Payoff debt first or Investing ???
Hey everyone, over the last two years or so I have been trying my hand at wholesailing with no real success, now I was at one point in time one of those newbies who was gullible enough to believe that you don't need any money to invest or wholesale or any other thing associated with real estate, which I have learned over the past two years is just not true. With the little money I do have to commit to my small marketing campaigns I have come to a little bit of a fork in the road, I have come to the conclusion that maybe if I first focus on paying off all of my debts that I can actually have more focus in the future on my real estate investing/ wholesailing when I actually have the cashola to spend. Now I know there are a great number of people here with wisdom and knowledge, so I would like to ask would you focus on investing and paying down consumer debt ? or would you just focus on paying off debt first with the thought process of being able to focus more on real estate investing in the future because your cash position will be a whole lot stronger without consumer debt.
The reason for this question is because I feel that the little bit of money I have to commit to my marketing campaign may not be effective enough, and I'm seeing more cash going out than coming in and with this consumer debt on my back I feel it would be more of an advantage to payoff the debt now so I can commit more marketing dollars later. What would you suggest ????
Comments (2)
Eileen thank you so much for your advice, I am sorry I did not get right back to you, I'm still getting use to writing blog post and I just realized you left me a comment. I will check out David Bach's Automatic Millionaire seems like some great info to read.
Perry Apawu, over 11 years ago
Hi, I am new to the forum. I am presuming that you are talking about credit card debt, car and/or student loans so yes I would pay them off, especially if they are a significant portion of your monthly outlay. First thing to do is analyze the interest rates you are paying and call the credit card company to negotiate a lower rate, usually they will work with you. In your shoes I would pay off any outstanding debt that has a high interest rate. If you are in the last year of a car loan you might not want to accelerate that since you are paying very little interest at this point. It's nice to get the student loan monkey off your back but if the rates are low you might be better off to start creating a rainy day fund so you can pay for unexpected expenses with out having to put them on your card. David Bach has a book called the automatic millionaire which has some really great advice on getting out of debt. His Automatic Millionaire Homeowner has a conservative approach to going from renting to owning a home to owning multiple properties. I do tend to be conservative about debt that is not investment related. I hope this is helpful. Good Luck Eileen
Eileen Murphy, over 11 years ago