Category Archives: Building Wealth

How to Make Money and Achieve Financial Freedom

In any wealth building and investing endeavor, you’ll need money. It can be your own money or other people’s money. But you need to start with some money.

There are 2 types of income

Active or earned or W2 income - requires your time and attention to actively participate in income-earning activities, such as having a job, driving uber, selling things on eBay or Craigslist.

Passive or leveraged income - still requires your time and attention in the beginning. But once a system is set up in place. It generates income on auto-pilot. Income comes in the form of rental income, capital gain, dividends, interests, commission, royalty, lease rent, profit, revenue, etc.

There are mainly 3 ways to make money

Best ways to make money

Trading time for money. 94% of people use this method. They are employees and self-employed. Sorry, if you’re self-employed, you’ll still an employee because you’re doing all the work. The only difference is you’re the boss too. So you actually have 2 jobs. How many hours do you have in a day? We all have 24 hours in a day, why some people make minimum wage, and others make millionaire while sleeping and having fun. Employees make earned income or W2 income. These income are taxed at highest tax rate because of social taxes.

Trading money for money. Only 3% of the population can make a good living investing their money to create more money. Investing requires special knowledge and experience. Many people say they invest in stock market or real estate by timing the market. Well, guess what? Most of these people are just “speculating” because they’re just hoping that their money will appreciate. If you know how money works, any time is a good time to buy or invest. “Timing the market” is not an investment strategy. It’s speculation. People who trade money for more money earns portfolio income, which is still a type of passive income.

Leveraging other people’s money and other people’s time. This is 1% of population. And these are mostly business owners and business investors. They invest in a “business system that generates money on auto-pilot”. Most of us are familiar with these business system, because most of us at one time or another work for a company that you never meet the owner.

So which is the best way to make money?

Let’s see what the wealthy people do, or the millionaires.

75% of millionaires are business owners and investors.

25% are professionals, such as doctors, lawyers and accountants.

What do millionaires do differently?

The wealthy invest in profitable businesses, and that’s how they accumulate their millionaires. Poor people buy stuff and the middle class buys liabilities.

Financial Needs of Retirees

Golden Egg of Retirement

Most of us work hard most of our lives in hope that when the magical moment, aka retirement, comes, we’ll have no responsibilities, debt-free, all children are on their own, mortgage all paid for, life insurance and estate planning all set. The only thing missing is destination and itinerary.

We all spend a lot of time dreaming about retirement, when all we do is sit at beaches all over the world chilling with a glass of wine in our hands.

My retirement dream is to play tennis, play golf, hang out with friends for lunch and dinner, travel around the world (for free), continue to help families with their financial needs and building wealth (because that’s something I enjoy doing).

Ok…hold on a second. Where’s all the money coming from?

That’s right, we all love to dream big, then reality sets in. How do we fund our retirement?

Well, my full-time job does have retirement plan for employees. Remember, it’s not your employer’s duty to make sure you have enough to retire.

You need to start planning…

Income may not be as important as what your expenses will be in retirement when determining the size of your retirement nest egg.

Most retirees can live on far less than they make once they have independent children and a paid-off home.

Unfortunately, your level of financial independence also determines your ability to maintain independence in other areas of your life, such as maintaining dignity during any long-term or chronic illness.

That’s right, we keep thinking about all to fun things to do about in retirement, we forgot we’re also older and eventually may need long term care.

How much do I need to retire comfortably without compromising my current lifestyle?

Some financial advisors would suggest a specific dollar amounts, but that’s arbitrary. And percentages of income do not matter much at all either since many people's incomes fluctuate dramatically over time.

The only thing that really matters is your expected expenses in retirement. I would suggest aiming for enough savings to cover 25 years of expenses in retirement. That's a reasonable assumption for people nearing retirement age now. An average man who is 65 is expected to live until 84, according to the Social Security Administration. And an average 65-year-old woman is expected to live to 87.

