Are you thinking about financing a purchase on credit? Maybe a new HDTV, or a better car, or a new computer? It’s important to know for sure whether or not you can afford what you’ll be purchasing. I read about a great way to do just that at http://www.forbes.com/finance. Try out the loan for a while by making pretend payments. Pay yourself, and then see how easily you can afford the item. One bonus is, you’ll probably find that if you truly can afford it, you may as well wait a while until you’ve saved up to just pay for it, or at least make a big down payment.
I was thinking about financing a car this year, and then I read something interesting at http://www.forbes.com/finance. What the article suggested was to pretend you’ve already made the purchase, but make the payment to yourself for a few months. I tried it, and I was surprised at what I learned. What I discovered is that because I don’t have a car loan already, if I just keep saving up for a while, I’ll be in a much better position. With the hefty down payment I’m saving up, I’ll be able to afford a better car, or choose lower payments, or take a shorter-term loan.