings and investments produce enough income for you.

So what do you do at this point? Invest wisely and give. Give of your time, talent, and energy to help others.

Personally, I believe the giving part should start at Step 1. We should set aside a tenth of our income and give it to the Lord even before we reach step 7. We should seek ways to help others grow even before we no longer have to report to a boss.

If you get to this step 7, you’ve perservered and for that, you should be proud. Many will fall out of the race. If you find yourself knocked out of the race, don’t just sit on the sidelines. Get up and keep running, even if you run alone.

You’ll get there.

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31. December 2008 by admin.

HAPPY NEW YEAR’S EVE!

Here’s Step 6 from Dave Ramsey’s The Total Money Makeover

Get financially ultra fit and 100% debt free. Pay off your mortgage early.

Imagine the day when you can say to yourself. You have no debt, nada, zip, zilch. Nothing. No credit cards, No student loans. No nothing.

What joy! It can happen. For many people, the mortgage is the single largest payment they will ever have. Imagine the feeling when you make that LAST MORTGAGE PAYMENT. To get to this point you will have to round up all your extra money: after saving 15% for retirement, after having three to six months expenses, and after stashing away college money for your children.

You can do it.

Yes you can.

Many scoff at this step by saying: “Why pay off your mortgage when you can have the benefits of deducting the mortgage interest on your taxes every year?”

Let’s reason together, shall we?

Why pay $5,000 in interest to a bank each year just so you won’t have to pay $1,500 in taxes to the government. Sit down and do the math with your own mortgage interest payments and tax savings. Does it make sense for you?

So start paying down that mortgage principal and before you know it. You’ll be coasting on to the final step to financial freedom.

Update: Don’t forget to sign up for my bi-monthly newsletter. You’ll get important updates and the chance to enter free contests designed exclusively for my newsletter subscribers. To sign up send an email to info@preslaysa.com and write “Newsletter Sign Up” in the subject line.

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29. December 2008 by admin.

Here we go again!

Check out Dave Ramsey’s book “The Total Money Makeover” for an in depth explanation of this and the other steps to financial freedom.

Step 5: Fully fund Education Savings Accounts and/or utilize 529 plans.

Definition of a 529 plan: an education savings plan operated by a state or educational institution designed to help families set aside funds for future college costs. It is named after Section 529 of the Internal Revenue Code which created these types of savings plans in 1998.

Definition of an Education Savings Account: a tax advantaged investment account designed to encourage savings to cover future education expenses. It is found at Section 530 of the Internal Revenue Code.

In other words, start stashing away money for your children’s college, even if they are infants. In fact, infanthood (Is that a word?) is the best time to start saving for your children’s education. The earlier you start the more attention you’ll be able to give to funding your children’s education. Using 529 plans or Education Savings Accounts will assist with this. These plans have certain income limits and/or fees so check the fine print before you sock your money into these types of accounts.

Visit http://www.irs.gov/ for the latest tax information regarding these types of accounts. And if you are worried about investing your children’s education money in stocks, I suggest putting them in safer, cash type investments while still using the 529 or Education Savings Account vehicle.

Update: Don’t forget to sign up for my bi-monthly newsletter. You’ll get important updates and the chance to enter free contests designed exclusively for my newsletter subscribers. To sign up send an email to info@preslaysa.com and write “Newsletter Sign Up” in the subject line.

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