1. Have personal and financial goals for your retirement

There’s nothing more important than knowing where you’re going. Knowing what you want to do during your retirement will help you determine how much money you’ll need, and how long you’ll need.

If you plan to move to live in Philippines for the rest of your life during retirement, your retirement income need would be a lot lower than if you stay in Honolulu, Hawaii.

If you plan to stay in Honolulu, Hawaii and travel the world, you will probably need a fortune to completely retire.

2. Project your retirement expenses

Now that you’ve some ideas and goals of what you want to do during retirement, you can start with figuring out how much money you’ll need in expenses.

Your annual income during retirement should be enough (or more than enough) to meet your retirement expenses. That's why estimating those expenses is a big piece of the retirement planning puzzle.

To help you get started, here are some common retirement expenses:

• Housing: Rent or mortgage payments, property taxes, homeowners insurance, property upkeep and repairs
• Utilities: Gas, electric, water, telephone, cable TV
• Transportation: Car payments, auto insurance, gas, maintenance and repairs, public transportation
• Food and clothing
• Insurance: Medical, dental, life, disability, long-term care
• Health-care costs not covered by insurance: Deductibles, co-payments, prescription drugs
• Taxes: Federal and state income tax, capital gains tax
Debts: Personal loans, business loans, credit card payments
• Education: Children's or grandchildren's college expenses
• Gifts: Charitable and personal
• Savings and investments: Contributions to IRAs, annuities, and other investment accounts
• Recreation: Travel, dining out, hobbies, leisure activities
• Care for yourself, your parents, or others: Costs for a nursing home, home health aide, or other type of assisted living
• Miscellaneous: Personal grooming, pets, club memberships

RELATED ARTICLE: Pay Off Your Mortgage in 7 Years

Don't forget that the cost of living will go up over time. The average rate of inflation over the past 20 years has been approximately 3 percent per year. And your retirement expenses may change from year to year.


To protect against these variables, build a comfortable cushion into your estimates (it's always best to be conservative).

3. Decide when you'll retire

The earlier you retire the more years of retirement you have to fund. And the longer you live, the more years of retirement you have to fund too.

To determine your total retirement needs, you have to determine how long you'll be retired.

The length of your retirement will depend partly on when you plan to retire. This important decision typically revolves around your personal goals and financial situation. For example, you may see yourself retiring at 50 to get the most out of your retirement.

4. Identify your sources of retirement income

Now that you know how long you and your spouse want to continue working, then determine who you will be responsible for in retirement, all your sources of income (including Social Security).

Once you have an idea of your retirement income needs, your next step is to assess how prepared you are to meet those needs. In other words, what sources of retirement income will be available to you?

Retirees today face two main challenges: not saving enough for retirement and fear of outliving their retirement savings.

RELATED ARTICLE: Retire Rich Tax-Free on Your Own Term

Protecting your assets

Additional sources of retirement income may include a 401(k) or employer-sponsored retirement plan, IRAs, annuities, and permanent life insurance. The amount of income you receive from those sources will depend on the amount you invest, the rate of investment return, and tax treatment. If you plan to work during retirement, your job earnings will be another source of income.

The older we get, the more likely it becomes that we will need healthcare. For retirees, the concern is whether they will be able to pay for good quality healthcare when they need it. After working for a lifetime, retirees want to know that their golden years will be just that - golden, and spending some of those years in a sub-par nursing home is sure to make the experience much more difficult to enjoy.

5. Invest in long term care insurance

Medical expenses and private nursing home care can quickly wipe out a lifetime of savings. A retiree's ability to pay for the cost of in-home healthcare, adult day-care and nursing home expenses may determine the quality (or lack thereof) of healthcare the retiree can receive.

Retirees should look into purchasing a long term care insurance. LTC insurance not only cover expenses during long-term illnesses, it also protects you from having to spend down all your assets to qualify for Medicaid.

Some long term care insurance allow you to choose where to receive the care - a nursing home, an adult day-care center or at home.

