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Old 05-28-2019, 05:40 PM
 
Location: Western MA
1,594 posts, read 1,039,894 times
Reputation: 4116

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Quote:
Originally Posted by JonathanLB View Post
The funniest part is when they give you 0% interest. I was very confused by that with my engagement ring, I bought it last summer, I was expecting to have to pay upfront and whatnot, then the guy tells me they have 0% interest for 18 months. I said oh umm ok, well if I choose to pay all at once, do I get some sort of discount? You know, like 3% off if I pay in full in cash right now? Nope, nothing. Not a single dollar discount. So I couldn't figure out any logical reason why I'd pay that much money all at once if they're going to give me free financing. I put it on autopay so zero potential for late fees or anything like that, and it has just chugged along for 10 months now paying down the total.

I'm a little bit OCD about that kind of thing, though, I've never actually liked that. I'm frankly weird with financial things like that, even when it makes no sense to be like that. I like having an extremely low monthly overhead, so I've bought houses free and clear before even with low interest rates, just because I like to see the monthly bills be low. It doesn't make good financial sense whatsoever, but it's somehow peace of mind, I guess. So I'm a bit annoyed that my monthly bills are now higher because of something I bought 10 months ago, even though I fully realize it was a good decision and the only logical option. I'd be lying if I said I'm not looking forward to that charge going away in 8 months, though.
They make a lot of money, statistically, on the people who do not have it paid off in the 18 months. There is usually some clause that allows them to charge interest retroactively to the start of the loan. The more people they get to sign up for the 0% hook, the more people they will end up getting that hefty interest from. Sure, there will be a few who have it all paid off in time, but the ones who don't make up for that and then some.
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Old 05-30-2019, 01:58 PM
 
1,186 posts, read 1,143,219 times
Reputation: 996
Quote:
Originally Posted by LizfromtheBronx View Post
In 2019, I have set goals of:

- close on home purchase (this was supposed to be happening this month but the deal fell through at the last minute so I have to start over ugh)
- pay off small amount of remaining credit card debt (have the funds to pay it off now but hoarding cash before new home)
- increase 401k contributions to 10%
- once CC debt is gone, start aggressively paying off remaining student loan debt - <$5k at this point with an interest rate better than my car or likely mortgage but just want it gone)

Sub goals:
- any purchases for new home either made in cash or if financed, paid off by end of year
- bump emergency fund up to a level appropriate for updated expenses

That sets me up to start saving for a kitchen and bath reno (estimating $25-30k), as well as some elective surgery (~$40k), which I'm hoping to be able to do in 3-5 years.

No other large purchases on the horizon - car is in great shape and doesn't need replacement in the next 5 years. Barring any unforeseen life changes (ha!!!!!), I should be good.
Updates - still haven't closed on a home, but decided to change locations. This plan allows me to pay about $100k less for a home, which saves a good deal more of my nest egg, and I'll likely not have to do kitchen/bath reno, or put much money into new home. Not only are the new contenders far cheaper but you get a lot more for your money. Depending on final purchase price, I will likely be able to pay mortgage off in 15 years (although I will still get a 30 just for flexibility).

I got a yearly merit increase two months ago, and upped my 401k contribution to 9%. Hoping for a promotion with a bigger increase later this year and will further up to 12-13%. I'd also like to open an IRA, but have to dig further into which one is appropriate for me.

If the new location plan works out, and I pay what I am now projecting for a home, I will have at least half of my surgery costs funded. I will also pay off any revolving debt in a lump sum and possibly throw some money at the car loan, and look to refinance that to a lower rate.

I no longer want to prioritize student loan debt, it's now below $4k and I just don't care anymore lol. It's on autopay and I just don't need to make it a thing.
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Old 05-30-2019, 02:34 PM
 
Location: On the road
5,942 posts, read 2,893,129 times
Reputation: 11381
Liz you sound like you've got a good head on your shoulders.
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Old 05-30-2019, 03:14 PM
 
1,186 posts, read 1,143,219 times
Reputation: 996
Quote:
Originally Posted by lieqiang View Post
Liz you sound like you've got a good head on your shoulders.
Thanks! Took a while to get here, but glad I finally made my way lol.

I'm now having fun in my budget spreadsheet projecting out what everything would look like with all of these plans implemented. I should be able to start saving A LOT more for retirement. I'm so so so behind, and need to get aggressive, especially now that I'm 40.
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Old 05-31-2019, 04:00 PM
 
Location: Beaverton, OR
5,562 posts, read 5,913,054 times
Reputation: 6356
Quote:
Originally Posted by bizcuit View Post
They make a lot of money, statistically, on the people who do not have it paid off in the 18 months. There is usually some clause that allows them to charge interest retroactively to the start of the loan. The more people they get to sign up for the 0% hook, the more people they will end up getting that hefty interest from. Sure, there will be a few who have it all paid off in time, but the ones who don't make up for that and then some.
Wooow thatís pretty bad, so they just hope someone canít even make that no interest payment one month and then has to start paying interest fees or something? Thatís unreal.

Iím annoyed by the monthly bill at this point because I just forget it even exists and while itís not causing any hardship, Iím looking forward to it being gone. I was making a budget for the new city when we move and I didnít include it, but had to note it still will be around through 2019.
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Old 06-01-2019, 10:01 AM
 
Location: Western MA
1,594 posts, read 1,039,894 times
Reputation: 4116
Quote:
Originally Posted by JonathanLB View Post
Wooow thatís pretty bad, so they just hope someone canít even make that no interest payment one month and then has to start paying interest fees or something? Thatís unreal.

Iím annoyed by the monthly bill at this point because I just forget it even exists and while itís not causing any hardship, Iím looking forward to it being gone. I was making a budget for the new city when we move and I didnít include it, but had to note it still will be around through 2019.
Why not just set up an automatic online payment through your bank? That way you don't have to deal with the bill.
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Old 06-01-2019, 03:14 PM
 
Location: Beaverton, OR
5,562 posts, read 5,913,054 times
Reputation: 6356
Quote:
Originally Posted by bizcuit View Post
Why not just set up an automatic online payment through your bank? That way you don't have to deal with the bill.
It is automatic thankfully. They still insist on sending me paper invoices but itís all paid through autopay. I set it up before we even got the first invoice haha I knew otherwise it would just be a hassle. I forget it exists though so I have to remind myself sometimes, oh ok itís not that Iím spending more money than usual lately, itís just that $335/month or whatever goes to that payment and artificially boosts my spending per month in what I thought would be a one time expense.
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