Hugh, The Maze MasterHugh's Reviews
Each week Hugh reviews something, anything really, that has provoked a thoughtful insight."Start Late, Finish Rich." - David Bach Another follow-up to my incremental change posts. David Bach is a financial guru who's been on Oprah, CNN, and more. He also wrote "The Automatic Millionaire".
In this book he talks frankly about the likelihood of most people not making it to retirement age with enough money and how very small changes in the present, stretched over time, can make huge changes in your financial future.
Got $243? You might be surprised to know that $243 dollars is actually worth nearly $80,000!
I got into checking out some of Mr. Bach's strategies for small changes that yield big returns and checked out refinancing my home mortgage.
9 years less. I found that I could take my remaining 24 years (out of 30 year mortgage), change the load to a 15 year mortgage subtracting 9 years of payments and saving almost $80,000 in interest! The cost? Just $243 more per month.
Start saving now. The other myth that I believed, and Mr. Bach TOTALLY BUSTED was the myth that you have to pay off all debt before you start saving.
As business owners, we can save in a number of ways before taxes. Including 401ks and IRAs that increase our rate of return by keeping money from the government. He advocates saving in this manner AND paying down debt as rapidly as possible.
Where do you get the money? Mr. Bach pioneered the "Latte Factor" - a classic example of brewing your own coffee instead of buying from Starbucks that can yield you over $300,000 in retirement money after 30 years!
Don't drink coffee? It just means you need to find your own "Latte Factor", mine - yes as many of you know I LOVE coffee, but I brew my own - was hardware stores, supplies, and especially tools. I found I would "buy a tool for the job" to make things easier, when I really just like having tools. Now, I only go to the store with specific lists of what we need for the projects that week.
What's your "Latte Factor"? Are you saving each month? Is your saving plan automatic (now our savings automatically withdraws each month)? Could a refi shorten the life of your mortgage?
It's the little things that count. All those little changes really add up!
Hugh
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