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EricGo
- Senior Member - 2K
posted: Nov. 11, 2003 @ 10:25a 
MYTH: If you have decided to invest in a CD, you should pick one closest to your anticipated withdrawl date.
FACT: Banks have different terms, but circa 11/04, typical fees for early withdrawl are 45 days of interest on CD's of six months or less, and 90 days of interest for any longer CD. Since the multi-year CD can have rates *much* higher than the six or 12 month varieties, it often makes good sense to pay the penalty when the time comes, and enjoy the high rate until then. |
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DrWu
- Senior Member - 1K
posted: Nov. 11, 2003 @ 3:29p
Agree with all previous posters; excellent thread. I have two to add. These might seem illogical to some of us, but I don't know how many times I've heard these myths.
1. Myth: I'll buy lunch for the whole table because it ends up costing me nothing. It's TAX-DEDUCTIBLE!!
Fact: IF the expenses are in fact deductible, they are an "above the line" deduction meaning they don't reduce your tax bill dollar by dollar. They only reduce the amount of income used in the calculation of your tax bill. To figure out how much of a "savings" your tax deductions really are, you have to take the deduction multipled by your tax rate (typically 25 to 28 percent).
2. Myth: I pay my CPA lots of money to do my taxes, but it's because he's always so good at "doing his magic" and getting me a refund in the end.
Fact: Non-tax preparers seem to always think there is some tax knowledge they can't find that is going to save them thousands on their tax bill when, truly, many individuals file a basic 1040 and have only basic itemized deductions. I find the biggest tax savings come from creating corporations and buying businesses and income-producing assets. There's no "big secret" to tax-savings. In addition, just because you receive a refund doesn't always mean you fared well. Those that are fooled by this should look at the "Tax Due" on their 1040's. |
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LordKronos
- Senior Member - 1K
posted: Nov. 17, 2003 @ 2:46p
I just stumbled on this thread browsing this forum for the first time. With the dropping interests rates lately, I've been helping quite a few people I know figure out whether they should refinance or not. Here are a few myths I ran into a several times in the process.
Myth: Rather than refinance my house to a lower interest rate, I'll just pay extra on it to pay it off faster.
Wrong. Do both. Refinance to a lower rate for the same period (or less), and then pay extra per month on top of it. You'll double up on the savings. The biggest mistake people make is taking a 30-year mortgage that they owe 20 more years on and refinancing it for another 30 years. That will cost you money. You want to refinance your remaining 20 years for a new 20 year loan at a lower rate. Or refinancing for 15 years instead of 20 might only cost you a few dollars a month, but it will also get you a better interest rate and save thousands of dollars over the life of the loan.
Myth: You pay mostly interest at the beginning of a loan/mortgage, so if you refinance, you'll just be starting over paying mostly interest again.
Not true. If you keep the balance and length of the loan/mortgage, and only decrease the interest rate, you will save yourself money.
Myth: It's not worth it for me to refinance because I plan on moving in a few years, and the closing costs/etc for refinancing will be more than I'll save.
While not strictly a myth, this is often faulty thinking. If interest rates have dropped, it's worth it to at least consider refinancing. Often people think they might move "within a year", and 3 years later they still plan on moving "within a year". Depending on interest rates, they could have recouped their costs and saved thousands of dollars more in that time. Figure out exactly how many months it will take you to recoup the costs and break even. Then seriously consider the likelihood that you will move within that time period. Consider that if you refinance and then move the next day, often you'll only be out $1000. However, if you fail to refinance and end up not moving, you could end up losing out on tens of thousands of dollars in savings. |
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fotomaniak
- Happy Member
posted: Nov. 17, 2003 @ 4:45p
Myth about the cars:
Myth: dealer can't sell the car below or at the invoice price, because invoice is what they have paid for the car.
Truth: they pay less, usually there 2-3% hold back that they get from the manufacturer plus bonuses for selling certain number of cars, in addition to that manufacturer may be offereing cash back to dealer and/or customer as a special promotion, which will bring price way below the invoice
Myth: if you lease a car you'll save money
Truth: no, if you only need a car for 3 years you better off financing it and selling(trading-in) after 3 years.