6. Sign up for Medicare

Eligible retires should sign up for Medicare, which can be used to cover most medical expenses. Medicare provides two types of insurance - hospital insurance for in-patient care and certain follow-up care, and medical insurance coverage for physician services that are not covered under the hospital insurance.

The hospital insurance portion of Medicare is available at no additional cost, as it is paid for as part of an individual's Social Security taxes during employment. The medical portion of the insurance is available at a premium and is optional.

Medicare can cover medical expenses that you would have to pay with your own savings.

7. Leave on a good note

Have all your funeral and final expenses taken care off by a final expense insurance. The Everest final expense insurance provides planning tools and a 24/7 concierge service that takes care of everything for your family in the time of stress.

So instead of spending time looking for funeral homes and purchasing plans, your family can focus on what’s more important - the ones left behind.

Now you should have most of your financial needs taken care of for retirement. With good planning, your income sources will be more than enough to fund even a lengthy retirement, including any unexpected expenses.

What if it looks like you'll come up short? Don't worry.

You can always work part-time or start a new business to supplement your retirement income. Many retirees choose to continue working part-time during their “semi-retirement” years doing things they love. Some retirees do so for personal-fulfillment reasons, others may do it for the extra income it provides.

Starting a small business is a great way to supplement retirement income because you’ll also receive tax benefits that are reserved for business owners, further helping you to save on retirement expenses.

Whatever the reason you have, it’s great to know that you’re working because you CHOOSE to, and not because you HAVE to.

Why an Indexed Annuity Should Be Part of Your Retirement Plan?

There are two major challenges most retirees face today - lack of retirement savings or income and outliving your retirement savings.

Sources of Retirement

We frequently talk about the 3 traditional retirement income - pension, social security and personal savings.

3-Legged Stool of Retirement

Are Pensions Disappearing? Do You Have a Pension Plan?

In the 2013 Bureau of Labor Statistics reports, only 10% of private industry establishments offer defined benefit pension plans.

If you still have a pension plan, good for you.

Will Social Security Be Enough?

When Social Security first started in August 1935, there were 42 people working for every one retiree. Currently there is less than 3 people working for one.

Besides, people are also living much longer compared to 70 years ago.

Social Security is the largest source of income for most elderly Americans today. Unfortunately, it was never intended to be your only source of income when you retire.

With 2 of the 3 legs on the stool crumbling away, there has been a shift to personal responsibility.

Sources of Retirement Income

Did you know financial support from families is one of top 3 sources of retirement income? And most retirees were financially more worst off than before retirement?

Since you can’t rely on your company’s pension or social security, do you want to rely on your children, grandchildren, for your retirement?

They have their own share of financial responsibilities.

Are you saving enough for retirement?

Are We Saving Enough?

Most people would prefer to continue their preretirement lifestyle. Others choose to down size with hope that that will make their retirement income last longer.

How can an Indexed Annuity help solve your retirement dilemma?

An annuity (or income insurance) can provide you with income for life that you can’t outlive.

There are mainly two types of annuity - single premium immediate annuity and deferred annuity.

A single premium immediate annuity are most beneficial for someone who just retired and can roll over a lump sum of money from their companies’ 401(k) or Thrift Savings Account, or an individual retirement account (IRA).

The pay out starts one month after roll-over.

On the other hand, any individual can start contributing to a deferred annuity, that function similarly to an IRA. The money stays in the account and grow tax-deferred until a pre-defined time, usually at least 59 1/2.

When pay out starts, you get a monthly income for the rest of your life.

Another benefit of an indexed annuity is safety. Because your money in the annuity is not exposed to the stock market, your money is safe to grow tax-free.

With an indexed annuity, the insurance company assumes the risk of the market. While with variable annuity, you (the consumer) assumes the risk of the market.

If you, the contract owner, passes before payout starts, your benefit will payout to your beneficiaries as death benefit, just like life insurance.

