How To Own Your Paycheck Again!

102 Pages·2008·0.46 MB·English

How To Own Your

Paycheck Again!

By
Leo J. Quinn, Jr.

This publication is not intended for use as a source of legal, accounting, or tax advice. All users are advised to retain the
services of competent professionals for legal, accounting or tax advice. The author and publisher assume no
responsibility or liability whatsoever on the behalf of any purchaser or reader of these materials.

Leo J. Quinn, Jr.
PO Box 2423
Ballston Spa, NY 12020
518-857-6346
[email protected]

Copyright 2008 Leo J. Quinn, Jr. ALL RIGHTS RESERVED.

No portion of this publication may be reproduced, stored in a retrieval system or transmitted
in any form by any means, electronic, mechanical, recording, photocopying or otherwise
without prior written permission of the above copyright holder.
How to Own Your Paycheck Again, by Leo J. Quinn, Jr. 2
Copyright 2008. All Rights Reserved.
TABLE OF CONTENTS

Introduction........................................................................................5

PART I: Ten Reasons Why You Don’t Own Your Paycheck Now

Chapter 1...........................................................................................7
Thinking A Single-Family Home is YOUR Answer to the American Dream

Chapter 2...........................................................................................16
Not Understanding How Really Harmful A Mortgage Can Be

Chapter 3...........................................................................................18
Not Keeping Track Of Expenses

Chapter 4...........................................................................................21
Being In Debt AND Having A Savings Or Investment Account

Chapter 5...........................................................................................23
Not Reading Or Understanding The Fine Print

Chapter 6...........................................................................................27
Not Doing The Math

Chapter 7...........................................................................................28
Having A Great Need To Spend Any Increase In Income

Chapter 8...........................................................................................30
Having Too Much Money Withheld From Paychecks

Chapter 9...........................................................................................31
Just About Anything To Do With Buying A Car

PART II: How To Own Your Paycheck Again (Outta Debt System)

Chapter 10.........................................................................................35
Thinking That Paying Off Your Highest Interest Rate Debt First Is The Fastest Way To Get Out Of
Debt

PART III: How To Own Your Paycheck Forever – Get Savvy!

Chapter 11.....................................................................................49
Credit And Debit Cards

Chapter 12.....................................................................................52
All About Credit Reports—DON’T READ THIS!!

3
Chapter 13.....................................................................................59
Houses And Mortgages, Oh My

Chapter 14.....................................................................................62
Death and Tax Refunds: Not Always Inevitable

Chapter 15.....................................................................................64
Major Purchases: Do Your Homework

Chapter 16.....................................................................................67
Messy People Aren’t Rich…Or, Why Their Accountants Are Neat Freaks

Chapter 17.....................................................................................74
Savings and Investments: You Need ‘Em, So Get Started

Chapter 18.....................................................................................77
Unexpected Challenges And How To Overcome Them

Chapter 19.....................................................................................82
Using Your Computer to Run Your CFO (Chief Financial Office)

Chapter 19.....................................................................................86
A Simple And Fun Money Management System

Chapter 21.....................................................................................89
Bankruptcy, The Last Resort (Which Is Why It’s The Last Chapter)

Appendix A........................................................................................91
How to Find Your Headstart

Appendix B........................................................................................ 97
FAQ’s

Conclusion......................................................................................... 100

Recommended Reading.................................................................... 101

How to Own Your Paycheck Again, by Leo J. Quinn, Jr. 4
Copyright 2008. All Rights Reserved.
INTRODUCTION

Like other people who write books about mistakes, I made most of these myself.
Some I was fortunate to discover before making them, so I owe a debt of gratitude
to those who went before me and were honest about the mistakes they made.

Since 1997 I have been teaching a class on personal finance at school districts
and community colleges throughout New York and Massachusetts called “How to
Own Your Paycheck Again!”. The focus of this class has been debt elimination but
it has become clear to me that so many of these problems could be avoided with
intelligent financial education.

There is a lot of financial advice out there today. Despite all this “good” advice
government statistics tell us that only about 4% of Americans will retire with any
sort of stability. Most rely on Social Security as a major supplement to their
retirement income.

Watch the news the next time there is a delay in the direct deposit of Social
Security benefits. Millions of Americans will be distressed because they have no
money to buy groceries.

These are the same people who during the course of their entire working life
earned from $500,000 to $2,000,000. Where did it all go?

This tells us that much of the financial information we accept as “gospel” is wrong
AND dangerous.

In this book I’ll point out some of the more common misconceptions that are
hurting Americans every day.

Among the information that will probably surprise you is…

*A single-family home is the worst possible investment a young family can make.

*Paying off high-interest rates first is the slowest way to get out of debt.

*Pay raises can cause more trouble than they are worth and much more.

