Solutions 4 Financial Independence: 10/25/18
Question 1: “We are currently struggling paying our home equity loan. We have some saving bonds that are past their due date, what are your thoughts on cashing them in and using that money to pay down the home equity debt?”
John Halterman Answer: Well, first of all Sheila, you know what? I got to congratulate you because I think that paying off debt is a huge deal. Especially, when it’s open-ended credit debt, when you don’t have a fixed payment every month with an end to it. And I get it, we all get in situations where we can struggle at times. So, just the thought of paying off your debt is a wonderful thing.
Question 2: So, do you think it would be a good idea to cash those bonds in?
John Halterman Answer: Well, she said a couple key things. I mean, number one, her bonds are past her due date. So, she's not getting any more interest, and then the second thing is, bonds today are not paying a lot of money. So, assuming that she's not using those for retirement, a lot of times people either inherited bonds or bought them through their paychecks, but those aren't a high interest bearing thing. So, if you’re looking at open-ended credit, I do think it's smart, because getting rid of any debt is like growing money, just the opposite way. So, I think it's positive that you do that. So, Sheila, definitely, if you’re struggling, take the bonds, pay off the debt, it’s a great thing in the future.