Overall, an indexed annuity provides you with the security knowing that your money grows safely, you can a supplemental stream of cash flow that you cannot outlive.

Watch Tony Robbins talks about fixed indexed annuity.

Contact us to see how an indexed annuity fits into your retirement plan.

Financial Strategies Workshops – REGISTER HERE…

Are you tired of living paycheck to paycheck? Are you worry you're not saving enough for emergency, for retirement or for college? Do you want to learn better ways to make money? We might have just the solution you're looking for at Perfect Homes Honolulu.

Wealth is within reach…you just have to need to know how.

The reason why many people live paycheck-to-paycheck is the lack of financial education. Have you noticed that you're now making more money than you were 10 years, but you'll still struggle every month with nothing left to save or invest?

Financial literacy and building a financial foundation is the first step toward financial freedom...

Attend one of our FREE workshops to learn how money works, increase your cash flow so you can start investing in your future. Stop being a slave to money and make money your slave instead.

Free Download “Saving Your Future”

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Learn how to money works, build wealth, and protect your income and assets.

There is no magic for building a solid financial foundation.

You can make more money. The old way of thinking—getting a good job, working until 65 and retiring happily—is over. Nowadays you should be more proactive in your thinking about making money.

If you look for it, you’ll find it.

Make it a mission to change your family’s financial future.

1. Increase your cash flow. Make more money when you can, while you can. Have multiple sources of income.
2. Spend less. Cut down your expenses. It’s not how much you earn that counts. It’s what you keep. Set aside 5, 10, 15% of your income to savings.
3. Reduce your debt and liabilities. Interest on the debt will interfere with your goal for long-term asset accumulation.
4. Understand how money works. You must take time to understand how money works. You must learn how to make money work for you.
5. Have a financial goal. Set up a plan of action.
6. Take care of your responsibility. Have proper protection.

This book is the first step to your financial freedom...

How to Make Money Work for You

Understanding how money work is the first step to building wealth.

Remember, money is a tool. When used properly, money can build you great wealth. But, when used in the wrong way, you can be digging your own grave.

Consider this your user guide to money.

Wealth Formula

The Power of Time

Time can be your worst enemy or your greatest ally. No matter where you are in life or in building a financial strategy, the key is to begin saving now. The sooner you begin, the less money you need to set aside to create a solid financial future.

Pay Yourself First & Save Early

Mr. Save Early saves $3,600 per year for 7 years in an 8% tax deferred account.

Mr. Wait Longer starts saving the same $3,600 per year for 17 years in an 8% tax deferred account, 7 years later than Mr. Start Early.

Procrastination is one of the main causes of failure.

Pay yourself first each month, so you have money to invest and take advantage of the time and compound interest.

Don’t wait until you pay off all your debts to invest. That’ll be too late.

The Wealth Formula only works with early investing, high rate of return, and minimizing tax.

Make small changes in your lifestyle and spending habits to save at least $10 a day.

Related article: Turn Your Cash Flow from Negative to Positive

The Rule of 72 is an estimation of how long it would take for any amount of money to double.

You simply divide the number 72 by the rate of return, and the result is the approximate number of year for your money to double.

Take a look at the following hypothetical example that shows how an initial $10,000 investment grows over time.

How Fast Can Your Money Double?

Notice how a $10,000 investment at age 29 doubles faster as the rate of return increases. Your $10,000 compounded to a grand $640,000 at age 65 with a 12% return versus a merger $40,000 at 4% return.

That’s the magic of compound interest - money keeps making money, which continues to make more money, and saving early.

The Magic of Compound Interest

That’s exciting…but consider the interest rate on your credit card.

Is it 18%? Or higher?

The Rule of 72 can work against you just as powerfully as it can work for you.

The Rule of 72 does not consider impact of taxes. Taxes can increase the amount of time it takes for money to double.

Money or wealth needs time and compound interest to grow.


How Fast Can You Recover From a Loss?

