Welcome to Sage Advice

Welcome to the first ever blog written by Sage Personal Finance!

We hope to compile some information each month that helps you become (or continue to be) a wise financial planner.  As a person who enjoys working with data and usually needs to be shown actual numbers to be convinced about anything, I thought I would compile a list of some helpful on-line calculators and describe how they might help you make sound financial decisions.

1)      To Buy or Lease a Car?  http://www.bankrate.com/calculators/auto/lease-buy-car.aspx.  Nearly everyone will have to make this decision at some point in their lives.  Often, it comes down to how long you plan on keeping the car that you buy/lease.  If you keep cars for 10+ years before moving on to a newer model, it may be cheaper to buy than to lease.  Also, your lease may or may not include maintenance costs—if it does, that could save you a lot of money if your car needs repairs down the road.  Sales tax rates also vary from state to state and may greatly affect the amount you could pay for a car out-the-door.

2)      How Long Will it Take to Pay Off My Credit Card(s)? http://cgi.money.cnn.com/tools/debtplanner/debtplanner.jsp  This is a sobering exercise!  The average person has a few thousand dollars in credit card debt.   If you enter in say $3000 in credit card debt, put in $300 as a minimum monthly payment, at 15% interest, it will take you 3 years and 4 months to pay off the bill, and you will wind up paying $367 in interest.

3)      How Large of a House Loan Can I Afford? http://realestate.yahoo.com/calculators/afford.html   Now is a pretty good time to consider buying a house, since housing prices and loan interest rates (30 year-fixed at around 3.9%) are low.  This calculator allows you to input your income and expenses and it will tell you the amount of monthly mortgage payment you can afford.  It suggests not carrying a mortgage over about 30% of your monthly income.

4)      How Long Will I Live? http://www.livingto100.com/calculator/age  If you want to plan for retirement, take this quiz to see how long you will be around.  If you don’t smoke, eat well, and have long-life genes, you might need to save more to ensure the funds are there for you well into your 90’s.