Section 1: Using the BLOC to Manage Your Money

What We Have Learned

As demonstrated in the previous illustration, you paid off the car within 1 year. All further payments from your child is now excess income. You will be earning the interest instead of the bank.

Of course, this is a simple illustration. Factors may lesson the amount of discretionary income you may have from month-to-month.

What has been demonstrated is the power of the BLOC program.

You could use the BLOC to finance your child's education, put a down payment on a vacation home, renovate your existing home, start a family business, and finance other family needs.

Important Note:
Never Let Your BLOC Move Into Negative Territory

Your BLOC should not drop below a zero balance. This is money that you are giving away to the banks. So what should you do if your BLOC balance reaches zero:

• How about paying down your mortgage:

  Example:
  assume you closed on the following mortgage loan four years ago to the month:
  
  mortgage loan amount: $300,000
  term: 30 years
  APR: 6.00%
  
  you will then use your BLOC to make an additional payment of $5,000 on the 48th month of your mortgage repayment plan.

  Your BLOC will look like this:

Paying down your mortgage can save you money by lessening the amount of interest you pay on your mortgage loan.

Your savings will approximate to the following:

You will be trading $18K mortgage in interest by using your BLOC to advance $5K.

Download this spreadsheet to run your own numbers.

— FREE Download (MS Excel Worksheet)

If you have MS Excel - or other type program - use this amortization schedule to analyze your own payment and payoff numbers.