Before reading this post, you should turn your eyes a little bit further on the right and have your mouse pointer follow. Then, you will notice a big orange buttonâ€¦ CLICK ON IT! If my â€œpersuasion techniqueâ€ does not work on you, well please just sign up for this blog RSS Feed by clicking on that orange button;-) Then, youâ€™ll get my daily post in your email everyday!
I had the idea of this post after a comment left on my blog from financialjungle.com on the article about The Double Dip strategy ( I know I was supposed to post the Double Dip Part2 a week ago, but I had problem posting the calculation chart. I should do it shortly). As you probably noticed by now, I usually use 100K for my calculation on hypothetical investment loan when debating about leverage strategies. Financial Jungle was suggesting that 100K might be too much for leverage. My answer to this is; it depends (haha! Speaking of a typical banker’s answer!). Seriously, I think that the question about leveraging is not if you should do it or not but how much should you leverage?
As I was explaining in my answer to Financial Jungle, there are two major factors to be considered when you are talking about leverage loan. The first one is your available cash flow. Investment loans are a good tool to apply the â€œpay yourself firstâ€ strategy. As you are actually contracting a real loan, you have no other choice but to make the minimum requested payment at the end of each month. As leveraging strategies are built on a long term investment horizon, you must ensure that you will be able to cover the monthly payment. You have to take in consideration your actual budget plus the possibility of interest rate going up. Hopefully, interest rate will not climb to the Everest Mount soon, but might sit at 7-8% for a while. Prime rate in
|How I Suck at Not Paying Debts||Hitting 6 Figures Income at 28|
|How I Get a Huge Income Raise Each Year||Making $125K Online in 12 months|
|How I Buy Blogs||Most Debated Articles: The Primerica Saga|
|How I Have Survived My MBA||What is So Wrong With Making Money?|
|How I run multiples blogs and makes money without burning out|