Compounding Explained in a “Not Boring Way”
It sounds like a word they would use on a farm.
As in, “I’ve got some compounding to do down on the back forty so I won’t be able to shuck corn with ya this afternoon”.
In reality, compounding is just one more of those financial terms that many have heard, but few can explain. The first thing you should know about compounding is, obviously, that it is fun to say. The second thing you should know about compounding is that it can be both a force of good and a force of evil in terms of your finances.
Don’t Buy a Home for Financial Reasons: Your Home is Not an Investment
The “American Dream” is different for each of us, but there is one common thread. It has been drilled into our heads for decades that a part of the “American Dream” is to own your own home. Add in HGTV home remodel shows, Youtube videos about making money in Real Estate and historically low interest rates (driving up home prices while keeping mortgage payments down), and you have a recipe for irrational excitement around home ownership.
The Power of a High Savings Rate
In the first post of this series (“Making A Game Out Of Budgeting”), we talked about focusing on Savings Rate. Today, I want to dive a little deeper into the Power of a High Savings Rate.