Wednesday, November 21, 2007

Its bad!

1) Whole life, Universal Life, Variable Life, Variable Universal Life, or any type of life insurance that builds cash value. These are BAD products! If you spend time to research these products, you will see they are bad. Stick with term insurance.

2) Adjustable Rate Mortgages, Interest-Only Mortgages, Balloon Mortgages or any type of mortgages where your monthly payment is not fixed for life of the loan are BAD! If you plan to live in the house for the rest of your life or forever, get fix rate loans and make sure it says fix rate on there.

3) Leavings lots of money in your home is a VERY BAD idea. You are losing purchasing power and your money has no growth. Leaving lots of money in the bank is also a BAD idea since most banks give interest rates that are below inflation rate. Not only that, you also pay income taxes on the interest. Investing in tax-deferred mutual funds is a good idea as long as you know what you are doing.

4) Raising a family with no life insurance is a TERRIBLE idea. If you bring significant amount of income to the family and god forbids something happens to you, how would your family survive without your income?

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