Learn the millionaire mindset that will set you free of debt forever'

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• Learn the millionaire mindset that will set you
  free of debt forever.

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Building a secure financial future is not as easy
as it used to be.

• In 2002, consumer debt in the U.S. surpassed 1.6
  trillion. Credit cards account for almost half of
  that debt.1

• In 2001, the average household had 10 credit
  cards with an average combined balance of
  8,367. The average interest rate was 18.9.2
• If your credit card balance is 8,000 and you
  make the minimum monthly payment at 18 interest,
  it will take you 25 years, 7 months to pay off
  the debt.3

• Most people fail to realize the devastating
  impact this has on their financial future.
• Its no wonder personal bankruptcies are at an
  all-time high.3
• There has to be a better way.

1. Federal Reserve Board, Consumer Credit Report,
May 2002. 2. Sources USA Today, April 29, 2002,
cardweb.com. and neway.org, May 2002. 3. Source
neway.org, May 2002.
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The Rules Have Changed

• Fact
• Since you need to borrow money during the course
  of your lifetime...
• Doesnt it make sense to borrow the money as
  inexpensively as possible?
• You should avoid high-interest, non-deductible
  debt such as credit cards, auto loans and
  personal loans. Instead, choose the better way.
• Harness the Powerof Your Mortgage

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Harness the Powerof Your Mortgage

• The Old Way of Thinking
• First, get the lowest-rate mortgage...

• Then, start a bi-weekly mortgage program...
• And, send in additional money whenever possible
  to reduce the principal balance...
• ALL so you can pay off the mortgage as soon as
  possible.

This Depression Era mindset has been burned into
the American psyche. But, is it possible this
is exactly what you should NOT be doing?
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The New Rules of Money
You should get a big, 30-yearmortgage and
never pay it off.
Ric EdelmanNew York Times Best-Selling Author
of The New Rules Of Money

• The rules have changed. Now...
• Choose the best mortgage, not necessarily the
  one with the lowest rate.

• Stay away from bi-weekly mortgage plans.
• Never send extra money to your mortgage company.
• Paying off your loan is like putting money under
  your mattress.

Your goal is to make the smallest payment with
the biggest tax-break possible. That means never
paying off your mortgage. To understand why,
discover The Truth About Money.
1 Interest rates subject to change. The above
hypothetical examples are for illustrative
purposes only.
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The Truth About Money
Here are 5 great reasons to carry a big, long
mortgage and never pay it off.
Ric EdelmanAuthor of the acclaimed
Best-Seller, The Truth About Money, 1997 Book
of the Year
Reason 1 Mortgages dont lower home
values. Your house will grow in value (or not)
whether or not you have a mortgage. In fact, most
people discover that, over time, their mortgage
balance falls while their home value rises
creating substantial wealth they never expected.
Reason 2 Your mortgage is the cheapest money
youll ever buy. Most people need to borrow money
during their lives, so why pay 18 to credit
cards when you can borrow at rates of 8 or even
less? Reason 3 Your mortgage is the best way
you can lower your taxes. Interest you pay on
personal loans, auto loans and credit cards is
not tax-deductible, but for most of us, interest
you pay on mortgage loans is fully
tax-deductible, making the cheapest loan youll
ever get, even cheaper. Imagine borrowing money
for a net cost of just 5!1 You can do it with a
mortgage loan! Reason 4 Get the cash out of
the house while you still can. The main reason
people turn to borrowing is because they have
little or no income. But if you ever suffer a job
loss, major medical or other financial crisis,
you could find yourself unable to get a home
loan. Thats because lenders dont like to lend
money if you are already in financial difficulty.
Thats why you should get a big mortgage now,
before you need it and while you still
can. Reason 5 Your mortgage becomes even
cheaper over time. Depending on the loan you
choose, your payment never rises but your
income likely will. That means todays mortgage
payment becomes increasingly easy to pay over
time!
The rules of money have changed. And nowhere is
that more true than with mortgages.
1 Interest rates subject to change. The above
hypothetical examples are for illustrative
purposes only.
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A Tale of Two BrothersAdapted from the book,
The New Rules of Money

• Our story begins with two brothers, each earning
  70,000 a year. They each have 40,000 in
  savings and both are buying 200,000 homes.

