MCM (modern coin mart) daily deals has usually been the best deal for me. Right now they have a lot of 10 one ounce bars for 189.30, current spot is 17.90. That's a bit high of a spread... you can often find it 50 to 75 cents over spot with free shipping. Of course, you will never sell for spot either, but that's the price of owning bullion... high spreads.
Commodities like gold and silver have their place as a small % in some investment portfolios to reduce risk. Gold/Silver as a large % is a boom or bust gamble.
Double down on your mortgage. Stop paying other people to use their money. Get familiar with an Amortization Calculator, and see how an annual (extra) payment (against the principal) will change the length of the loan. One extra payment a year will significantly (>25%) reduce the life of the loan. Two extra payments will change your life. The depression caused many investors to lose it all, but the farmers (who did not owe) just became self sufficient. YMMV
There's tons of articles out there on why it's not financially advantageous to pay off your mortgage. It comes down to a few things: 1. Liquidity. If you're paying extra on your house, thats money you're not able to use for other things. And when will you get it back? In 5-7 years or more when you sell? 2. Loss of tax advantage. For most of us, the interest deduction is the largest tax write off. 3. Opportunity cost. If I can use that money to generate interest income some other way, why dump it into a single large asset, where I can take money back out easily without incurring further expense?
If you're in a house you plan on staying in then the piece of mind of having it paid off early can trump what you listed. Logically speaking you do have a point though and if someone is in a house they don't plan on keeping it makes a lot of sense.
You can only deduct the interest on your residence, right? You can't deduct interest on investment property (rentals)?
At 3.75%, a $300,000.00 note has a REAL COST of $500,000.00 over the life of a 360 month loan. By adding one extra payment per year (towards principal) reduces the term by 48 months. Your investment (the 'extra' $ you spend is 26 x $1390) = $36,140.00 You will save ~$29,000 in interest, AND 48 monthly principal payments (at 'average' those payments equal~ $35,280.00) $35,280.00 plus $29,000.00 = $64,280.00 of real savings based on your $36,140.00 investment. (1.77:1) If you save those 48 payments, you arrive at the 30 year mark, with a free and clear home, and ~$95,000 towards a modest retirement Condo. This makes the rent from your former primary residence available for spending on trips to see the grand kids, and (maybe) do an occasional track day. YMMV http://mortgage-x.com/calculators/extra_payments.asp
I don't know squat about all this , but does the tax write off from the interest ever save you more than you're paying in interest ?
Tax deduction status depends on how it is financed. Some folks have gotten very creative. It can bite you when the laws change, as the governement hunts for revenue.
I don't think that's possible. It's a deduction, not a credit, so you only get a percentage back. I could be completely wrong here, but this is how I think a simplified version of the math would go: Say you pay $10,000 in mortgage interest while making $120k in gross income. The deduction of $10k reduces your taxable income from 120k to 110k. For simplicity's sake, we'll figure the whole amount at the 28% tax bracket. At $120k/yr you're paying $33,600 in taxes. At $110k/yr you're paying $30,800. Your net credit on all that interest paid is $2800 in tax savings. You could get really involved with this by building an amortization table and comparing interest saved vs tax saved year to year but I don't have time to work all of that out.
Brilliant... you get to NOT PAY the government 2000 bucks because you gave a bank 6000 bucks. Great investment strategy. </sarcasm>
