Comments on: The Total Money Makeover: Building Wealth http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/ Simple, applicable personal finance advice for the modern world Fri, 19 Mar 2010 21:24:47 -0700 http://wordpress.org/?v=2.8.4 hourly 1 By: Rocky Hinten http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/comment-page-1/#comment-3800 Rocky Hinten Tue, 23 Jan 2007 22:38:05 +0000 http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/#comment-3800 There is also more to it than just the numbers. (Not to mention that by the time you pay tax on the gain of that savings account, you're probably falling a little behind anyway.) There is an emotional side that really affects the situation. For example, when people call in to his talk radio show and are considering that type of situation, like investing more instead of paying off their house, here is how that exchange goes: Dave: "Let me ask you this, if you were sitting there with a completely paid for house that you owned outright, would you go borrow on it to invest in mutual funds?" Caller: "Well, no!" Dave: "That's exactly what you're doing. By me turning the question around, it gets your heart to consider the decision, and your heart is where you measure risk. That feeling of having a paid for house is something you do not want to give up if you have it. When you have a paid for house, you can take your shoes off and walk around barefoot in your back yard, and the grass feels different." There is also more to it than just the numbers. (Not to mention that by the time you pay tax on the gain of that savings account, you’re probably falling a little behind anyway.)

There is an emotional side that really affects the situation. For example, when people call in to his talk radio show and are considering that type of situation, like investing more instead of paying off their house, here is how that exchange goes:

Dave: “Let me ask you this, if you were sitting there with a completely paid for house that you owned outright, would you go borrow on it to invest in mutual funds?”

Caller: “Well, no!”

Dave: “That’s exactly what you’re doing. By me turning the question around, it gets your heart to consider the decision, and your heart is where you measure risk. That feeling of having a paid for house is something you do not want to give up if you have it. When you have a paid for house, you can take your shoes off and walk around barefoot in your back yard, and the grass feels different.”

]]> By: Amy http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/comment-page-1/#comment-773 Amy Fri, 08 Dec 2006 00:37:46 +0000 http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/#comment-773 Ah! Got it, thanks! Ah! Got it, thanks!

]]> By: Trent http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/comment-page-1/#comment-757 Trent Thu, 07 Dec 2006 17:19:44 +0000 http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/#comment-757 Dave is heavily into risk minimalization, and having any outstanding debt is a risk; that's why he encourages people to pay off their debts and never incur any again. Dave is heavily into risk minimalization, and having any outstanding debt is a risk; that’s why he encourages people to pay off their debts and never incur any again.

]]> By: Amy http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/comment-page-1/#comment-756 Amy Thu, 07 Dec 2006 16:42:24 +0000 http://www.thesimpledollar.com/2006/12/07/the-total-money-makeover-building-wealth/#comment-756 Could you explain why it's better to pay off your mortgage early? I'm debt adverse, so paying off the mortgage is my first instinct, but I also know my mortgage is only at 4.375% interest. I can beat that rate by putting my extra $$ into an ING savings account these days. Is it still better to pay extra on the principal of my mortgage? Could you explain why it’s better to pay off your mortgage early?

I’m debt adverse, so paying off the mortgage is my first instinct, but I also know my mortgage is only at 4.375% interest. I can beat that rate by putting my extra $$ into an ING savings account these days.

Is it still better to pay extra on the principal of my mortgage?

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