Please keep an open mind as you read. Remember that over 95% of Americans
end up financial failures thinking the very same things you have always been
taught. I’m presenting an alternative that is mathematically sound and provable,
not just my opinion.
5
PART 1

TEN REASONS

WHY YOU DON’T

OWN YOUR PAYCHECK

NOW
How to Own Your Paycheck Again, by Leo J. Quinn, Jr. 6
Copyright 2008. All Rights Reserved.
CHAPTER 1

Thinking a single family home is YOUR answer to the
American Dream.

The fact is a single family home turns into most people’s financial nightmare.
Here is the typical thinking of someone considering a home purchase:

“I’m paying $600 in rent and not getting anything for my money. If I get a mortgage
payment of $600, I’ll have my own place and be building equity instead of making
my landlord rich!”

OK so far? Sounds logical, doesn’t it?

Here are the facts:

That $600 mortgage payment does not include PROPERTY TAXES.

That $600 mortgage payment does not include FURNITURE you must buy
because this house is a bit bigger than your three-room apartment.

That $600 mortgage payment does not include PAINT, WALLPAPER AND
CARPETING that you will want to replace because you hate what’s there now.

That $600 mortgage payment does not include the increase in your UTILITY bill
because you’ll be using more heat and electricity in this big house.

That $600 mortgage payment does not include the APPLIANCES you’ll have to fix
or replace, instead of simply calling that “rich” landlord.

That $600 mortgage payment does not include any number of other expenses that
you as the homeowner will be responsible for now.

Most people can barely scrape enough money together to buy the house, so most
of these expenses will be financed how? D-E-B-T.

Let us conservatively estimate that all these expenses will DOUBLE the amount
you pay for housing.

Instead of $600 to a landlord you are spending $1200 for your own home. But you
are building equity, right, which makes it all worthwhile?