Myth: Dealer will give me lowest price on extended warranty
Truth: Dealers make huge profits on extended warranties(100% or even more) |
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fotomaniak
- Happy Member
posted: Dec. 9, 2003 @ 2:35p
Myth #: XYZ
If the deal looks too good to be true, it probably is |
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orphanis
- Senior Member - 1K
posted: Dec. 9, 2003 @ 3:59p
#27 is killing me!  |
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dquan97
- Senior Member
posted: Dec. 12, 2003 @ 3:56p
#13 MYTH: "I put my property in somebody else's name for tax or child support reasons"
Beware of IRS and other implications.
And that's the least of their worry...if they fail to comply with child support payments, they should be looking over their shoulder.... |
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noksagt
- Senior Member - 2K
posted: Dec. 12, 2003 @ 4:02p
Someone's wrong comment in a recent thread reminded me of a lesson from my college years:
MYTH:Financial Aid considers ALL assets. Investing before or during college is a waste.
The reality is that FAFSA excludes retirement accounts. This means annuities, 401(k)s and IRAs are A-OK & actually improves your chance at aid. Educational IRAs are an asset, though. |
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bssc
- Senior Member - 10K
posted: Dec. 12, 2003 @ 6:12p
Another Myth
There are secret ways to read the tax code / constitution / debt agreement which release you from your obligations but the courts / the bankers / the Bavarian Illuminati don't want you to know about your rights.
And for a small fee, we will explain them to you. |
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BunnyTubby
- Shopaholic Member
posted: Dec. 13, 2003 @ 4:33p
Is this true?
1. My apartment sent the cleaning fee to a collection agency directly (I didn't say I wouldn't pay.) I followed their direction and sent the collection agency the payment right away. Will that still hurt my credit score? |
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vrb747
- Senior Member - 1K
posted: Dec. 13, 2003 @ 8:01p
probably not unless they have already reported you as delinquent. check your credit report though.....
please feel free to correct me if Im wrong |
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harmonicer
- Member
posted: Dec. 13, 2003 @ 10:54p
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jcbnetwork
- Senior Member
posted: Dec. 14, 2003 @ 12:01a
I spoke to a few CSRs from several credit card companies and they all told me that "household income" means I could also count my spouse's income to figure out the total to list on the application. But they were very clear when stating that ONLY my spouse would count, other relatives should not be included. |
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SUCKISSTAPLES
- Charter Member
posted: Dec. 14, 2003 @ 4:57a
Which brings up yet another MYTH: "A CSR told me something, so it must be correct!"
FACT: CSRs, especially at credit card companies, are clueless drones and often dole out conflicting or incorrect information. Read the printed terms of your card agreement.
BunnyTubby said:
<< Is this true?
1. My apartment sent the cleaning fee to a collection agency directly (I didn't say I wouldn't pay.) I followed their direction and sent the collection agency the payment right away. Will that still hurt my credit score? >>
You should only send a collection agency $$ if they have agreed in WRITING not to report any negative information on your credit report (or agree in writing to remove the info if they already reported it)
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watssion
- Senior Member
posted: Feb. 11, 2004 @ 8:20p
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ccrzhh
- Senior Member - 1K
posted: Feb. 12, 2004 @ 10:03p
SUCKISSTAPLES said:
<< #2 MYTH: "I need to cancel some of my unused credit cards because I have too many"
This is a pervasive myth that has been addressed in several threads (found in the Credit Card FAQ). Once a card is opened, closing it will NOT help you. If a home/auto lender is concerned about you having so many unusued cards that they dont want to lend to you, they will simply ask you to close some accounts in order to get the loan. Dont take such action UNLESS you are asked to do so by a lender. Here is a good recent article
>>
SIS, you create your own myth: Credit card issuer or other (non-mortgage) lender will ask you to make something instead of plain notification "Your application is denied". Please add to the list
P.S. Overall, great thread! |
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zender
- Senior Member - 2K
posted: Feb. 13, 2004 @ 7:07a
watssion said:
<< good tread! >>
It's good alright, but I prefer Michelins. |
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ccrzhh
- Senior Member - 1K
posted: Feb. 13, 2004 @ 1:28p
zender said:
<< I prefer Michelins. >>
This is myth #20 "I think Quality and Price are explicitly related."
Check TireRack.com reviews and surveys - you will see better tires + lower price
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eightyk42
- Member
posted: Feb. 13, 2004 @ 2:29p
Bump. Good thread. Lots of helpful info. Thanks. |
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noksagt
- Senior Member - 2K
posted: Mar. 2, 2004 @ 11:01a
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