Stock market fluctuation can greatly influence how fast and how much your money can grow. Any loss will take an even great rate of return to recover. Therefore, you want o avoid risk of loss as much as possible.

Don’t underestimate even a small loss of 5%. It’ll take 10% to recover back to your previous position. A 20% loss will take a hefty 40% return to recover.

So proceed with caution when investing in stock market, if that’s your choice of investment.

Related article: Invest in Real Estate

Impact of Tax and Inflation

In addition to procrastination, tax and inflation are also enemies when trying to build and maintain savings.

Tax and inflation is like the infection that eats at your money tree. However, you cannot avoid tax and inflation completely.

But you can increase your odds to minimize their damage.

Related article: How to Become Rich and Build Wealth

Protect Your Family with Permanent Life Insurance

Are you worry that your family will not be able to support themselves financially and lose their home if something happens to you (the breadwinner)? Are you worry you’re not saving enough for emergency, retirement or even college education? We might have just the solution you’re looking for at Perfect Homes Honolulu.

Protecting your family’s income and asset is a cornerstone to a sound and solid plan for
financial freedom.

Death of Primary Income Earner

When your income stop due to a serious illness or injury or death, who will pay the mortgage, final expenses, debts, taxes, car payments, college tuition and other expenses? 

What if I tell you, there is a financial solution that can protect your family income and your assets in the event of serious illness, disability or death. A solution that can also provide a source of funding for emergency, college tuition, and supplement your retirement income.

There is life insurance. And there is cash value life insurance.

Most people know life insurance as just “life insurance”. Most people perception of life insurance is base on their idea of “car insurance”. It’s useless unless when something bad happens to your car. Otherwise, it’s a waste of money.

That’s TERM LIFE INSURANCE that most people are familiar with. The one just like “car insurance” - useless unless when something bad happens to your car. Otherwise, it’s a waste of money.

The life insurance that I’m talking about is completely different. I’m talking about PERMANENT LIFE INSURANCE, which covers you for life.

Why Buy Life Insurance

The permanent life insurance has a build-in saving account which can be used to:

Replace income for your dependents
Pay off your mortgage
Pay for final expenses
Pay federal and state estate taxes
Create an inheritance for your heirs
Pay for your children’s education
Create another source of savings
Pay for medical expenses in chronic and terminal illnesses
Pay for long-term care
Provide another source of retirement income
Provide fundings for your favorite charity

Cash value life insurance, as in its name, is life insurance with cash value. Similar to a savings account associated with your life insurance. The difference is that this "savings account" grows tax-deferred as part of the life insurance.

You can also borrow money against your cash value. Instead of taking money out of your cash value, you'll be taking out a loan, using the cash value account as a collateral for your loan.

This is an added bonus, because your cash continues to grow tax-deferred while you're enjoying your extra cash tax-free.

Another bonus with borrowing from a cash value life insurance is that you don't have to repay your loan if you don't want to.

How? Good questions!

Remember it is a life insurance policy. So it also has a face value. When you die, the insurance will pay off your loan with your policy's face value.

Isn't this a great idea? People always think that life insurance only benefit the family after you diet, but with a cash value life insurance, you can use the living benefit if you need it.

The Indexed Universal Life (IUL) insurance policy is an option that allows you to accumulate cash in a tax-deferred manner. This particular financial product has grown in popularity mostly because it comes with protection against loss in a down market.

The key features of an indexed universal life insurance include:

Tax-free death benefit
Tax-deferred growth
Tax-advantaged loans
Protection against loss in a down market

Got Money for Emergency Fund?

Are you living paycheck-to-paycheck with nothing left at the end of the month to spare or save?

Are you worry that if something comes up and you don’t have the cash for it?

No matter how much you plan in life, the unexpected happens.

This is specially important and true for people living in Hawaii, which is an island. That means, we have to FLY to get to another state.

It's very sad how many times I've seen colleagues who encounter family emergencies and have no money to purchase their plane tickets to fly back to their families on the mainland.

