The Automatic Millionaire
Meet the Automatic Millionaires
The book begins with the author David Bach meeting Jim McIntyre after one of his investment classes. Jim requests to meet the author to review their financial situation and the meeting is set. Mr. Bach is amazed as he looks through the McIntyre’s finances and the conversation switches from looking at their situation to asking how they’ve done what they’ve done. What the McIntyres told the author has help himself and many others through this book become automatic millionaires.
“A latte spurned is a fortune earned.”
The first chapter of the book makes it sound simple enough to become an automatic millionaire, but where does one ...view middle of the document...
A Rainy Day
An emergency fund is also an important step. First one must decide to set up an emergency fund as well the amount to set aside. Another thing pointed out is the opportunity to make this money work for you. Make sure the money isn’t too accessible otherwise it is very tempting to dip into it. The author suggests a money market account or U.S. savings bonds as vehicles to use for this occasion. Once established make adding to the account automatic.
This chapter is all about the benefits of owning a home. Renting doesn’t lead to equity and is a less productive use of your money. Using a mortgage acts like high-end investors using leverage, using someone else’s money to work for you. David Bach also brings up a good way to pay down your mortgage quickly. By making biweekly payments instead of monthly payments, you essentially make 13 monthly payments each year. The tricky part is making biweekly payments automatic. Many banks will not accept the payments so one must use an outside source. Make sure you ask your bank if they offer a way to achieve this, if not ask if they can refer you to a company that does.
There are both good and bad types of loans. Credit cards are of the bad type. With their high interest rates and suggested minimum payments, a credit card user could end up paying off their debt for life. The best thing to do is to stop carrying them altogether. Call up the credit card company and try to renegotiate the interest rate and consolidate all the cards into one account. Pay...