I Just Spent 0,000

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How’s it going everybody this is pete the bush today i’m gonna talk about how i spent $60,000 this month of course have you been watching this channel you probably already know that i did not blow this $60,000 on frivolous things nor did i buy a very fancy car what i did with this of course is i did something very very boring which is pay down the mortgage a portion

Of this money did come from bitcoin and a portion of it also came from my personal cash holdings now you have $60,000 laying around you may not choose to voluntarily prepay your mortgage because there are other things that you can do with it for me i’m in a slightly different position because recently i quit my job therefore i don’t have a very major source of

Income however i am looking to aggressively playing down and i soar to see the light at the end of the tunnel already now having a mortgage is a huge burden by itself for me i have to pay close about $2,000 every single month when you place this constraint on someone it means you have to make at least this much so that you don’t get kicked out of your house and you

Know start living in the streets for me personally i feel a little bit trapped by this house there’s various things that you have to do in order to sort of get the authorities off your back the first really annoying thing that i’ve noticed is that the mortgage company requires you to update your insurance for some reason they don’t actually automatically update it

Itself because the hoa has this insurance thing and then you have to somehow ask them for this insurance every single year and then take this insurance up load it so then it’s like a really annoying thing because they put a time limit on it and if you don’t do it you know you’re gonna get in trouble or somehow they’re gonna find you or whatnot the second thing of

Course is the property tax if you fail to pay your property tax for sometime of course the irs is gonna garnish your wages or something they’re gonna do something to make sure that you pay your taxes but that thing in itself it’s a little bit obnoxious than the mortgage company because when they ask you all you got to update your insurance or something it takes

Quite a bit of work i think it cost me somewhere between 30 minutes and then like two or three rounds of back and forth with the hoa to ask them for papers and then i have to feed it back to the mortgage company property tax is not as offensive to me because they mail you the bill really early on and then you is essentially have many many months to pay it before

It’s actually do you know how much it’s gonna cost as you just as long as you send in the money then you’re basically off the hook and you know no one’s gonna come bother you having a house in an area where there is hoa is also a really annoying thing because if you want to change the windows or something if you have some decoration left on for too long they actually

Come after you and if you don’t follow the rules i think you get like a three-strike thing then they also find you for some reason so this in itself it’s sort of like requirements that’s placed on you and you sort of have to do something like this and whenever you have to do something i personally feel a little bit trapped so with $60,000 i feel like the majority

Of the population will start eyeing a brand new car or something maybe they want to brand new tesla model 3 or something which you know you can’t afford with that amount so putting $60,000 into the mortgage it’s a bit boring but the way i see it is every $10,000 i put into it i’m gonna save $350 in interest payments for $60,000 this works out to be about $2,100

Every single year so me putting this money into it i’m going to increase my net worth for about $2,100 every single year from this point on forward now i personally wrestled with thinking about taking this money and investing it instead because hey you know if you invest it instead it’s going to be way more than 3.5% or so in fact you’re not really paying 3.5%

Because after tax deductions and things like that it’s really closer to about 2.7 percent that you’re paying so investing this in the stock market is likely going to gain you more than two point seven percent pretty easily so the things i think about here is having a home paid off is actually priceless it’s like not having the guillotine just kind of hanging above

You and you know if you happen to miss two or three payments it’s just gonna come down chopping and you’re gonna end up on the streets so i put this as a pretty high priority if you think about this when you pay down your mortgage partially you do get the benefit of not paying any more interest on that amount however you do not get the full benefit of absolutely

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Having no mortgage payments at all so in a way it might be good to hold on to the cash before you’re able to completely pay it off and invest it instead you know a little bit conservatively so you don’t have too much principal risk personally i’ve been holding a little bit of cash inside a california municipal bond where it’s actually tax-free it gives you about

A five point nine percent dividend however it when i really think about this i’m like okay yeah it’s gonna give me you know a bit of a dividend here and it did actually increase about ten percent from the principle that i put in as time goes on there will be principal risk and you have to think about hey you know you can pay it off right now why don’t you should

You just hold on to this and there could be principal risk like i said and maybe it could dip to a point where you can no longer pay off their mortgage and falls before you have the full amount of your mortgage you hold on to this investment make more gains than the interest payments that goes into your mortgage therefore the act of holding this will actually earn

You more money and then when you have the full price of the mortgage balance plus one year of emergency savings or not then you can take this amount and suddenly boom plop it all in because it’s good to actually hold on to this extra amount of money because maybe there could be a housing downturn or something and in the process you might want access to this cash