For me, that ticket costs even more because my home is in Macau. The last time I had to purchase 2 plane tickets to Macau on the same day flight for emergency cost US$3,000. That's was 2008.

Do you have the money now if there's an emergency that you need to attend to? Major car repairs, major homes repairs, serious illness or hospitalization, loss of employment, extended elder care or long term care?

Don't Think You Need Emergency Fund?

How much do you need for your emergency fund?

To prepare for life’s little “disasters,” set up an emergency fund to help pay for any resulting expenses. To determine how much you should have in your emergency fund, consider setting aside three to six months of your total expenses.

Generally, we would like to have a comfy cushy emergency fund of 6 months expenses.

Say you usually monthly expenses for all your basics – mortgage, food, grocery, health care, etc. This comes out to $5,000 per month. A comfortable emergency fund would be $30,000.

Now you must be asking, “how and where am I supposed to get that kind of money to put aside?”

First of all, you should be practicing the “Pay Yourself First Strategy”.

Second, I hope you have good credit score.

Now let’s talk about how to create an emergency fund with NO FUNDS of your own.

1. You’re going to use a “line of credit” as your emergency fund

Line of credit is very similar to a credit card. You open a credit card, which gives you a revolving credit line, which you can spend and pay off any time you want.

A line of credit does exactly that. Interest rates on line of credit are generally a lot lower than credit cards’. Therefore, it is a better option.

There are generally two types of line of credit: personal and home equity. We’re not going to talk about business line of credit.

I usually tell my clients to get a line of credit to use as their emergency fund.

If they own a home and have enough equity, I would recommend getting a home equity line of credit.

If they don’t own any homes, they can still get a personal line of credit.

Because line of credit is just like a credit card, even if you get a $5,000 line, you can use it to build up your credit score, which would later allow you to qualify for larger line.

With a line of credit, the money is always there available for you whenever you need just like a credit card. In fact, they do come with checks and credit card.

I always remind my clients that whatever they take out from the line, they have to repay it. Not that because the interest is high. It’s just that the money is for emergency only.

2. Your life insurance can be a source of emergency fund

With most permanent life insurance policy, the cash accumulation is accessible to the policy owner during his/her lifetime. This provide a good source of emergency fund.

Usually money is taken out as a loan against the cash value, so the withdraw does not trigger any tax event.

While it is a loan, meaning it required re-payment. The unique benefit of having a permanent life insurance is that policy loan does not necessarily need to be paid back this lifetime. When the insured died, the death benefit minus any outstanding loans, is paid out to the family.

Therefore, you don't want to be too aggressive and spend every dime in your cash value and let your policy lapses.

Pay Off Your Bad Debts with the Best Debt Consolidation Strategies

Pay off Your Bad Debt with the Best Debt Consolidation Strategy

Do you have student loans? Car loans? Mortgages? Credit card debts? Are you having trouble paying off your debts? Are you stressed out by all the debts you have?

33% or 77 millions of American don’t pay their bills on time and 39% carry credit card debt from month to month.

We live in the wealthiest country in the world, but we always have money problems.

Having debts in your life is not fun. It’s fun at the moment when you make your purchase. It’s human nature to purchase for emotional reason, then try to justify our purchase with logic later.

Debt is like a tumor. If you don’t do anything to stop it and continue to feed it with more spending, it grows rapidly. Even if you leave it a lot, it continues to grow.

The magic of compound interest that works wonders for us growing our money also works wonders for the banks and lenders, when it’s their money, and we’re paying for it.

Debt becomes a way of life. Consumer debts is one of the biggest obstacles to achieving financial freedom and retiring rich.

It’s important to have a strategy to get rid of all your debts in life and start building a solid financial foundation.

Here’s the best debt consolidation strategy:

“What do you do when you find yourself in a hole? Stop digging!”

