How Improving Personal Credit Helps a Homeowner's Retirement Plan

How Improving Personal Credit Helps a Homeowner's Retirement Plan

You hear about the “lowest mortgage interest rates since 1939” in the media, billboards and newspapers.  If you own a home, refinancing your can free up monthly cash flow to pay off consumer debt or save towards your kid’s college and retirement plan.  Why should the bank be the beneficiary of not being able to get this done, with bad credit keeping you in financial handcuffs?

Here’s a scenario from a listener to our weekend radio show, whom we met later in the week for a financial coaching review and months after improving their personal credit. 

They had a $250k mortgage @ 7% interest, paying $1900+/mth.

His plan was to have his house paid off by the 26th year.

Creating a New, Refreshed Personal Economy

After reviewing their personal credit report, they requested the credit bureaus to remove resolved items that still appeared after the last two years during a rocky career transition.  Then he was able to refinance his mortgage @ 5% interest, thereby lowering his mortgage payment to $1600/mth … a savings of $300/mth.

Instead of spending this $300/mth without any plan in place, he redirected this monthly amount to plug gaps in his financial plan.  This allowed him to properly obtain life insurance and SAVE towards his own retirement plus his kid’s college plan for the next 20 years.

Their end result and new future financial picture? 

  • They are able to redirect $72,000 back into their personal financial stimulus package after improving their credit.
  • After earning an average of 8% compound interest over the next 20 years, another $105,884 is put back into their pocket, instead of the banks!

You can either make money work for you or for someone else.  Breaking down the barriers in which damaging personal credit can affect our daily life, will allow us to unlock a path towards financial independence, full speed ahead!

What are your thoughts about rethinking how our credit and managing your mortgage brings MORE money to you?  Your story?  Tweet us or drop a comment on our community page too!

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