I'll check the mailbox frequently. How about investing the BP dues,
too?
Steve Stokowski
-----Original Message-----
From: [log in to unmask]
To: [log in to unmask]
Sent: Mon, Feb 15, 2010 10:15 pm
Subject: [BP] This, my friends, is why we are going to send all our
401K's to
Steve to invest for us. c
In a message dated 2/15/2010 9:41:18 P.M. Eastern Standard Time,
[log in to unmask] writes:
Most people make purchases anyway, but justify the expense by calling
it an investment. Borrow $100 at the 2009 average mortgage rate of
5.0% per year. This costs you $5.00 per year. Or, invest the $100
in a no-risk US EE Bond at the 2009 rate, 1.2%, which is the general
convention. You would make $1.20 per year. The difference
( $5.00-$1.20) is $3.80, the cost of using the money . Divide $100
by $3.80. This = 26.3 years, or in about 25 years you spend as much
money on interest as the original value. In other words, if your
purchase lasts longer than 25 years, the cost of the money exceeds the
current value of the money. It actually takes less time to spend all
the money on interest since most individuals pay income taxes on
interest income.
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