• 15-year mortgage at 6.38 APR

• 30-year interest-only loan at 7.42 APR1

• 40,000 big down payment
• 0 left to invest
• 1,383 monthly payment (56 is tax deductible
  first year/33 average)
• 1,227 average monthly net after-tax cost2
• Sends 100 monthly to lender in effort to
  eliminate mortgage sooner

• 10,000 small down payment
• 30,000 remaining to invest
• 1,175 monthly payment (100 is tax-deductible
  first 15 years/64 average)
• 799 monthly net after-tax cost3
• Adds 100 monthly to investments, plus 428 saved
  from lower mortgage payment, where account earns
  8 rate of return4

Who made the right decision?
The above hypothetical examples are for
illustrative purposes only. Plans vary based on
the needs and wants of the customer. Illustrated
interest rates are based upon the monthly average
interest rates compiled by the Mortgage Bankers
Association of America for January 2002. 1 This
example is based on a Fannie Mae Interest First
loan fixed at 7.42 APR. Interest only for 15
years, then the first loan converts to a 15-year
amortizing loan on the 15th anniversary with a
mo. payment of 1,753. 2 Assumes combined
federal/state income tax rate of 32. 3 Assumes
combined federal/state income tax rate of 32.
Net after-tax cost shown is for years 1-15
average for years 16-30 is 1,540. 4 Assumes 8
rate of return. Rate of return may vary based on
type of investment.
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A Tale of Two BrothersAdapted from the book,
The New Rules of Money

• Results After Just 5 Years

• Received 14,216 in tax savings1

• Received 22,557 in tax savings1

• Has 0 in savings and investments2

• Has 83,513 in savings and investments2

What if both brothers suddenly lose their jobs?

• Has no savings to get through crisis

• Has 83,513 in savings to tide him over2

• Cant get a loaneven though he has 74,320 more
  in equity than his brother because he has no
  job
• Must sell his home or face foreclosure because he
  cant make payments
• At this point, its a fire sale, so he must sell
  at a discount, then pay real estate commissions
  (6-7)

• Doesnt need a loan
• Can easily make his mortgage payment even if hes
  unemployed for years
• Has no reason to panic since hes still in
  control remember Cash is King!

How ironic Brother A, who never wanted a
mortgage in the first place, is now in financial
jeopardy because he was trying to get rid of his
loan too quickly!
The above hypothetical examples are for
illustrative purposes only. Plans vary based on
the needs and wants of the customer. 1 Assumes
combined federal/state income tax rate of 32. 2
Assumes 8 rate of return. Rate of return may
vary based on type of investment.
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A Tale of Two BrothersAdapted from the book,
The New Rules of Money

• Results After 15 Years

• Received 25,080 in tax savings1

• Received 67,670 in tax savings1

• Has 30,421 in savings and investments2
• Owns home outright

• Has 282,019 in savings and investments2
• Remaining mortgage balance is 190,000 and he
  has enough savings to pay it off and still have
  92,019 left over, free and clear.

• Received 25,080 in tax savings1

• Received 107,826 in tax savings1

• Has 613,858 in savings and investments2
• Owns home outright

• Has 1,115,425 in savings and investments2
• Owns home outright so starts fresh and enjoys
  the same benefits once again.

Now...which do you think is the right course of
action the old way or the new way?
Remember...Cash is King and Brother B now
has more than 1.1 million in savings and
investments!
The above hypothetical examples are for
illustrative purposes only. Plans vary based on
the needs and wants of the customer. 1 Assumed
combined federal/state income tax rate of 32. 2
Assumes 8 rate of return. Rate of return may
vary based on type of investment.
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A Tale of Two BrothersAdapted from the book,
The New Rules of Money

• The Moral Of Our Story

• The Old Way of Thinking can be devastating to
  your financial future.

• You should never send any extra money to your
  mortgage company. Instead, put that money to work
  for you.
• Once you have all the facts, its easy to make
  the right decision.

People who understand how money works choose to
carry a big, long mortgage and never pay it off.
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How to Win the Money Game

• The Financial Education Institute is one of the
  nations premier sources for higher education on
  how to help you harness the power of your
  mortgage.

How to Win the Money Game
1. Leverage old money you are already spending to
create new money you can invest. 2. Harness the
power of compound interest to work for you, not
against you.
Educating and empowering consumers is a way of
life at Financial Education Institute. We do
whats right.
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Harness the Power of Your Mortgage

• No matter what your approach, the new generation
  mortgage options can help you.

