If You're Thinking "This Doesn't Make Sense" then You're Right
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- Опубліковано 6 вер 2024
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This is exactly what I did with a Home Equity line of credit. Oh I paid off my credit cards alright. So now 15 years later I still have that line of credit that climbed from 5.2% interest to 10.2 % interest in 2022. Payments= $140 to interest and $38.00 to principal. Following the baby steps, I will be rid of this monster at the end of the year. Long slow road. 😢
Will be well worth it when you come out the otherside!
What would the interest be on the credit cards?
@@bogella2225 the credit card interest was 23.99%
Line of credit interest is always/ almost always accrued by daily average balance. So if the LoC interest rate was 10.2%, in order to have $140 in interest, you would be owing ~17,000 on it. That is crazy low.
Velocity banking works as long as you bring in more money than you spend.
All the loan officers were telling me to get a HELOC, and I refused, and got a normal equity loan. Guess which one the interest rate never changes on? Yup. I made the right choice there! Built out 2 short term rentals with it and will have it paid off in just a few years with additional cash flow remaining after it's paid off.
Mathematically it usually does but most people can’t handle money well enough to pull it off.
Thanks for the advice! I'm new to financial planning and wasn't sure where to start. Any tips on finding a reliable financial adviser or resource to guide beginners?
As a beginner, it's essential for you to have a mentor that is verified by finra and SEC to keep you accountable. I'm guided by a widely known financial consultant Stacey Macken
Truly, investing has changed my perspective on how one can succeed in life; working multiple jobs isn't the optimal way to attain financial freedom and unfortunately, we discover this later in life. Currently earn as much as 12 grand weekly and this has improved my financial life
YES! that's exactly her name (Stacey Macken) I watched her interview on CNN News and so many people recommended her trading skills, she's an expert and I'm just starting with her....From Brisbane Australia
This Woman has really change the life of many people from different countries and am a testimony of her trading platform .
Retirement took a toll on my finances, but with my involvement in the digital market, 27thousand weekly returns has been life changing.
We consolidated into a zero interest card. Diligent payments saved us tons of interest- so it thankfully worked for us. But by the skin of our wallets.
... unless the new line of credit has a lower interest rate. In that case, you save money, aka that makes sense!
The risk is not worth the reward. Series of smart decisions will make you rich. Series of bad decisions will keep you poor.
So you pay off lots of different debts faster, but end up with one bigger debt that still has to be paid off. Saving you no time.
That is part of the precise Point I've been trying to make some of these numbskulls in this comments section. And they keep forgetting about the fact that using a credit card to get these three and five percent Cash Back Rewards is asinine when you can get those same rewards and control the amount you contribute AKA spend if you want to look at it as far as giving money away for any form of cos, without being a debt and without being penalized interests against you let alone a late fee if you don't contribute a certain amount each month
Velocity Banking sounds like something marketed by sales reps who speak too fast to be understood 😂
If the line of credit is lower interest than the debt you put on it then the math is sound as long as you don't rack up the old debt again
But that goes against the Church of Debt Bad that Ramsey preaches at the pulpit of...
@@NotKimiRaikkonen well I'm a bit of a rebel. I also love my credit card cash back to pay for my Christmas present.
@@laundrygoddess4 I am too. Haven't paid for a flight in over a decade.
Not really. Even if you get a lower interest rate, they will still charge you fees. It really doesn't work. I don't agree with Ramsey on a lot of his ideas but this isn't one of them.
@@jackolini I have a math degree and I've gone through this several times with friends. It has never worked out to be worse math wise by taking a loc out at less than half the interest. Never.
Or a concept know as the US government
Credit Card surfing
Isn’t velocity what the US government does?
Yes and notice something even if we didn't have a bunch of people and user consumers defaulting on credit cards and other forms of debt, the government of the United States of America has been jacking up our debt as a result of that and other methods that devalue our dollar. So don't do what the United States government does especially when it's hurting us as a nation as far as our value because eventually other nations that we have that have bought our debts they're going to come after us one day and I pray it's not during my lifetime
Ponzi scheme... US gov't... same thing.
lol. George! Why are you such a smart butt? 🤣🤣🤣
Uhhh so like... PONZI SCHEME?!?!
No. That's social security.
This is a lie. Velocity banking makes a ton of sense. Currently doing it right now and paid off a ton of debt way faster than the snow ball method.
No it doesn't. Because a high yield savings account destroys that argument alone let alone proper investing in a Roth IRA
Facts don't care about your feelings.
When you owe...it isn't your money in the end...
When you save ane invest...it IS...your money at the beginning , middle, and end.
*drops the mic laughing as he walks away*
@motoryzen do you feel smart repeating lines word for word that Dave says? Birds can do the same thing.
If you use it to get a lower interest rate while still applying the snowball, it actually makes a whole lot of sense and lets you get to debt free faster
@austinlutz4016 do you feel stupid yet that you refuse to learn from the mistakes of past men have made? Kid it's not rocket science it doesn't make a crap if I'm repeating Dave Ramsey's words or the words of someone older than him from a previous generation. At some point you the individual have to learn critical thinking skills take the information you're giving them from someone questioning it, practice it and see if it actually works. This is called growing up and being an adult and learning to gain the room to talk through experience. It's not rocket science and facts do not care about your feelings
I'm not your mirror nor therapist. Move on
It absolutely works. It is an amazing concept. Clearly some people do not know how to use it.
The thing is Velocity banking is not a product, but a concept. You don't need a line of credit of any sort to do this. You can do this with a simple savings account.