Pay Off Debt or Save Money | During the Crash

Should you be stockpiling cash right now, like Pablo or should you just pay off your debt?

1. The Answer is Both ( but the problem is the percentage)
– How much do you save vs how much do you pay off
– Well it depends a lot on what you plan to do with the money
– But I’m going to give you guys a general rule

Details:
– 10%: emergencies: but because of the PROBLEM, this should be 20%-30% right now until you hit 6 months.
– 20%-40% paying of Bad Debt: This includes credit cards and things that you bought but doesn’t need, and yes that might include that new fancy car.
– Cash: 10-20%: The reason you want cash has just incased an opportunity pops up or if something insane happens then you are secured.

And:
– I know numbers are missing here, but those numbers belong to investing, which I made a video about yesterday.
Link: https://www.youtube.com/watch?v=4mEFmGc3aNo

2. Debt vs Savings
– The basic idea is to do both
– But here is why

Just Savings/Stock Piling Cash:
– the return on your money right now is Negative
– Interest rates for savings are around .10% and inflation is still 2%
– Meaning that every year you’re losing money just by saving your money, around 1.90%

But: What about your Debt
– If you’re also carrying a balance on your debt
– You might be losing 16-30% every year because of credit card interest rate
– Which is even worst than losing 1.90% with savings

Solution:
– You have to do both but also do an extra step
– And this is where we get into investing

3. Debt vs Investing
– This is the best way to maintain a green on your money not just be in the red losing money
– And this is where the extra money is going to come into play
– It’s going to be used to make you more money

How to:
– StockPiling to Invest: holding means your losing around 1.90% every year, so if your planning to invest in the short term, then it’s worth parking your money

The Plan:
– Pay off Debt: that’s means 20-40%
– Stockpile cash for investing: 10-20%
– Emergency Fund: 10-20% also
– Current investments 10-20%

The Idea:
– To pay off the stuff hurting you the most
– While maintaining some side money to invest
– And also making sure you can survive for 6 months
– And also taking advantage of the current market.

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