Hey Investors, what should I do?

Discussion in 'Professional Trading' started by MingWu, Apr 29, 2007.

  1. MingWu


    I have a loan outstanding of $28,000 at an interest rate of 8.5%. The payment on it starts soon. It is a private loan i took to complete my Business education in the US.

    I have enough to pay off the loan completely. Or should I invest in stocks or something else and get more returns and pay off the loan later?

    advise please :D
  2. Better to have tried and lost than to never had tried at all.
  3. Pay off the loan, then save another chunk to invest with. By paying off the loan, that's a guaranteed 8.5% gain, which you won't find anywhere else.

    While you're saving that money, take the time to learn all you can about investing so you'll be somewhat knowledgable when you jump in. Lots of good ways to invest, find one that suits you. Take advantage of 401ks and IRAs.

    BTW, this is a site for traders, not investors. Fatwallet.com is a good starting point for investor info, many others too.

    Good luck~
  4. inf000


    but we already know what you are going to do don't we

    you will be very sad later, but remember we've all been there :(
  5. MingWu


    I think I'll buy stocks. or put it in the HSBC savings account with 5.05 % returns and wait for a good investment. But I don't know, i think traderdon56 is right and I'll be better if I pay it all. But, it is sad to pay that much money all to them :mad: I want to make it into more.
  6. BJL


    Banks love people like you. Paying 8.5% and receiving 5%...
  7. gkishot


    But you took the loan for education not investing. If you finished your education it would be nice of you to pay off the loan.
  8. dtan1e


    get more loans, live like there's no tomorrow !!!:D :D :D
  9. New traders seem to lose their money within 1-2 years at about a 90% plus rate. So the real question is in 1-2 years from now do you want to:

    1) have paid it off and saved 8.5% interest?

    2) have traded it, and lost about 90% of it?

    I need to get something straight here. What do you mean by a private loan? Is this money that was lent to you by a family member or a friend? Or is this a personal loan from a bank?


    My god man, did you not learn anything in business school? Did you pass the finance and accounting courses? What about ethics or did you fail to take that?


    I don't know the terms of your agreement but if you borrowed $28,000 at 8.50% to be repaid in let's say equal monthly installments over 10 years do you realize that equates to a repayment of $63,368 over the life of the loan? You'll spend 5 1/2 years just paying the interest. Talk about debtor's prison.


    Ahhh.....$63,000 that's chump change. What makes you think you own that $28,000 you are sitting on? Someone leant you $28,000. On your personal balance sheet you posted that as a debit in your cash account while at the same time entered an offsetting credit entry in accounts payable. Assets plus liabilities equal owners equity. Assets (cash) + Liabilities (accounts payable) = Owners Equity. $28,000 + ($28,000) = $0. Pragmatically that $28,000 you have in retained earnings is not yours as long as you have an outstanding liability. Diversion of funds to activities other than what they are intended is known as extortion. Last I heard that is a punishable offense. I know, I know, we're getting into grey matter here. I am purposefully pushing the envelope in order to make you think.


    There are other issues at large here that are irreplaceable and they deal with character. Remember, it is your character that allowed you to secure the funds in the first place. Someone trusted you to live up to your obligation. You put your reputation on the line here my friend. Especially if this private loan is from someone close (hopefully not cousin Vinnie). There's nothing worse than having your reputation dragged through the mud amongst family and friends. Maybe that doesn't matter to you but trust is the hallmark to any friendship and it is not something to be squandered.


    I know your objective with your scheme is to gain wealth. However, above average attractive rates of return are "deceitful sirens that that sing but to lure the unwary upon the rocks of loss and remorse." George Clason. If you truly want to gain wealth maybe you should start with a simple classic wealth primer. Get your hands on a copy of "The Richest Man in Babylon" by George Clason. Read it from cover to cover and apply those time tested methods to attain your dreams.


    Relieve yourself of any obligation to be truly free. God forbid if a calamity were to befall you with this obligation hanging over your head. It could take years for you to make it right. While all the while you see those around you living comfortably and secure while you remain behind the eight ball. That's a bitter pill to swallow and not the way to live my friend. So apply what you have learned in business school to your personal life and live happily ever after.


    #10     Apr 30, 2007