The very first thing to do is to set your mind to be debt-free, and stopping spending. Write “Want or Need?” in a piece of paper and put that piece of paper in your wallet. Every time you’re about to spend money, ask yourself if this is a need or want.

Buy only what you need.

2. Consolidate your credit card and consumer debts with a low interest line of credit

Revolving high-interest credit card debt is one of the worst types of debt because it can quickly grow into an unhealthy financial situation. Let’s look at an example of the true cost of using a credit card.

Credit card minimal payment

In the above scenario, you end up paying $6,173 in interest, which is $1,623.29 more than the original credit card balance. However, if you commit to paying slightly more each month, you can pay off the card’s balance in half the time and pay much less, only $2,574, in interest.

Paying Extra Each Month

These examples show why it’s important to strive to pay off credit card and high-interest loan debt sooner rather than later.

• Itemize all your outstanding credit card debt or loans from the highest to the lowest interest rate, and list the monthly payments for each.

• Pay more than the minimum – as much as possible within your budget
– on the credit card/loan with the highest interest rate. Once you pay off that credit card/loan, begin paying off the next highest interest rate credit card/loan.

• Consider transferring credit card/loan balances to a card with a low interest rate that is offering a promotional, no fee transfer option. Or, for an account that is charging more than 14 percent interest, call the credit issuer to ask for a lower rate, such as 11 percent.

There are many companies out there that offer debt consolidation loan. However, many of them still charge high interest.

A better option is a line of credit from your local banks or credit unions. Credit unions usually have more competitive rates and easier qualification requirements than bigger national banks.

If you qualify for a personal line of credit, you can use this line of credit, which acts like a credit card, to pay off your high interest-rate debt faster.

If you are a homeowner, you can also consider taking out a low-interest home equity line of credit to pay off your debt. Although the home equity line of credit is still debt, the interest accrued is usually tax-deductible. As always, check with your CPA to be sure.

Plus, you'll always have an emergency fund available.

A line of credit allows you to take out only what you need. You don’t have to take the full line of credit out like a loan.

Another benefit of a line of credit over conventional loan is the interest accumulation. In a conventional LOAN, such as mortgage, car loan, personal loans, interest is calculated by amortization. Your payment is the same every month for the duration of the loan, but you’ll be paying more interest in the beginning, which means you’ll pay off your loan slowly.

On the other hand, interest on any line of credit is calculated as simple interest, which means you only pay interest on just the portion of the loan that you borrow. And interest is calculated on a daily basis. So if you use your line of credit like your checking account - putting your income into the line to bring down the balance, you'll pay less interest. Because it is a line, you have to flexibility to use the credit each month, as long as responsibility is exercised.

A friend of mine paid off $8,000 debt in just one month with his $12,000 personal line of credit. He uses the money from the line of credit to pay off his outstanding personal loan, which is the $9,000. Then he just keep attacking his line of credit balance with his cash flow.

When he is putting his monthly income into the personal line of credit, that deposit is considered his payment, which is obviously greater that the minimal payment. So that helps to improve his credit score.

3. Pay off your mortgage in 7 years with a home equity line of credit.

If you have a mortgage, try to pay it off as quickly as you can by paying additional principal each month. Don’t refinance, even if the rate is better.

When you refinance, you’ll repeat all the escrow, appraisal and closing costs. Besides, refinancing means you re-start your 30-year all over again, which means you’ll be paying mostly interest, which does not help you pay off your mortgage.

4. Make more money by starting a side gig or business

Now we have a few strategies in place, we need to look into making more money to help speed up your debt elimination process.

Think about it. You got into this position in the very beginning because you’re spending money that you don’t have. So it makes sense to find ways to make up this money and get yourself out of debt.

Being an uber driver is one of the easiest way to make money right away. You just need to have a functional 4-door car with all legal license, insurance and inspection, etc. Download the apps, register and you’re good to go. You get paid once a week. You can easily get $20 an hour taking people to their destinations and meeting new people.

