Wednesday, April 29

FINANCIAL PLANNING Part IV

Ideas to Save Money...

When buying a newer car:

  • Don't buy a brand new one
  • Look for a year old car (can save $10-$15,000)
    • a leased vehicle
    • leased by a company not an individual
    • low mileage
  • Once this car is pay off, save the payment money
  • Use saved payment money to buy new leased vehicle




Upgrade your present home every 3-5 years:

  • Purchase a $50,000 home (2020 - age 25)
    • Only renovate bathroom/kitchen
    • Sell for $75,000 (2025 - age 30)
    • Shelter capital gains money from taxes
  • Buy 2nd home for $100,000 
    • Only renovate bathroom/kitchen
    • Sell for $150,000 (2030 - age 35)
    • Shelter capital gains money from taxes
  • Buy 3rd home for $200,000
    • Only renovate bathroom/kitchen
    • Sell for $250,000 (2035 - age 40)
    • Shelter capital gains money from taxes
  • Buy 4th home for $300,000
    • Only renovate bathroom/kitchen
    • Sell for $350,000 (2040 - age 45)
    • Shelter capital gains money from taxes
  • Buy 5th home for $400,000
    • Only renovate bathroom/kitchen
    • Sell for $450,000 (2045 - age 50)
    • Shelter capital gains money from taxes
  • Buy 6th home for $500,000
    • Only renovate bathroom/kitchen
    • Sell for $550,000 (2050 - age 55)
    • Shelter capital gains money from taxes
  • Buy 7th home for $600,000
    • Only renovate bathroom/kitchen
    • Sell for $650,000 (2055 - age 60)
    • Shelter capital gains money from taxes
  • Buy 8th home for $700,000
    • Only renovate bathroom/kitchen
    • Sell for $750,000 (2060 - age 65)
    • Shelter capital gains money from taxes
  • Buy 9th home for $800,000
    • Only renovate bathroom/kitchen
    • Sell for $850,000 (2065 - age 70)
    • Claim ONE TIME exemption from IRS on Capital Gains and purchase a less expensive home
    • Pay off mortgage debt
    • Save about $250,000 to $500,000
NOTES:
  1. This concept assumes that the economy is continuing to grow
  2. This concept assumes that each year you will receive wage increases
  3. This concept assumes that you purchase a house that is in good physical condition
  4. This concept assumes that you use common sense when renovating
  5. This concept assumes that you take good care of your home
  6. This concept assumes that you don't mind moving every 5 years
  7. This concept assumes that you select homes in viable communities


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