Updated on January 14, 2008
To buy my dream house
I just went to see a model unit in my dream city last week. Die Broke: A Radical Four-Part Financial Plan recommends buying your second home first, so I chose the 3-bedroom unit. When I saw the payment schemeâ€¦ weâ€™ve got a LOOOOONG WAYS TO GO.
Weâ€™d probably get a mortgage. How exactly, I donâ€™t know yet. Same as with credit cards, personal loan requirements would require business owners to show financial statements showing profits for 2-3 years. We start operations in 2008 â€“ so the soonest I can get my house is in 2011?
In the meantime, I have to save for a downpayment of $70,000 in 4 or 5 years time, net of inflation. Iâ€™ve already cut my expenses to the bare essentials and my level of savings right now isnâ€™t enough to hit that target so my topline has to be adjusted. I have to earn extra and from that incremental, invest 1/3 back into the business, 1/3 in a high-yield investment with a horizon of 5 years, and 1/3 in balanced funds.
If I make an extra $2,000 per month and invest 2/3 or $1,333.33 at 12% p.a., compounded every quarter for 8 years â€“ I manage to get my $70,000 downpayment â€“ but come on, 8 years!!! H01y$(*#$(!!! There must be something wrong with my arithmetic. But I just followed the FV equation in Excelâ€¦ sigh. Our business better pick up soon.
Iâ€™ll be joining a foreclosed properties meetup this Saturday, January 19, 3-5pm at Gloria Jeanâ€™s Coffee in Robinsonâ€™s Galleria. Maybe thatâ€™ll get me some extra moolah.
If you’re interested in viewing the model units and getting your own, you can contact Jean Azucena, Property Consultant at (+63) 927 860 3414