September 14, 2014
The monthly payment mentality can devastate one’s financial life. What is it? How can you stop it?
The monthly payment mentality can devastate one’s financial life. What is it? How can you stop it?
Many people think of things on a monthly payment basis and do not think of the cost of the item as a whole, they think i can make a $400 a month payment but do not think that the thing they are buying may be $40,000. People need to look at the sticker price of the item and what it will really cost them in the end after interst and fees, the monthly payment is not a good thing to go off of for a price. For a car, see what it will cost you when you pay cash for it, like you should. Avoid making monthly payments and just pay for the whole of the item at once
Well said, Garrett. Let’s review.
When considering a purchase, focus on the full cost of the item (including the interest rate that goes with a loan), not the monthly payment. Then ask yourself, can I afford that.
Example: Do not ask yourself whether you can afford the $400 monthly payment. Ask yourself, can I afford that $40,000 thing with 4% tacked on going to the bank for the loan?
Change your mindset and you can change the way you deal with your money. Ultimately, you can change the course of your life. Awake to the possibilities!