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How To Get a 20% Return On Your Money

By Mark Riddix

The title to this post may make it sound like some get rich quick scheme, but trust me it is not. You can legitimately get a guaranteed 20% return on your money. The answer does not lie in any one investment product. There is no stock, bond, mutual fund, or savings product that will guarantee you this kind of payment. So, how can you get such a high return on your money?

Here’s how to get a double digit return on your money:

Eliminating credit card debt

Did you know that credit card companies can charge interest rates as high as 29.99%? These usurious rates mean that are you are losing a significant return on your money every month. By making it a priority to eliminate debt in order to avoid these high interest rates, you are actually gaining 20% plus on your money every month. You are paying yourself instead of paying out tons of money in interest over years. Most people do not realize that by avoiding a negative return on your money, you are actually creating a positive return on your money.

Paying your bills on time

We have covered the topic of late fees in the past. It’s always important to pay your bills on time. As you already know, it not only can help your credit rating but also can save you money. There is another benefit, however. Paying your bills on time will help you generate positive cash flow and avoid falling further into debt. For example, let’s say you pay your cell phone, cable, or utility bill late each month. Your cell phone or cable bill may only be $50 but if you’re not paying it off on time, you may be charged a late fee of $5 or more. Five dollars may not seem like much, but that would represent 10% of your monthly bill. That’s a pretty large percentage. Imagine how much money you are losing every year just by being a day or two late on a bill. Be organized, disciplined, and smart, and you’ll reap some major financial benefits.

Refinancing a high interest rate auto loan

Some of the worst auto loans in the world are signed at small side lots. People will pay exorbitant interest rates for the chance to own an automobile because they don’t know how to properly negotiate a car loan. These dealers will often start rates at 15% and upward for people looking to buy a car with a less than favorable credit rating. But you’re in luck. Just because you signed up for an auto loan with a high interest rate does not mean that you have to be stuck with this loan. You can always shop your loan around after 9 months of timely payments, especially with great sites like MoneyAisle. Credit unions are another great place to go for loan refinancing. With these various resources, you may be able to trim an auto loan of 22% down to the single digit stratosphere.

Always remember that the money that you save by avoiding negative financial decisions can have the same effect on your bank account as earning a high return on your money. Eliminating high interest rate debt is exactly the same as getting a remarkable return on a stock, bond, or mutual fund.

(Photo credit: AMagill)

Mark Riddix
Mark Riddix is the founder and president of an independent investment advisory firm that provides personalized investing and asset management consulting. Mark has written financial columns for Baltimore and Washington, D.C. area newspapers and is the author of the book, Your Financial Playbook.

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