Think outside the box
Over the last five years more and more people are stepping outside of the box and recapturing huge amounts of wealth that would have been lost to costly conventional banking and finance methods. Methods that is costly and inefficient to families and businesses. New ideas are starting to catch on and a transformation of how we think and use our money is building momentum. By changing our thinking about how we use our money, you can change the course of your financial future. Optimizing your cash flow will empower you to accelerate to your goals and recapture wealth that can be redirected to your family and community where it belongs.
Every dollar we make is a valuable resource. It is has to be put to work somewhere by someone. That can be you or someone else like the bank. How do we know where to put it that will give us the maximum result? First we have to identify what kind of vehicles are out there.
Consider this, where you put your money each time you get paid will determine how fast you pay off your debt and create wealth. Every dollar you earn could be used to limit interest accrual or earn a return. If you take home $5,000 a month and spend $3,500 a month in expenses you have a $1,500 surplus. Where do you get the most benefit from that surplus? If you let it sit in a checking account you are just loaning it back to the bank. You could put it in a savings account at 1% and earn $1. Even if savings rates went up to 7% you would earn just $8 a month.
What about sending your surplus to your mortgage company? It is unreasonable to think that every month you could send all $1,500 to your principal. Even if you took $700 of it each month it would take you 171 months to pay off a 30 year mortgage of $250,000 costing you $101,000 in interest. The opportunity cost of that $700 a month could be even more. Every time you make an extra principal payment that money is trapped at the bank and comes off the back end of your mortgage.
Checking accounts, savings accounts and conventional mortgage liquidity traps all work in favor of the banks. The more of your money they can get from you without having to give you anything in return the bigger and bigger they get.
We believe the most effective vehicle to optimize your cash flow is in an all in one account. These accounts are excellent alternatives to conventional financing, checking and low interest savings accounts, because of the way interest and principal is impacted each time cash flow goes through the account. Your monthly income goes to work for you immediately saving you more in interest than what your saving account would pay in returns. Thus enabling you to harnesses the power of your monthly cash flow to rapidlyreduce what you owe, paying off your mortgage in 5-7 years, reducing interest accrual by up to 80% of what you would pay conventionally. These vehicles are designed like a credit line, secured or unsecured, that monthly cash flow can be directed into without losing liquidity and allowing you to access your funds at any time over a 5 to 10 year period without limitation. You can eliminate having to ever borrow from anyone but yourself again and puts a powerful wealth building tool at your fingertips. Unfortunately this strategy is not main-stream so it requires some thinking out of the box and some help from a financial strategist with experience in unconventional financing vehicles and cash flow management, see what the risks below are.
What is even more amazing about this cash flow optimization strategy is how effective it is for homes that are underwater in value. You do not need home equity or a refinance for this to work. Millions of families lose their homes each year unnecessarily to poor advice and lack of knowledge. Families or businesses with a positive cash flow could apply the same cash flow strategy inside an unsecured all in one account to accelerate mortgage principal. If your home is worth $100,000 but you owe $200,000 chances are the only solutions you have been getting until now are; sell your home, walk away from it, file bankruptcy or rent a room. Easy to say when it is not your home. All it takes is some innovation and using what you earn more effectively and you could soon be out from under your homes negative equity. This strategy will not help everyone unfortunately but it will help many families in this crisis save your home.
WHAT ARE THE RISKS?
Risk 1- Lack of discipline. Commit to practicing better habits and changing the way you think about your money. You will be paying off debt much quicker but you have to put forth the effort spend wisely so you don’t go back into debt.
Risk 2- No budget. If you don’t control where your money is being allocated each month chances are your money is not going to be used as efficiently as possible, and until you are out of debt that should be a priority. Get a budget in place and use innovative strategies like the Credit Card Strategy to stick to it.
Risk 3- Interest Rates/Inflation. Structured properly interest rates are a non factor. The size of the loan and rate caps help to mitigate risks. Seek professional help before attempting to find financing, not from bankers or brokers but from an independent financial strategist, Kingdom Financial Strategists www.mykfs.org, who specializes in cash flow optimization strategies.
Risk 4- The financing. For this strategy to work you will need an open ended secured or unsecured financing vehicle that allows for rate protection, cash flow optimization and easy access to your cash. There are only a few banks across the country that offers these vehicles. If you do not have prior experience in alternative financing then you should seek expert advice. Bankers and brokers will not be able to give you the advice you need because they are taught to sell you on rate and payment and they get paid more for selling fee based loans with high interest payouts.
Consider some alternative methods of using every dollar you make before continuing down the same path you have been traveling. You just might find some simple adjustments to the tires will give you the edge you have been looking for to accelerate to your goals.
Your first step is; get qualified help before you make any changes. You shouldn’t have to take unnecessary risks with your finances. Find an independent financial strategist that works for you exclusively (not for bank or lender) and let them help you navigate through every step of the process.
For advice and a free cash flow analysis contact Stephen Vincelli with Kingdom Financial Strategists, 727-502-7157, visit www.mykfs.org. Stephen is a financial strategist with over 10 years in the financial services industry.