• Traditional mortgage products including
  fixed-rate loans (15-, 20- 30-year terms), ARM
  loans (3-, 5- 7-year terms), balloon loans
  (5/25 and 7/23 terms), second mortgages and home
  equity loans.

• Interest-only loans products that allow you to
  pay just the interest each month, maximizing your
  tax benefits and freeing up more money to save or
  spend.
• The Power Option Loan concept an ARM loan that
  allows you to choose from four payment options
  each month, giving you maximum flexibility and
  control.

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Buy the Right Kind of Mortgage

• 200,000 Mortgage

Choose One of the Above
The Power Option Loan concept lets you choose
from four options each month3
1 This example illustrates the monthly payment
for a 200,000 loan with an APR of 6.75
amortized over 30 years. Payments include
principal plus interest. 2 This example
illustrates the initial monthly payment for a
200,000 loan with a payment based on an
effective first year interest rate of 2.95. The
interest rate is 2.95 in the first month,
interest plus margin thereafter. Payment remains
fixed for the first 12 months. This option
results in deferred interest which is added to
your principal loan balance. APR and payment
amount adjusts annually every year based on an
index and margin and may increase. Projected
composite APR over life of loan is 4.368, based
on initial interest rate, current index, and
margin. APR may vary. The current index is
1.840. Loan To Value Ratio of 80 or
less. 3 Each example assumes that the option
presented is selected each month of the loan
term. For more details concerning the Power
Option Loan concept and products available in
your area, consult with your local World Lending
Group representative. See the last screen for
additional disclosures. 4 These examples
illustrate the initial monthly payment for a
200,000 loan with an APR of 6.23 at closing.
APR and payment are subject to change each month
based on changes in an index and your loan
balance and may increase. APR may vary. Payments
under Options Three and Four include principal
and interest.
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Buy the Right Kind of Mortgage

• What would you do differently if you had the
  option to lower your monthly mortgage payment?
  Would you...

• Pay off high interest rate debt?
• Save more for your retirement years?
• Prepare for your childrens education?
• Plan a family vacation?
• Prepare for a financial emergency loss of job,
  major medical expenses?

The choice is yours.
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How Money Works

• Now that you know how to get better value for
  your money, lets see the impact of the money
  you save over time.

The Magic of Compound Interest
10,000 - Lump Sum Investment (invested one time
only compounded annually)
The Rule of 72 Divide 72 by the interest rate to
estimate the number of years it takes for your
money to double.
Age 4 Age 8
Money Doubles Money Doubles
Every 18 yrs Every 9 yrs
29 10,000 47 20,000 65 40,000
29 10,000 38 20,000 47 40,000 56 80,000 65
160,000
The above hypothetical examples are for
illustrative purposes only and do not represent
any particular investment vehicle. The Rule of
72 is a mathematical concept that approximates
the number of years it would take to double the
principal at a constant rate of return. The
performance of investments fluctuates over time,
and as a result, the actual time it will take an
investment to double in value cannot be predicted
with any certainty.
0
18
36
years
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What the experts are saying

• Carrying a mortgage doesnt cause you to lose
  any money at all. In fact, just the opposite is
  true carrying a mortgage is actually quite
  profitable. Its eliminating the mortgage that
  forces you to give up profitable opportunities.
• If you have a mortgage and youre dreaming of
  the day when you make your final payment, youre
  trying to do something that financially
  successful people do not do.
• Ric EdelmanNew York Times Best-Selling Author
  of Ordinary People, Extraordinary Wealth

Secret 1 Discover how to turn your mortgage
into a wealth-enhancing tool.
Ric Edelman is the best-selling author of
Ordinary People, Extraordinary Wealth, The Truth
About Money, The New Rules of Money, Financial
Security in Troubled Times, and Discover the
Wealth Within You. His firm, Edelman Financial
Services, Inc. is the nations fifth largest
independent financial planning firm, with more
than 1.7 billion in client assets.
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Get Started Now

• If you are like most people, youre ready to
  take the next step.
• You need to get started today

• Register now for the next workshop class at
  www.DumpYourMortgage.com

Its time for you to harness the power of your
mortgage and start winning the money game.

• The 295 dollar introductory class is now being
  offered at no tuition cost! But you must hurry.
  This offer will not last forever.