Overcoming debt - Turning the Table on the Bank

By: Marv Eisen

A home is the greatest asset that most people own. Conventional mortgages are usually 30 years, with the homeowner making 360 equal regular monthly payments. In that time, which covers most of the homeowner's highest earning years, most pay is allocate toward paying down the mortgage. In addition, discretionary funds must be allocated toward future retirement.

There's difficulty with this, for the reason that most people don't have much extra income during the years the mortgage is being paid. As a result, savings are often woefully insufficient when the mortgage is fully paid off. It may be unfair to single out the mortgage as the reason for this, but without a doubt, the mortgage is the largest single payment most homeowners make each month.

Can debt be the reason for people being unable to save for future retirement? Perhaps. Debt has become an enormous industry for lenders, who have adopted insidious and abusive practices to keep people in debt and make it difficult for them to pay back their loans. Mortgages are the largest sources of debt, and so the largest problem for most people. That makes sense, because of the size of a mortgage loan. It represents not only the largest monthly payment, but that payment spans a 30 year period and the highest earning years for many people.

For people taking a long-term view of their finances, they know debt reduction is a key aspect of a secure financial future. Of course, because the mortgage is the largest debt, it will have the greatest impact on the family's finances. To do this, some people include additional funds with their monthly mortgage payment. A smart idea provided it's maintained. Nonetheless, people tend to not do it regularly so after a while, there's a tendency to stop doing so altogether. Most people find it is easier to follow a system, because using a system, the adherence to including the extra payment each month is more consistent. Furthermore, a system usually reports back showing the savings that are being generated. Lacking a structured method, people neglect to maintain the plan.

An ingenious method of mortgage reduction has been recognized as very effective in reducing debt. It is called the "Australian Mortgage Accelerator". Using this method, the mortgage is commonly reduced to about 10 years, saving hundreds of thousands of dollars and about 240 months of payments. For all its effectiveness, most people have never heard of it. The strength of this accelerator is due to the fact that it uses the homeowner's regular income to lower the loan balance. In effect, it combines the homeowner's mortgage and checking accounts. It also projects the homeowner's savings, which provides motivation. This motivates the homeowner to be consistent in following the plan to the completion.

It's challenging to explain how the accelerator works, but most important, it's simple to do. Find out more about the startlingly effective Australian Mortgage Accelerator. It should come as no surprise to discover that homeowners everywhere have used the Australian Mortgage Accelerator with great results.

It’s also not surprising that some people like to follow their own system, as in do-it-yourself. That’s fine for a small segment of the population, but unless you are really dedicated and self-motivated, it really helps to have a plan to follow on a regular basis. Then, there are those who are penny wise and pound foolish, as they insist that spending money on something they can do themselves is itself a waste. Some of these proponents of self-sufficiency go so far as to refer to anything that carries a price yet can be done without spending money as a scam. These people are truly poisonous, as they attempt to enforce their negative opinion on others. Nevertheless, most people need a plan to effect any real change in their lives; just having access to a spreadsheet program does not replace the motivation provided by a professionally designed system.

On a further note, there are debt-reduction methods call “debt roll down”. These methods are used to target credit card debt in a way that prioritizes accelerated payments to one credit card at a time, using the minimum monthly payment as a base, and then adding a monthly roll down amount. The process typically targets the card with the lowest balance. After the first card reaches a $0 balance, the payments roll down the card with the next highest balance, using the minimum plus the now-available funds that previously were paid to the first card. The good news is that mortgage acceleration programs incorporate roll-down methods in their structures, making them even more valuable. You owe it to yourself to find out more. If you’re in debt with no plan of getting out, click the link.

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Slash your debt using a mortgage accelerator

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