The bank no longer has a grip on me – I am 100% debt free.
No credit card debt, no student loan debt, no house debt – they are all paid off in full.
How did I get here? Through careful planning…and then through a whirlwind of hard work and sleepless nights when those careful plans went to crap. It still feels a bit surreal, but as of December 11th, 2014, I am completely debt free (and I intend to stay that way for life).
How I Paid Off My Mortgage – The Crazy Idea Comes Into Fruition
It was about one year after my wife left me. She had demanded $22,000 and I was miraculously able to come up with all of the money in just six months. Sure, I was frugal before and enjoyed saving money, but I had no idea that it was possible for me to . . . → Read More: How I Paid Off My $54,500 Mortgage In Less Than One Year
I have spent the last 11 months aggressively paying down my mortgage with the hopes of making the final payment here in December. So am I going to pay off the mortgage this month? It actually looks promising! Before I get too far ahead of myself, let me show you how I’ve gotten to this point.
From the Beginning: Pay Off The Mortgage in 2014
After paying my ex the $20,000 she demanded in 2013, I realized how quickly I could actually accumulate money! This got me thinking about the mortgage I hated, and I soon began to wonder if I could make it disappear inside of a single year! To do this I would have to come up with $54,500 in 12 short months – not an easy task, but I rolled my sleeves up and dove in.
From the very beginning I cut down on my bills, spent . . . → Read More: Will I Pay Off The Mortgage This Month?
Jim (a regular reader of LifeAndMyFinances) and his wife (Mrs. Jim) absolutely hate their home mortgage. If they had the cash to pay off their bank right now, they would absolutely do it without hesitation. Unfortunately, they do not have $47,000 in cash to do this right now (no big surprise here – that’s quite a lot of money!), so they are considering taking out a loan from their 401k to pay off that nuisance of a mortgage. What do you think, should they do it? Before you answer too quickly, let’s dig into some details as well as the positives and the negatives of taking out a 401k loan.
Jim and Mrs. Jim are in their mid-50’s with about 10 more years of work ahead of them before they retire. They have a 401a account (which is very similar to a 401k) that’s beefed up with $950,000, . . . → Read More: Should Jim Pay Off His Mortgage With His 401k?
Do you currently have a mortgage? Given our economic uncertainty, do you ever wonder if you should be making an effort to pay off the mortgage? What are the pros and cons if you do start making those extra payments? What if you don’t? RB40 recently wrote about this very topic, but as I expected, his perspective was a little bias toward taking on debt. And guess what mine is? You’ve got it, NO DEBT! Let’s take a look at my perspective.
Save on Interest
What is the current interest rate on your mortgage? If you have a 30-year mortgage, you likely have an interest rate over 4%, which means that on a $250,000 loan, you’re paying $180,000 in interest over those 30 years! If you bought your house for $300,000, after the interest, you actually paid $480,000 for it. Good luck selling that for a profit!
Now, . . . → Read More: Should You Pay Off the Mortgage ASAP?