97

This is an interesting question. Many people would tell you to pay the highest interest rate loan first. There are many others who would tell you to pay off the smallest balance loan first. In your hypothetical situation, both groups of people would tell you to pay on Loan #2 first. But you are proposing to pay off Loan #1 first, which is the loan that ...


68

Here's some tenets I follow when helping others: Don't support bad habits Don't give money to someone to pay gambling debts, or to pay rent because they've spent all of their money on less important things (drugs, alcohol, electronics, etc.) Give them what they need, not what they ask for I do this a lot with "panhandlers" that solicit me in a ...


55

It doesn't literally involve astrology or tea leaf reading... While some people swear by it, technical analysis is often derided as pseudoscience, similar to astrology or tea leaf reading. As it's relatively common, knowing the basic concepts gives you an idea what other market participants might be thinking, especially with regard to support/resistance ...


51

It is not your job to assist others financially, in a way that rewards good habits. It is not your job to train them in good financial habits. And even if you did try, more than likely, you're not going to change any bad habits that they have picked up over a lifetime. With that said, for 12+ years I have been contributing to the support of a cousin whose ...


50

The total balance is irrelevant. Try thinking about the interest in terms of each dollar borrowed. Just using simple interest, each dollar borrowed at 1.69% costs you $0.0169 for the year. Each dollar you borrow at 3.6% costs you $0.036 for the year. The difference between those (0.036 - 0.0169 = 0.0191) is how much you'd save in a year for each dollar of ...


37

The first question to ask yourself is do you even need life insurance? The benefit amount, 500K is fairly large, but it can also be too small for your needs. Do you have people that are dependent upon your income? Do you have a wife or children? If you don't, then you don't need life insurance. As a single person with no children life insurance is ...


28

Lets make the numbers a bit easier. Suppose the situation is as follows. Loan 1: $150.000 at an interest rate of 2% per year Loan 2: $50.000 at an interest rate of 4% per year This situation is equivalent with the following setup, where we split the first loan into three loans. Loan 1: $50.000 at an interest rate of 2% per year Loan 2: $50.000 at an interest ...


25

Pete has a good answer already, but I will add 2 separate thoughts for you to consider: First, go ahead and google "World Financial Group". Google will autocomplete this to "- scam?" This is the first step in determining legitimacy of the company. Note that it is a multi-level-marketing company, which is a happier term for a pyramid scheme. The problem is ...


25

Because what if nobody wants to buy at that price any more? When the buy price and the sale price meet, a transaction happens, and those prices are removed from the market. That means there's always a gap between the highest buy price and the lowest sell price. No more trading happens until someone decides to increase the buy price or decrease the sell price....


23

I just want to start by saying I absolutely love this question! Note that you did not specify a monetary range, so I have provided suggestions that span the gamut. Investing Are you talking about adults only, or including children in your target help group? For minors, setting up a UTMA/UGMA and buying them an investment can work, provided you're willing to ...


18

Here is a simulation using a simple program loop. It determines which loan has the largest monthly interest (i1 or i2) and allocates the repayment (d1 or d2) to that loan. A more refined version could look a month ahead (each loop) to find the optimum monthly repayments for each loan. I don't have time to add that at this time. r1 = 1.69/100/12 r2 = 3.6/...


17

It's an analogy. In general, many hold the belief that the typical traders (read: not Warren Buffett levels of money where the simple act of trading can change the market) cannot beat the market in the long run. "Wisdom of the crowd" and all that — everyone has already made their best guess what the price should be and the average of those guesses ...


16

Can one just forcefully acquire a company that is stock market listed? No - all they can do is buy up all of the shares that are put up for sale. And that public buying would put significant upward pressure on the stock price, causing it to rise as shares were bought. That said, they could buy up enough to get a majority voting share and basically run the ...


15

Just write a check There's pretty good research that points to just giving money as an effect way to lift people out of poverty. Bonus - you aren't going to harm your relationship with anyone by trying to manage their life. "Invest" your time Think of this as leading by example. If you spend quality time with people, you will rub off on them. They'...


