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It's only 5% on amazon purchases. And only if you're a Prime member. There is no other 5% category. With the one I linked to, you choose two categories for 5% and one of them can be Amazon if you want (under bookstores). Then you choose one 2% category. You can change them every three months.
Location: Chapel Hill, NC, formerly NoVA and Phila
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I don't have a problem with Dave Ramsey telling his audience that credit cards are evil and they shouldn't use them. I do have a problem with Dave Ramsey's audience then telling those of us who are financially capable that credit cards are evil and we shouldn't use them. Hogwash! I can handle credit cards just fine, thank you very much.
It doesn't change the percentage of profit the bank makes but it will reduce the length of time they will make that percentage of profit. They just loan the extra money back out again and collect the fees for originating the new loan so their profit may actually go up.
Yes you're right but I can't change that so it makes no difference to me. However what I can change (like you said) is the amount of time the bank makes interest off me. They have their projected outlook on the loan at 30 years. So to them they are looking at me making payments for 30 years thus making x amount off that borrowed money. I'm borrowing x and paying it back as fast as I can. Meanwhile rates are going up and prices are going higher.
I'm basically borrowing at about 2.3% interest when it's all said and done and my target is to pay off the 30 year loan in 10 years. Because that's when I plan on retiring. If I get this job from this company that wants me to run their new branch I'm basically going to make 40% more income. I'll accelerate the f out of this mortgage.
For me to use DR advice and go cash out a bunch of things to pay cash for a house is asinine. There is no reason for me to do such thing. I have plenty of additional income that more than pays the mortgage even if I wasn't working. But then I'm not DR target audience.
There is nothing wrong with taking a mortgage. What's wrong is people start seeing the house as a piggy bank
I don't think he's wrong about the mortgage part. At least, I always think, people would do better to at least get a starter home or a condo instead of plunging into dream home with high payments. Get an asset under you first.
I heard him explain it once. Basically handing over cash is more painful than putting it on a credit card so you tend to spend less using cash. There is reason in that argument. Though I am not about to walk around with checks and a money belt. I use my card for transactions and pay it off every month.
I make a lot of my purchases online because I chose not to support the corrupt farce that is govt here in Illinois with my sales tax dollars if I can avoid it and it is more convenient. It is easy to find what I need online vs running around to stores.
I usually smdh to most hardcore Dave Ramsey audience. Seriously his advice is something you tell a 10-18 yr old about money while raising them as a child. Its pretty basic stuff (Extremely basic). I also can't stand his thoughts on government assistance yes people abuse it and yes its has help people rise to the challenge of getting off it (but his audience think they are all crackheads and meth heads). Most people don't go any further than saving and getting out of debt because his methods programs people into Cheapskate hobbits that are scared to invest most breakdown.
I'm basically borrowing at about 2.3% interest when it's all said and done and my target is to pay off the 30 year loan in 10 years. Because that's when I plan on retiring.
I think I understand where you are going in that you would rather pay $50k total dollars toward interest if you make extra payments to have it paid off in 10 years rather than say $180k in total dollars towards interest if you make minimum payments for 30 years. The total amount paid towards interest is important to you and I get that.
However, I just want to make sure you, and others, realize no matter how much extra you pay the interest rate is not changed. There is no changing a 3.6% rate to 2.3% by making extra payments. No matter how much or little you send in for extra payments the calculation remains the same. Your interest rate divided by 12 months times the amount you still owe. Again the only thing changing is the amount of time you are paying that interest rate.
Quote:
Originally Posted by Electrician4you
For me to use DR advice and go cash out a bunch of things to pay cash for a house is asinine. There is no reason for me to do such thing. I have plenty of additional income that more than pays the mortgage even if I wasn't working. But then I'm not DR target audience.
There is nothing wrong with taking a mortgage. What's wrong is people start seeing the house as a piggy bank
Absolutely agree. I could have paid full cash for my home but that would have been a very bad decision. I put enough down to avoid PMI and invested the remaining money (after closing costs). Those investments have paid off at a much larger return (interest rate and dollar amount AFTER TAXES) than I would have saved if I had purchased my home for cash. The lenders money was cheaper to use than mine.
I think I understand where you are going in that you would rather pay $50k total dollars toward interest if you make extra payments to have it paid off in 10 years rather than say $180k in total dollars towards interest if you make minimum payments for 30 years. The total amount paid towards interest is important to you and I get that.
However, I just want to make sure you, and others, realize no matter how much extra you pay the interest rate is not changed. There is no changing a 3.6% rate to 2.3% by making extra payments. No matter how much or little you send in for extra payments the calculation remains the same. Your interest rate divided by 12 months times the amount you still owe. Again the only thing changing is the amount of time you are paying that interest rate.
Yeah sorry I didn't mean to make it sound like my rate changed. I'm talking overall after interest deduction on taxes my rate is effectively "less". Not that the rate is a huge tax write off but any little bit helps. Regardless the deduction I would still buy a house. But yes my rate doesnt change. I apologize if it reads that way. It wasn't meant to.
Yes I'm paying some interest no doubt. I completely understand that. I am after all borrowing money from a lender and they have a right to make money on their investment. I'm just not paying as much as I would if I took the loan all the way through the 30 years at the minimum payment.
Absolutely agree. I could have paid full cash for my home but that would have been a very bad decision. I put enough down to avoid PMI and invested the remaining money (after closing costs). Those investments have paid off at a much larger return (interest rate and dollar amount AFTER TAXES) than I would have saved if I had purchased my home for cash. The lenders money was cheaper to use than mine
Exactly. There is no advantage to me to pay cash. I did the same thing, I put a bit over 20% because it changed the loan from a jumbo and the rate was lower if I put a extra 3k down. Also the PMI was absurd. I just round up the monthly so it adds up to a mi the payment over a year time and additionally make a extra payment a year.
The inky reason I did a 30 year was if I ever decide to stop making the extra payment the normal payment is well within my comfortable range. I'm still going to pay it off early.
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