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Tips That Make You Feel Like a Genius
Secretly, I feel like a genius when I discover a secondary use for this or that — in case I run out of this, but have plenty of that! Like using a paper coffee filter to wash a glass top or mirror when I'm in a pinch for paper towels. Or using …Read more.
Supermarket Tricks That Makes Us Spend More
I've always thought of myself as pretty sharp when it comes to spotting supermarket trickery. I'm not even fazed by an end-cap display announcing, "Special." I know their ways. They hope we'll just assume that "special" means …Read more.
The Struggle to Actually Use up Gift Cards
My love-hate relationship with gift cards has intensified. What a pain, really. I'm one who just forgets to use them, and when I remember, I try to figure out how to use each one to the last cent. I was reminded of my situation recently when I …Read more.
Commingle Personal and Business Finances? Never!
Dear Mary: I am reading your book, "Debt-Proof Living," and have begun tracking my expenses. I have a home-based business. Should I include business expenses or just personal expenses in the tracking? — Lucy, Vermont
Dear Lucy: You …Read more.
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New Mortgage Repayment Method a Risky BusinessDear Mary: I recently took a Web seminar on Money Merge Accounts in which they talked about the idea of paying down a home mortgage using a home equity line of credit. They told us to use the home equity line of credit as a personal checkbook to pay all our expenses. But how would using a home equity line of credit that has a higher rate of interest be to someone's benefit? -- Mike, e-mail
Dear Mike: Money Merge Account is a trade name for a somewhat complicated mortgage repayment technique. Generally, the technique requires you to have a home mortgage, impeccable credit, a lot of equity and a big low-interest home equity line of credit. At the beginning of every month, you determine your total take-home pay for the coming month. Then you transfer (borrow) this amount from your line of credit at the beginning of the month -- before you actually receive the income you have projected -- and send that to your mortgage holder as an extra principal payment. Next, you arrange to have all of your paychecks deposited directly into the line of credit. You write checks against the line of credit using it as your household checking account. Simply put, you never allow yourself to have money sitting in a bank account. You pay everything with debt. Every dollar you earn immediately goes to cover some debt.
A company, United First Financial, has taken this general theory and named its home equity line of credit the Money Merge Account. If I understand their program correctly, for a fee of $3,500 -- and if you can qualify -- you get their equity line of credit and software for your computer that supposedly lets you track, project and manage this tricky repayment technique. United First Financial peddles the MMA and software in free, high-energy seminars. There's some logic to the theory, but in reality, I find this terribly risky, if not dangerous. The adjustable interest on the underlying line of credit could turn this thing upside down in a hurry, should interest rates rise. I wouldn't touch this mortgage repayment method with a 10-foot pole. But don't take my word for it. I challenge you to run this by a licensed CPA to see whether he would buy this deal -- or even take it for free. If you have $3,500 to spare, I recommend you use it to pay down your mortgage principal. You'll whack years from the payback period and a load of interest, too -- on your own. No juggling and no software required. Do you have a question for Mary? E-mail her at mary@everydaycheapskate.com or write to Everyday Cheapskate, P.O. Box 2135, Paramount, CA 90723. Mary Hunt is the founder of www.DebtProofLiving.com and author of 17 books, including "Debt-Proof Living." To find out more about Mary and read her past columns, please visit the Creators Syndicate Web page at www.creators.com.
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