Check again.
7
On the following pages you will find a mortgage amortization chart for a
$100,000 mortgage at 7% for 30 years. If you have a mortgage, go get your
amortization table now. If not, look at the “building equity” myth here:
Mortgage Amortization Table
$100,000 Mortgage 7% Interest
Payment Payment Interest Principal Balance
Number Amount Amount Reduction Due
1. $665.31 $583.33 $81.98 $99918.02
2. $665.31 $582.85 $82.45 $99835.57
3. $665.31 $582.37 $82.93 $99752.63
4. $665.31 $581.89 $83.42 $99669.21
5. $665.31 $581.40 $83.91 $99585.31
6. $665.31 $580.91 $84.39 $99500.91
7. $665.31 $580.42 $84.89 $99416.02
8. $665.31 $579.93 $85.38 $99330.64
9. $665.31 $579.43 $85.88 $99244.76
10. $665.31 $578.93 $86.38 $99158.38
11. $665.31 $578.42 $86.89 $99071.49
12. $665.31 $577.92 $87.39 $98984.10
13 $665.31 $577.41 $87.90 $98896.19
14. $665.31 $576.89 $88.41 $98807.78
15. $665.31 $576.38 $88.93 $98718.85
16. $665.31 $575.86 $89.45 $98629.40
17. $665.31 $575.34 $89.97 $98539.42
18. $665.31 $574.81 $90.50 $98448.93
19. $665.31 $574.28 $91.02 $98357.90
20. $665.31 $573.75 $91.55 $98266.35
21. $665.31 $573.22 $92.09 $98174.26
22. $665.31 $572.68 $92.63 $98081.63
23. $665.31 $572.14 $93.17 $97988.46
24. $665.31 $571.60 $93.71 $97894.75
25. $665.31 $571.05 $94.26 $97800.50
26. $665.31 $570.50 $94.81 $97705.69
27. $665.31 $569.95 $95.36 $97610.33
28. $665.31 $569.39 $95.92 $97514.41
29. $665.31 $568.83 $96.47 $97417.94
30. $665.31 $568.27 $97.04 $97320.90
31. $665.31 $567.70 $97.60 $97223.29
32. $665.31 $567.13 $98.17 $97125.12
33. $665.31 $566.56 $98.75 $97026.37
34. $665.31 $565.99 $99.32 $96927.05
35. $665.31 $565.41 $99.90 $96827.15
36. $665.31 $564.82 $100.48 $96726.66
37. $665.31 $564.24 $101.07 $96625.59
38. $665.31 $563.65 $101.66 $96523.93
How to Own Your Paycheck Again, by Leo J. Quinn, Jr. 8
Copyright 2008. All Rights Reserved.
Payment Payment Interest Principal Balance
Number Amount Amount Reduction Due
39. $665.31 $563.06 $102.25 $96421.68
40. $665.31 $562.46 $102.85 $96318.83
41. $665.31 $561.86 $103.45 $96215.38
42. $665.31 $561.26 $104.05 $96111.32
43. $665.31 $560.65 $104.66 $96006.66
44. $665.31 $560.04 $105.27 $95901.39
45. $665.31 $559.42 $105.88 $95795.51
46. $665.31 $558.81 $106.50 $95689.00
47. $665.31 $558.18 $107.12 $95581.88
48. $665.31 $557.56 $107.75 $95474.13
49. $665.31 $556.93 $108.38 $95365.75
50. $665.31 $556.30 $109.01 $95256.74
51. $665.31 $555.66 $109.64 $95147.10
52. $665.31 $555.02 $110.28 $95036.81
53. $665.31 $554.38 $110.93 $94925.88 Paying for 5 years now.. 83% of
54. $665.31 $553.73 $111.57 $94814.31 your payment STILL goes to pay
interest charges!!!!
55. $665.31 $553.08 $112.23 $94702.08
56. $665.31 $552.43 $112.88 $94589.20
57. $665.31 $551.77 $113.54 $94475.66
58. $665.31 $551.11 $114.20 $94361.46
59. $665.31 $550.44 $114.87 $94246.59
60. $665.31 $549.77 $115.54 $94131.05
61. $665.31 $549.10 $116.21 $94014.84
62. $665.31 $548.42 $116.89 $93897.95
63. $665.31 $547.74 $117.57 $93780.38
64. $665.31 $547.05 $118.26 $93662.12
65. $665.31 $546.36 $118.95 $93543.17
66. $665.31 $545.67 $119.64 $93423.53
67. $665.31 $544.97 $120.34 $93303.19
68. $665.31 $544.27 $121.04 $93182.15
69. $665.31 $543.56 $121.75 $93060.40
70. $665.31 $542.85 $122.46 $92937.94
71. $665.31 $542.14 $123.17 $92814.77
72. $665.31 $541.42 $123.89 $92690.88
73. $665.31 $540.70 $124.61 $92566.27
74. $665.31 $539.97 $125.34 $92440.93
75. $665.31 $539.24 $126.07 $92314.86
76. $665.31 $538.50 $126.81 $92188.05
77. $665.31 $537.76 $127.55 $92060.50
78. $665.31 $537.02 $128.29 $91932.21
79. $665.31 $536.27 $129.04 $91803.18
80. $665.31 $535.52 $129.79 $91673.38
81. $665.31 $534.76 $130.55 $91542.84
82. $665.31 $543.00 $131.31 $91411.53
9
Payment Payment Interest Principal Balance
Number Amount Amount Reduction Due
83. $665.31 $533.23 $132.08 $91279.45
84. $665.31 $532.46 $132.85 $91146.60
85. $665.31 $531.69 $133.62 $91012.98
86. $665.31 $530.91 $134.40 $90878.58
87. $665.31 $530.12 $135.18 $90743.40
88. $665.31 $529.34 $135.97 $90607.42
89. $665.31 $528.54 $136.77 $90470.65
90. $665.31 $527.74 $137.56 $90333.09
91. $665.31 $526.94 $138.37 $90194.72
92. $665.31 $526.13 $139.17 $90055.55
93. $665.31 $525.32 $139.98 $89915.56
94. $665.31 $524.51 $140.80 $89774.76
95. $665.31 $523.69 $141.62 $89633.14
96. $665.31 $522.86 $142.45 $89490.69
97. $665.31 $522.03 $143.28 $89347.41
98. $665.31 $521.19 $144.12 $89203.29
99. $665.31 $520.35 $144.96 $89058.33
100. $665.31 $519.51 $145.80 $88912.53
101. $665.31 $518.66 $146.65 $88765.88
102. $665.31 $517.80 $147.51 $88618.37
103. $665.31 $516.94 $148.37 $88479.00
104. $665.31 $516.07 $149.23 $88320.76
105. $665.31 $515.20 $150.10 $88170.66
106. $665.31 $514.33 $150.98 $88019.67
107. $665.31 $513.45 $151.86 $87867.81
108. $665.31 $512.56 $152.75 $87715.07
109. $665.31 $511.67 $153.64 $87561.43
110. $665.31 $510.77 $154.53 $87406.89
111. $665.31 $509.87 $155.44 $87251.45
112. $665.31 $508.97 $156.34 $87095.11
113. $665.31 $508.05 $157.25 $86937.86 10 years gone now
114. $665.31 $507.14 $158.17 $86779.68 yet 75% still goes to
115. $665.31 $506.21 $159.09 $86620.59 interest.
116. $665.31 $505.29 $160.02 $86460.57
117. $665.31 $504.35 $160.96 $86299.61
118. $665.31 $503.41 $161.89 $86137.71
119. $665.31 $502.47 $162.84 $85974.87
120. $665.31 $501.52 $163.79 $85811.08
121. $665.31 $500.56 $164.74 $85646.34
122. $665.31 $499.60 $165.71 $85480.63
123. $665.31 $498.64 $166.67 $85313.96
124. $665.31 $497.66 $167.64 $85146.31
125. $665.31 $496.69 $168.62 $84977.69
126. $665.31 $495.70 $169.61 $84808.08

How to Own Your Paycheck Again, by Leo J. Quinn, Jr. 10
Copyright 2008. All Rights Reserved.