14

Just because one buyer was willing to pay $X doesn't necessarily mean other buyers will as well. Maybe that first buyer isn't interested in buying any more since he already has what he wants. If you don't mind waiting, potentially quite a long time, then you can feel free to leave your selling price at $X, or even increase it. But if you need the product ...


12

Geez. Everybody wants to give you a fish. I’d like to teach you to fish. What if? In the 70s, a program called Visicalc put PCs on every manager’s desk because it let you “play” with numbers. Change a number and see what happens. Today, you use Microsoft Excel for that same thing, though Apple Numbers or Google Sheets will do the same thing. Excel etc. ...


12

Kudos to you to wanting to make the world a better place! Maybe ask yourself, what is the best use of the extra money that you don't need? $100 that you don't need could provide enormous benefits to people in poor countries (or very poor people in your own country) but only modest benefit to your friends and family who are presumably doing ok. Consider ...


12

The way I would model for budgeting it is that the employer has loaned you $100 and will pay part of that to you each year until there is no balance left. So for now you have an Account Payable of $100, and each year you have an Income of $20 that reduces that payable. For tax purposes, I'm not sure of the correct way to handle it however.


12

People "need" to know about finance for the same reason they "need" to know about medicine and law. These are complex issues that directly affect everyone, and individual circumstances vary, so there is no perfect one-size-fits-all solution. Governments in advanced societies generally try to arrange things so that most people can "...


10

Since it's family and friends that you are familiar with, you might offer to hire them to help each other out. This probably wouldn't work with strangers or acquaintances. If somebody is bad about cleaning their house, pay the person who needs the money to clean it for them. If someone's is healthy and the other not, hire one to do the yardwork. Childcare ...


10

The 'current price' listed on a public stock market for company stock is simply the last price where someone was able to sell their stock to someone else. This is generally a very good representation of current company value, but there are some caveats to using that as 'the value of the company': (1) For a company where minimal stock is traded (it is '...


10

Of course you'll be considerably wealthier in the long run (and the short run!) if you buy a reliable, low-cost car rather than an expensive, high-maintenance car. That's nothing but simple math. More importantly, it falls under the heading of "don't piss away your money just because you have a lot of it." The problem is that if you get in the ...


10

This sounds like a "reverse" sinking fund. In a typical sinking fund, where you save for the US$600 semi-annual car insurance payments, you save $100 every month for six months. But in your case, you need $100 now (the first full year), $80 in the second year, $60 in the third year, $40 in the fourth, and $20 in the fifth. After that, $0. I'd ...


9

Since you are over 59 1/2, you can withdraw money from your IRA for whatever purpose you like without the 10% penalty. You'll still need to pay income tax on the amount though, as the withdrawal will count as income. So be careful that you don't take out so much that you can't afford to pay the tax (and/or get a penalty for underpayment) when you file. It ...


7

It's the Fed (singular), short for the Federal Reserve, the US central bank. The Fed has unlimited ability to lend money and buy and sell securities. It electronically creates the dollars to do this. Normally it uses this power to control the short-term interest rate (which determines how cheaply businesses and consumers can borrow). But especially in a ...


7

The other answers give you essentially the correct response: after accounting for tax effects, $1000 applied to a high-interest loan saves you more than $1000 applied to a low-interest loan. However, there is one other minor issue that might push you to pay a (slightly) lower interest loan. It can be better to pay off loans that are either secured (on ...


7

Money doesn't fix money problems. Someone earning 50k a year and spending 50k a year has just the same problems as someone earning 500k a year and spending 500k a year. Give away resources (books, podcasts, fixed fee advisors, etc) and tell people that you're available for them if they need guidance or pointers of other valuable resources they can find for ...


7

I think that your source of information is conflating different things. Tea reading is one of dozens of methods of fortune telling. If you believe that the market can be predicted from any of these, man, have I got a bridge to sell to you. Regards from Miss Cleo, RIP. Astrology attempts to divine information about human affairs and other events by ...


7

The point of the credit score system for banks is to attempt to make every customer equally profitable. According to the rating agencies, a customer with a bad credit rating is statistically more likely to stop paying installments on their debt (which means a lot of hassle for the bank) or even declare personal bankruptcy. That means the bank loses money on ...


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