So let’s say as i’m holding on to this amount and i’m not quite ready to completely pay off the house in full the housing market crashes then i have this chunk of money then i can just immediately liquidate this and use it as a down payment on the brand-new house once that threshold is reached where you have enough to pay off the house completely and a bunch of

Emergency savings one year two year or what not then you might want to think about hey you know instead of you know holding on to this money in a risky investment not very very risky but there is some risk instead of risking it you can just go okay you know forget about this i’m just going to pile it all in into your primary residence pay it all off it’s gonna be

Completely gone you don’t have any mortgage interest anymore and i don’t know having a home paid off in full is likely very priceless but in the meantime i might not have completely followed what i said because i have been paying into my mortgage a little bit at a time but recently i’ve been a lot more aggressive about it because i’m you know trying to shoot for

The end of the tunnel here trying to pay down everything and in the meantime i did invest some of this money one time in ixc is a etf oil fund in united airlines ual which did well you know i think it was six months backward an increase i sold it a little bit too early i am currently holding onto a bunch of pck which is california municipal bonds that’s where i

Sold a portion of it so that i can put that 60 k into the mortgage at some point before i also bought into pck when it was really low when it increased to about $11 i was like man this is way too high there’s too risky here because um it’s the highest it’s ever been within five years or so so then i sold it and some months later it dipped down much lower and then

I’m like hey you know it’s cheap again so then i bought back into it and since i buy i think two years ago it’s came back up right now it’s about ten dollars eleven cents or so and i’ve been holding on to it and i feel like the longer i hold on to this the riskier it’s gonna be because i don’t want to lose the principle i have an opportunity to be able to pay more

Into my mortgage it’s increased so i can take profits off of the gains of the principle already so selling pck and paying into the mortgage would mean that i would get less risk however i would not get as much gains because the delta here between paying off a mortgage i don’t have to pay 3.5% interest – the deductions which is three point two point seven percent

Let’s just say the mortgage is about effective 3% and then pck is about effective 6% so by doing this i’m actually losing 3% of you know gains every single year for whatever amount i convert and put into the mortgage now you have to think about 3% is that worth it to hold every single year if possibly maybe next year maybe the principal could go down by 10% so if

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It goes down 10% i essentially have to wait about three years to recuperate the losses from you know any kind of downward price movement of this municipal bond moving on i did talk about using a service called the plastic service where you can use this to churn credit cards since i covered this service they’ve eliminated visa and american express payments into your

Mortgage with these credit cards so i can no longer go around getting those credit cards anymore and turn them very easily through the referrals you guys have given me a lot of fifi transfer so i basically have many thousands of dollars that i have to use in order to just kind of get rid of them you can’t still get discover and mastercard and turn those but without

Access to visa and american express it makes things a lot harder because american hex express has american express gold the delta airlines spg card i got a lot of cards at our visa and american express that i got a lot of benefit from from using the plastic service and i just got really lucky because i happen to use all of those i happen to turn all of those in

The month prior to them making over this change so having many thousands of dollars of fifi transfers i feel like mastercard and discover are eventually going to plug this up and basically not allow you to pay mortgage with those credit cards as well so in anticipation of this i cannot get any credit cards for another year or so so i’m not gonna sit around and

Just sit on those fifi transfers for what i did was i basically use this plastic service to pay some of the mortgage through a citibank double card so every single thousand dollars has essentially worth twenty dollars it appears in my rewards in my city double card because i just go okay you know my credit limit in citi double is a couple thousand dollars so i’m

Going i’m gonna charge three thousand dollars on it and then i’m gonna pay it off right away and you can just keep on charging it pay it off right away and you know you can do this many many times every single month so every $3,000 is about sixty dollars in rewards and i just keep on doing this until i used up all of my fifi transfers basically if i don’t have a

Mortgage it will be very difficult for me to spend these fifi transfers so in light of these fifi transfers it might be actually a good thing to keep you know some amount of mortgage there just in case i get some referrals or something so that i can funnel it through a city double and then pay it off and get you know two percents if you look at a giant mortgage is

Hundreds of thousands of dollars and if you can just extract 2% from this whole thing just from getting fefe transfers then you know two percent of a really large sum it’s a large amount of money so i hope this reasoning process is good for you because it took me a really long time of actually living it to kind of figure out what the proper process is i’m just

