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Know How To Pay Down Your Mortgage In 12 Months



Mortgage payments are one of the heftiest recurring expenditures that one makes during their lifetime. According to LendingTree, around 10 million Americans aged 65 are still paying their mortgage payments.

Average stands at $1,100

The U.S. Census Bureau puts the average mortgage amount an American pay at $1,100. Thus, instead of paying huge sums over your lifetime, it is much more economical to aim to pay your mortgage as soon as possible.

Here’s how you can pay your mortgage in 12 months.

Read More: 7 tips to best use your social security checks

Getting in the mental state

The upcoming year that you decide to pay off your mortgage, is going to be full of sacrifices. You won’t be eating out or purchasing a ticket to your favorite game. So, do it in the month before you began to execute your payoff plan and get in the mental state to not do it for 12 whole months.

Manage monthly budget

Your ability to pay down your mortgage will be immensely affected by your ability to limit your expenditures to the most essential ones. So you need to start managing your monthly finances better. If you split your income in half for necessities and savings, around 50% should be left to you for your mortgage.

Work overtime

Working overtime is one of the easiest ways to earn an additional income according to Steffa Mantilla of Money Tamer. Other options include working on freelancing projects or getting a part-time second job. We never said paying off the mortgage in 12 months was going to be easy.

Bi-weekly payments

Make your payments bi-weekly rather than monthly. This helps you decrease the overall monthly interest that you pay on your mortgage and can vastly decrease the amount of time you need to pay back.

Make a lump-sum payment

If you have some accumulated wealth or your tax return has just come in, we suggest you try paying off a huge chunk by making a lump-sum payment. This will drastically reduce the time and amount you need to pay down the mortgage.

Adjust for inflation

Take note of the inflation in your country and your finances. Because in an inflationary scenario, while the mortgage payment remains the same, the value of money you pay is going to be less. So, you might lose money by paying extra every month. Further calculations are needed to make this decision though.

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Social Security

Consumer Confidence Low As President Joe Biden’s Opinion Polls Drop



The American economy is currently experiencing its highest inflation for the past 40 years. The record-high consumer price index is currently standing at 7.5% – up from 7% last month. This is the highest annual increase in the consumer price index since 1982.



The Stats Are In

Indeed, according to the New York Post, Americans are not happy with the state of their economy. Furthermore – they seem large, to be unhappy with the commander and chief as well – the American president Joe Biden. According to the University of Michigan’s consumer sentiment index, consumer sentiment is at the lowest in a decade. A separate poll showed that one-third of Americans do not approve of a single thing President Joe Biden has done whilst in office. The University of Michigan’s consumer sentiment – measures how optimistic consumers are about their future and their economy.

The latest index came in at 61.7 for February 2022. This is a huge drop of 19.7 percent since February last year and 8.2 percent since last month. Furthermore, it is also the lowest it has been since October 2011 when the index stood at 60.9.

American’s Hesitant About Their Future

As it stood Americans were only slightly optimistic about the economy. Furthermore, consumers seem to have a lot of fear or bad expectations about the future of the economy. This is indicated by the future expectations index which stood at 57.5 percent. This has been a huge 18.8 percent drop from last year – 70.7%, respectively.

Such a decline in these indices can be attributed to high inflation, which in turn leads to a more difficult economy and less confidence in the government and its policies. This tide together with the fact that the long-term economic outlook is at its worst in a full decade can also explain this phenomenon.

America Disproves Of President Biden

With the massive 7.5% increase in the consumer price index – the average household will have to add $276 to its expenses. Food, shelter, and electricity were the three highest contributors to the latest consumer price index. This is according to the Bureau of Labor Statistics. Perhaps, largely because of many of these aforementioned statistics, 58% of Americans have expressed disapproval for President Joe Biden’s performance whilst in office. One-third of those interviewed for the polls could not even site a single the president had done that they liked or approved of.

