If you've followed us for a while now, you know that our passion is paying off debt. Whether you joined us when we were first married and started with $100,000 of student loan debt, or if you joined us later in our journey with our first home purchase...we love the topic of paying off debt.
The house we live in now, we purchased at the very end of October of 2017 (last year). In one sense, it was purchased on a bit of whim, but in another we set ourselves up to be able to purchase a new home when the "right one" came along.
This month we are celebrating having half our house paid off! Let me clarify, we have not paid off half our mortgage amount, we simply have a mortgage now that is less than half of what we paid for our house, which is still an accomplishment for us!
* Every week, I check our accounts to see if we have a little extra money laying around we can pay towards our mortgage and make another principal payment. Sometimes we can't, sometimes its $50 or $200...it totally depends on what we've brought in from our side hustles. This is our way of living "artificially poor" (taking money away before we even have a chance to see it)
* Budgeting. We started budgeting for the first time this year, and are learning a lot about our spending habits. It keeps us on the same page and allows us to see where our money is actually going.
Why? Because there is nothing quite like becoming debt-free and having the freedom to make decisions based on what you want to do with your life, rather than what your debt is forcing you to do.
The house we live in now, we purchased at the very end of October of 2017 (last year). In one sense, it was purchased on a bit of whim, but in another we set ourselves up to be able to purchase a new home when the "right one" came along.This month we are celebrating having half our house paid off! Let me clarify, we have not paid off half our mortgage amount, we simply have a mortgage now that is less than half of what we paid for our house, which is still an accomplishment for us!
How are we doing it? Well first, we set ourselves up for success before even stepping foot in our new home.
Even though our first home we owned for only about 18 months (and lived in it closer to 15 months), we made the decision to buy our first home well under budget, and spend some time fixing it up for resale and paying down our mortgage quickly. We did not accomplish paying off the mortgage completely, but we sat on a good chunk of equity in our home by making some good financial choices on our first house (putting 20% down, then working to pay down the mortgage more quickly than just the minimum payments)
When we decided our first home was not going to be our forever home, we paused paying down the mortgage and started saving cash for a down payment on our next house. This allowed us to jump on the house when happened across it on zillow one day. We payed 20% down on our new home as well.
Then when we sold our first house, we took all the equity from our first house and put it towards our new house.
That gave us a HUGE head start to paying off our house, as this allowed us to start with a much smaller mortgage than we otherwise would have.
Now in the last 10 months, what have we done?
* Each month we have an extra $100 automatically sent on the payday that doesn't coincide with the the mortgage payment. We pay that towards principal
* Every week, I check our accounts to see if we have a little extra money laying around we can pay towards our mortgage and make another principal payment. Sometimes we can't, sometimes its $50 or $200...it totally depends on what we've brought in from our side hustles. This is our way of living "artificially poor" (taking money away before we even have a chance to see it)
* Side hustle. From photography to Kevin's graphic design, we believe in having a side hustle that brings in extra income that only goes towards the mortgage.
* Challenge yourself. My favorite thing to look at is to see "we are just $110 away from hitting the $142,000 mortgage amount...lets pay the $110 now and just live a little more inexpensively the rest of the month". I love that once you pay it, you can't take it back...so you're forcing yourself to live a bit more frugally.
* Any extra money that comes in, it goes towards the mortgage. Extra money may be a work bonus, tax return, money you overpaid elsewhere and are getting a refund, selling things from your house...anything we get goes towards the mortgage.
* Budgeting. We started budgeting for the first time this year, and are learning a lot about our spending habits. It keeps us on the same page and allows us to see where our money is actually going.
* We are trying to keep any house updates at a minimum. Would I love new carpet? New floors in the kitchen? New Cabinets? ...yes to all of the above. By setting a goal of when we will have the house paid off, it is giving us the ability to say "okay, we will have those thing, but lets just wait a few more years." making the dream seem more achievable and less far-off!
We still have a long ways to go...but we are getting there! Here is to hitting our goal of having the house paid off in full in 5 years! We are still in love with our new house, and especially have enjoyed our first summer here, as Lorelai is loving the yard, deck, patio and walking around the neighborhood.
I love celebrating milestones like this, because it helps us stay motivated and keeps the conversation between the two of us going...always remembering why we are living a bit more inexpensively day-to-day than we otherwise would, in hopes to become debt-free again soon!
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