You can also join the cause in revolutionizing the financial industry. You’ll earn while you learn financial concepts and help families like yours become financially independent. Pay is handsome.

Debt consolidation does not need to be complicated. It requires discipline and determination. Retire your credit cards and focus on making money.

Related article: How to Make Money Work for You

Zero Down USDA Home Loan

For home buyers today, there are two mortgage programs that offer 100% financing.

The first is the VA loan from the Department of Veterans Affairs. It's available mostly to active duty military personnel and veterans nationwide.

The other is the U.S. Department of Agriculture's Rural Development Single Family Housing Loan Guarantee Program. The USDA home loan is sometimes called a "Rural Housing Loan" or a "Section 502" loan.

Similar to FHA loan, USDA does not generate the loan. It insures mortgage lenders against loss 100%. The program is meant to drive homeownership in rural and underdeveloped areas.

The USDA Home Loan program in Hawaii offers very low interest and mortgage rate than any other institution. USDA home loans in Hawaii also offers the options for renovation, repairing, building a home from scratch and even paying off old debts.

The USDA does change its "rural areas" fairly regularly and an expanding town is apt to lose its rural loan eligibility with the next census. Homes which are USDA-eligible today may not be USDA-eligible next year.

Benefits of a USDA Home Loan

USDA home loans are very similar to conventional loans backed by Fannie Mae and Freddie Mac.

Unlike conventional loans, USDA home loans have no down payment requirement, which allows a home buyer to finance up to 100 percent of its purchase price. The U.S. Department of Agriculture assesses a two percent mortgage insurance fee to all loans, and the cost may to be added to the loan size at the time of closing, as can the costs of eligible home repairs and improvements.

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You can't do that with a Fannie Mae or Freddie Mac loan.

Another benefit is that its annual mortgage insurance fee is just 0.40%, which is less than half of most private mortgage insurance charged on a comparable conventional loan, and only one-fourth of what the FHA will charge.

USDA home loans do not have loan size limitation, which means home buyers can theoretically borrow more money with a USDA mortgage than with a conventional, VA or FHA loan.

Loans insured by the U.S. Department of Agriculture are available as 30-year fixed rate mortgages only, and come with their own USDA Streamline Refinance program.

Qualifying for USDA Home Loans in Hawaii

The factors that will determine your USDA eligibility are current income, credit history and also the zip code of the country where the home is situated. USDA loans are specifically for moderate to low income households thus; there is an income limit for each USDA home loan eligible county.

To be eligible for USDA Home Loans in Hawaii, your yearly income should be less than 115% of the average median income for that area. You will qualify for a USDA Loan if your income is quite less than the average median income.

Check here to see if you meet the USDA Loans Income Requirements

You should have an average credit score of at least 640, maintain a steady flow of income, and should have no foreclosures that are unsettled and no bankruptcies in the past 3 years.

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Other qualifying criteria:

• The subject property must be a primary residence
• The buyer must meet a qualifying ratio of 29 percent for housing costs; and 41 percent for total debt
• The buyer may not own another home within commuting distance of the subject property

Most importantly, the property must be located in one of the USDA designated areas. USDA property eligibility is determined by census tract density. USDA designated rural area usually has a population of less than 20,000 residents. Because of the way the USDA defines "rural", there are plenty of ex-urban and suburban neighborhoods nationwide in which USDA loans can be used.

USDA-designated areas in Hawaii:

Big Island – all areas except Hilo

Kauai, Lanai, Molokai – all areas

Maui – all areas except Kahului and Wailuku

Oahu – Village Park and Royal Kunia subdivisions, Ewa Beach, Makakilo, Kapolei, entire Waianae Coast, Central Oahu from Whitmore Village North to North Shore and Kunia, entire North Shore, Windward Oahu from Kahuku South to Ahuimanu, Waimanalo from Olomano Golf Course to Sea Life Park.

If you fulfill all these criteria, you should be eligible for a USDA Loan in Hawaii.