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Social Security

Closed-End Funds A Great Investment Choice For US Retirees: Know Its Advantages



Most retirees fail to save a decent amount from their retirement and Social Security benefits. Individuals in search of higher profits should consider investing in closed-end funds. However, these funds have higher risks with higher returns than conventional investment options. The closed-end funds provide stocks and bonds cheaper than the market price. CNBC reports that more than 500 closed-end funds were worth $296 billion by Jan 31. Mutual funds in the US are worth $24.3 trillion. Retirees need to understand the attributes of these funds and the probable downsides before investment.

Closed-End Funds A Great Investment Choice For US Retirees: Know Its Advantages

The Market Is Full Of Risks

The closed-end funds provide various shares at a lower value and enable the individuals to trade them in the stock market at the standard price. The share price depends upon the fund’s assets and the investor’s supply chain. The report suggests that the closed-end funds are usually sold at a discount. CNBC quoted Robert Finley, principal at Virtue Asset Management in Chicago, who said, “For fixed-income funds, we are seeing a little better returns…..sometimes because they are at a discount, anywhere from 3% to 10% of NAV. From our point of view, that provides some protection in a rising-rate environment. When the overall market tends to have a pullback, closed-end funds tend to get oversold. So we’ll look through and see if there are any specific areas discounted.”

Investors Need To Make Smart Choices

Several experts manage the investment of these funds, including stocks, bonds, and others; the funds derive profits every quarter each year. CNBC reports that 62% of the closed-end funds are bond investments. The market is volatile, and investors need to exercise caution during investment and trading. Investors should choose stocks with good market history and high-profit rates. CNBC reports that federal mortgages have a 3% to 5% return while corporate debts yield a 5% to 7% return. Experts advise against having more than 15% of the assets in closed-end funds. Investors need to look into the share prices and manage their trades smartly. The leverage for several closed-end funds varies greatly; it can also incur huge losses if not handled carefully.

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Child Tax Credit

Muni Bonds Come With Higher Medicare Premiums During Retirement



Municipal bonds are a primary choice among investors to evade taxes. The muni bonds can incur higher Medicare deductions from the post-retirement income. Individuals should be aware of the pros and cons of investing in muni bonds. CNBC reports that President Biden announced a probable increase in tax rates; this led to a higher demand for these bonds. The US muni mutual and ETFs are worth $96.8 billion at present. The government has not entertained the idea of a tax surge. However, the bonds still draw investors’ interests due to several unique attributes.

Muni Bonds Come With Higher Medicare Premiums During Retirement

Several Individuals Opt For Muni Bonds

Due to unexpected Medicare costs, the muni bond investment can be a bane for many investors. CNBC quoted Matthew Chancey, certified financial planner at CostalOne, who said, “There are a lot of moving parts, and you need to have someone look at it holistically.” The retirees should consider the higher Social Security tax and Medicare deduction before being awestruck by their high returns and present tax stability. CNBC reports that retirees with the Social Security payments and modified adjusted gross income (MAGI) above $44,000 (for joint filers) and $34,000 (for individual filers) are taxable for more than 85% of their Social Security income.

Medicare Premium Will Increase For Retirees Above MAGI Threshold

CNBC states that the Medicare Part B premiums have witnessed a 14.5% increase, to $170.10 per month. The threshold MAGI for retirees is $182,000 and $91,000 for joint filers and individual filers, respectively. Retired couples with MAGI above $75,000 will have to pay $578.30 under Medicare premium. The reports suggest the retirees may suffer more due to the increase in Medicare Part D, including prescription medicines. In the higher income bracket, retirees will have to pay $77.90 per month in 2022. The retirees need to calculate the deductions before investing in the bonds.

CNBC quoted Mary Kay Foss, certified public accountant and CPA faculty at CalCPA Education Foundation in Walnut Creek, California, who said, “It’s something that taxpayers seem so aware of because if they get into this higher bracket, they have to pay higher premiums for a full year.” Experts suggest that retirees should not give up on muni bond investment; instead, they need to consider all sides of the coin before getting their hands into it.

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