What are your Financial Goals?
If you ask a typical upper middle class people (I am talking about High Income, low net worth group of people), about their financial goals than most of the people will tell you the following.
- Minimize the Tax burden by taking large mortgage loans
This is the prime financial goal of people living in USA and worldwide. They think that taking larger mortgage loans is a smart idea. Because it will reduce your tax liabilities and thus, you will save the tax.
But here my question is that, if these people are so much tax savvy that to save the tax they can even borrow money which is very dangerous, than why don’t these people budget their monthly expenses and save money from un ncessary consumer buying?
One of my friend has recently took a large mortgage loan to save taxes. But according to me, if he just budget his household montlhy finances tha he will easily save more money than saving on tax every year.
Most of the people focus on larger things. But they don’t focus on the smaller expenses. If you deduct few of your small expenses every year than you will save much more money than your interest payment on your home mortgage (Only Interest payments in mortgage loans are Tax free).
What I advise to people that, every month sit down with your spouse or family and write down each and every category expenses on a paper. Make category of each and every spending and write down expected spending in front of each category and compare it with actual expenses.
I know that this is very boring. And I personally myself find it very boring exercise. So what I suggest you is that, find out some alternative methods of budgeting your expenses like me such as “Pay Yourself First” method or “Budgeting on Excel spread sheet or something else….
But in any case, budget your finances…
If you ask a typical upper middle class people (I am talking about High Income, low net worth group of people), about their financial goals than most of the people will tell you the following.
- Minimize the Tax burden by taking large mortgage loans
This is the prime financial goal of people living in USA and worldwide. They think that taking larger mortgage loans is a smart idea. Because it will reduce your tax liabilities and thus, you will save the tax.
But here my question is that, if these people are so much tax savvy that to save the tax they can even borrow money which is very dangerous, than why don’t these people budget their monthly expenses and save money from un ncessary consumer buying?
One of my friend has recently took a large mortgage loan to save taxes. But according to me, if he just budget his household montlhy finances tha he will easily save more money than saving on tax every year.
Most of the people focus on larger things. But they don’t focus on the smaller expenses. If you deduct few of your small expenses every year than you will save much more money than your interest payment on your home mortgage (Only Interest payments in mortgage loans are Tax free).
What I advise to people that, every month sit down with your spouse or family and write down each and every category expenses on a paper. Make category of each and every spending and write down expected spending in front of each category and compare it with actual expenses.
I know that this is very boring. And I personally myself find it very boring exercise. So what I suggest you is that, find out some alternative methods of budgeting your expenses like me such as “Pay Yourself First” method or “Budgeting on Excel spread sheet or something else….
But in any case, budget your finances…
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