- Budgeting
- Cash Management
- Consumer and Mortgage Loans
- Introduction
- Understand How Consumer Loans Can Keep You from Achieving Your Goals
- Explain the Characteristics and Costs of Consumer Loans
- Explain the Characteristics and Costs of Mortgage Loans
- Understand How to Select the Least Expensive Sources for Consumer Loans and How to Reduce the Costs of Borrowing
- Summary
- Assignments
- Debt and Debt Reduction
- Time Value of Money 1: Present and Future Value
- Time Value of Money 2: Inflation, Real Returns, Annuities, and Amortized Loans
- Insurance 1: Basics
- Insurance 2: Life Insurance
- Insurance 3: Health, Long-term Care, and Disability Insurance
- Insurance 4: Auto, Homeowners, and Liability Insurance
- The Home Decision
- The Auto Decision
- Family 1: Money and Marriage
- Family 2: Teaching Children Financial Responsibility
- Family 3: Financing Children’s Education and Missions
- Investments A: Key Lessons of Investing
- Investments B: Key Lessons of Investing
Understand How to Select the Least Expensive Sources for Consumer Loans and How to Reduce the Costs of Borrowing
In order to calculate the cost of your consumer loan, you must understand the following key relationships:
- The total cost of the interest charged on your loan is directly related to the interest rate charged. The higher your interest rate, the more interest you will pay over the life of the loan. Keep your interest rate and fees as low as possible.
- The total cost of the interest charged on your loan is inversely related to how long you have had the loan. The longer you have the loan, the more interest you will pay over the life of the loan. Pay the loan off as quickly as you prudently can.
- The amount of each payment you must make is directly related to both your interest rate and how long you have the loan. The lower the interest rate and the longer the life of the loan, the lower your regular payments will be.
