Why We Are Expected To Be Lazy
Something occurred to me the other day. We (the American consumer) are totally expected to be lazy and undisciplined. I mean, really, there are even business models built on that expectation and fact.
Have you ever seen financing deals directed at consumers and/or homeowners that sport advertising tag lines like “12 months, same as cash financing?” I have bought many items with this kind of financing and never paid a penny in interest. These items range from smaller items like my iPod ($500 with three months, same as cash financing) to larger items like my new air conditioning system ($8,000 with 12 months, same as cash financing.)
When I first saw a deal like this, I assumed is was either a joke or there was some other diabolical catch. After all, how would these financiers make money?? Later, I read something somewhere that about 75% of people never end up paying off the balance of the loan on time. That’s when the light bulb went on.
Along those same lines, I’m always looking to find ways to make a habit of putting myself in a financially better position. One of my plans was to do the “pay an extra mortgage payment once a year” deal on the rental properties thereby shortening the mortgage term and reducing the interest paid. The mortgage companies all have programs which allow you to do this except they charge you for doing it! And why? Because the general public doesn’t have the discipline to do it on their own.
On most of our rentals one principal and interest portion of the payment amounts to no more than $600 per month. It amazes me that 75% of the general public can’t scrape together $600 over the course of a whole year in order to save tens of thousands of dollars over 20 years.