Keep on thinking oh should i pay down i should pay down i don’t really want to pay like twice the amount of the original mortgage because if you just pay the minimum for 30 years yeah your mortgage is gonna basically double you borrow $300,000 at the end of 30 years it’s like another 300 on top of that and i look at the interest payments i paid on it i’m like oh

My gosh that’s a lot of money just burnt up i prefer to not have paid that of course so in summary i probably did it in kind of a messy way because whenever i feel like paying more mortgage i’m like okay i’m just gonna put a little bit in there i don’t want to put everything in there so i should put a little bit so it’s kind of like not concentrating all your eggs

In one basket so imagine if i completely paid the minimum on the mortgage right and i take every single dollar i have instead of paying in the mortgage i invested instead and maybe i did very bad then that won’t be as good because i could have just paid a little bit more into the mortgage so today over here i have received my second piece of fan mail yay look at

This is from japan in the back i think these are called melo d twins it’s been interesting these days because i really feel like i need to open up these things on camera rather than just rip it open because that’s my first once i get this i’m like oh i want to see what’s inside so i’m very excited thank you gene for sending me this letter i don’t get letters very

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Often i’m gonna open it i really wonder – what can anyone send me am i supposed to read this i’m not sure what the heck this is a dragon ball facemask oh look at this cool waves 3d there’s a bunch of charlie brown on it well and it can stand up i can sort of like can i put it like this so i guess i’m gonna read this and if it happens to say don’t read it and i’ll

Have to cut it out dear beat the bush happy to have discovered your channel recently you really change the way i think about personal finance and money in general i especially enjoyed your credit turning tips and have been having fun doing it with the added challenge of dealing within japanese wow i didn’t know you can actually do this in japan – only if they offer

The signup bonuses as good as in the u.s. of course keep honey badging those haters into 2018 best wishes gene oh okay so um youtube handle psi previously sent you this face mac in the hopes that you’d wear it on your youtube channel but i understand if you don’t want that on camera well gene i’m actually not afraid of wearing a face mask i’ve learned these before

But i have never worn one on camera before and i hope maybe it’ll be in the shape of dragonball shape here it is i can’t read the japanese on it but i don’t know what this character is called either hold on while i go adjust this in the restroom so actually took me a long time to come to this realization that as i’m earning money i should be saving enough for an

Emergency fund and i prefer actually more than one year of emergency fund two years three years or more but once you satisfy this emergency fund you’re gonna have extra money and you need to decide what you’re gonna do with it are you gonna invest it or are you gonna prepare your mortgage so what i ended up doing is i think it might be a good thing to pay a little

Bit into your mortgage sort of like diversify your risk so you look at your portfolio and you go okay i have this much where can i put some of it where would i put a guaranteed gain of 3.5% well you know maybe 10% is worth it so i would just chop off 10% of you know your portfolio all the new money that’s coming in chop off 10% and use this pay into your mortgage

So it’s not quite like as aggressive as you know other recommendations where people go okay any amount on top of your one-year emergency fund you completely stick this into your mortgage i probably made off with a little bit more gains doing whatever i did rather than just you know going straight to pre paying the mortgage i do realize everyone has a different risk

Tolerance so you know this is a good way to look at things but with all new money that’s coming in over and beyond your one year of emergency savings or whatever number of years that you prefer whatever new money coming in you want to decide okay how much are you going to put towards pre pain your mortgage how much are you gonna invest it maybe some people they want

To take one hundred percent and invest all of it and just you know forget about that mortgage you just pay minimum but when you do pay minimum you’re gonna rack up your interest over the life of that loan you’re also not gonna be as close to paying off your mortgage in full so thanks for watching i hope this rambling gives you clarity on what you should do with your

Extra money should you pay more into a mortgage did you try to invest it thank you jean for this mask and also for this card over here don’t forget to give me a like on this video comment down below let me know if this video helps you figure out if you should prepay more into your mortgage or invest more or maybe a little combination of both if you’re interested in

Supporting my channel check out my audible link down in the video description below where you can get a free audiobook and you like this audiobook you can cancel it before the subscription expires you can still keep this audiobook and helpin if it this channel i also have a patreon link over here where you can get perks such as spreadsheets i’ve used in the past

Videos you can also get perks such as help of your credit score or help with your finances and as always don’t forget to subscribe to my channel over here and click that bell icon next add a subscribe button so that you get a new notification whenever i upload a brand new video thanks for watching this smoother now it’s master really good i wish i can read the ingredients on this thing

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I Just Spent $60,000 By BeatTheBush

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