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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: accountclosed who wrote (35224)	11/4/1998 7:38:00 AM
From: Ilaine	Read Replies (3) \| Respond to of 132070

Antoine, I agree. I wish it were easier to work out the bottom line, though. I have tried Quicken, Quicken Financial Planner, and Microsoft Money, but I always have to pull out the financial calculator to work out the possible permutations of various financial decisions. Then there are the tax consequences. My solution to credit card problem is to use a Visa debit card, on my money market account. The bank pays me interest, and it works just like a Visa credit card in transactions like airline and hotel reservations, and on-line purchases. Doesn't give me a discount nor frequent flyer miles, but I never pay interest. If I can't afford something, I save up for it. CobaltBlue

To: accountclosed who wrote (35224)	11/4/1998 2:03:00 PM
From: Mama Bear	Read Replies (1) \| Respond to of 132070

"In the end it is the same. 22%, 18%, 16%...whatever it is. Is it smart to expect better returns in the brokerage account than withdrawing the money to pay off the credit card rates? " I guess it all depends on the interest rate and the level of debt service. I'm in no hurry to pay off my 7 1/2% mortgage, because I can easily exceed that in my trading account. But that is all the debt service I feel comfortable with. It would not matter to me if it were an unsecured (read credit card) loan if I had an equivalent rate. The 7 1/2% loan is of course tax deductible. As you say, it depends on the overall picture. I'm firmly in the camp that believes it's ok to borrow sensibly to increase income. Like risk tolerance in the stock market, it's an individual matter. "Is it smart to expect better returns in the brokerage account than withdrawing the money to pay off the credit card rates?" There are instances when it's a given. My husband's employer matches his 401k contributions 1:1 up to 6%. We could have stopped the contributions to the plan and paid off the debt much faster. I think you'll agree that it would have been imprudent to give up the instant 100% return on pretax money to retire debt with post tax money at even a 22% interest rate. Barb