Killing the mortgage

A mention was made recently about Early Retirement Extreme. Intrigued, I took a look at it – both the wiki and the blog. Honestly, it’s not somewhere that I want to go, especially since I’m raising two boys on my own (I’m a widow), ages 12 and 10. But it set me to thinking that if those people can be so extreme, I could certainly step up my game a bit.

Some background – I have a comfortable job, which is as secure as anything can be (that is, I’m pretty sure it’s secure). I telework from home fulltime.

I save enough for retirement through a thrift savings plan (federal job), Roth IRAs, and the kids’ college accounts (529 plan). I have a few pensions in play, both from past jobs as well as my current position, rollover 401K, etc. I’m on target to have a nest egg of about 2.2 million at retirement.

We take a good vacation every year. I can pay the bills plus save some extra on the side. I shop at yard sales for household furnishings and clothes, but spend way too much at Costco! I moved to a college town purposely after my husband died so that my boys could stay at home while attending college and they won’t even need a car (bicycles rule in Chico, CA).

I still have a mortgage a bit above $160,000 but the house is probably valued around $400,000 (Zillow puts it at $463K). At my current repayment rate, I will have my home paid off in just under 12 years.

I was toying with the idea of throwing any ‘extra’ money towards the mortgage (my heart says to do that) but the analytical side of me says no, invest aggressively. I’ve been investing that money instead in the Lending Club and I’m very pleased with my return (currently 18% but will probably end up being around 11% after some default way down the road) and will continue to invest about $300 a month there.

So all is good but I can do better. So, I think I’m going to do a reboot of my finances and put myself on a bit of a financial diet. Trim a little bit here and a little bit there and throw any of that money towards the mortgage. So I can do the smart investing AND try to chip away at that last big debt – the mortgage.

I’m going to learn how to groom my dog myself instead of paying $35 every few months to have it done professionally. I’m going to have one ‘no spending’ week per month (ok, maybe fruit and milk). I’m going to focus on eating through the pantry and freezer stores. I’m going to declutter and sell anything that isn’t beautiful or useful (now, not someday). I won’t just wander through Costco and buy whatever strikes my fancy!

I will continue to pay my handyman/contractor for home improvements, but there are things I can do myself such as painting, redoing the stairs, etc.

I honestly don’t need a housekeeper (I have one that comes every two weeks for 3-4 hours). Instead, I will consider that cardio and clean energetically for my workout. The kids can help more with cleaning the bathrooms and vacuuming.

I honestly think that if I focus hard on this, I can probably free up $1000 extra a month to apply to my principal. If I did that, I could pay off my mortgage in 6 years and 2 months, not my current 11 years and 11 months. Wow! It would be paid off right around the time my older son startscollege.

Typing all this, I’m kind of getting excited about the thought. OK, accountability check. My current mortgage is $161,840. Let’s see just how much I can kill it over the next month or two.

You reminded me of a couple of key points

First, both our businesses are run on a cash basis. If we cannot pay cash, we don’t do it, buy it, or whatever. It wont happen till we have cash. The way I see it, paying interest adds unnecessary costs to overhead and eats into profit and expansion.

Second, most of what we sell at our store front consists of necessary work clothing for men and women in our area, mostly men. Due to their hazardous work most are required to wear steel toe boots, safety hats, and most companies are going to fire retardant clothing. Safety toe boots/shoes and FR clothing are our two big sellers. We try to stick to basics at our store but do have some very nice western boots that no one NEEDS but many want. Our prices range from about $100 up to about $500, retail. We have a very nice profit built but still sell short of MSRP. In my coaster business … no one NEEDS coasters and I run it on a cash basis. No cash? Go to – guaranteed payday loans, or it doesn’t get done/bought/etc. They could use saucers, plate, or napkins to protect their furniture. However they do make fine gift and are practical. My philosophy is that if I would not have it in my home or give it to a close friend as a gift, I won’t sell it. I understand that not everyone’s tastes are the same as mine. That is okay. Figuring my costs are some things are very easy and some are more difficult. My biggest urge that I fight is that there is money in the bank and I see something I think I “need” for my business but it’s really just a nice thing to have.

Husband signs the mortgage modification final paperwork today!

Which means that our interest rate on our loan (well, our biggest one) is locked in at 5%. After a year of fighting with Chase and sending paperwork upon paperwork over and over…and a recent quick check to confirm with them that what we submitted is correct (we were told early on that my income wouldn’t count, but before we signed on the dotted line, wanted official confirmation of that so we weren’t doing anything incorrectly since this is a legal document!).. ..we’ re finally here!
In other great news, we’re only about $10,000 away from what we owe in terms of value. (much better than the $80,000 we were off at the bottom of the market) I think the market has pretty much peaked for a while, so now it’s just to get our principle down so we can re-finance into a better rate and 15 year in the years to come.
Of course, now that I’m feeling stable and on a great path, my husband’ s work is talking to him about the possibility of a job out of state. It’s more money, but I carry the benefits for us, and he has major health issues. It’s all a little terrifying — I’d love for him to be able to take his career further to what it wants to be, but I’m afraid on whether we’d be able to make it all work financially. He’s fine if it doesn’t work out, but I’d hate to give his job the message that he’s not willing to do what he needs to do to succeed.

Just came back from Centrose Nursery in Gardena (CA)

Heard they were THE PLACE to go for Tree Collards (Red and Purple).

YEP. Definitely THE PLACE. Picked up a HUGE green tree collard, young purple sapling (John Kohler must have bought them all out!), 18 celery, 6 onions.

Good thing (1) we are just barely back working or I would have spent all day and a fortune there (2) I don’t have an open bed truck, or I could have really gone hog wild.


It is really surprising how “difficult” it is to pay something completely off

I called the 2nd cheetah this morning; they’re the ones who told me last month they would make a deal on late fees and they’re the ones I HAVE to pay off this month (interest free CC until Feb 20).

SO I went to pay them off this morning, and they go “well, FIRST your account has to get current ($178 pmt), THEN you can call back in 48 hours and we’ll waive some fees, THEN you can pay if off it you want.”

What the heck?

Grrr…so as much as I want to pay off a bunch RIGHT NOW…I am going to be patient and wait another 48 hours. They waived 1 late fee right then ($35) but the possibility of them waiving another $70-100 worth, is worth the wait. I don’t wait to pay other stuff off and then find out I don’t have enough to pay this guy off, so I am putting it all on hold for 48 hours.

Wow, that’s awesome

Start calling you the Great Cheetah Hunter! Go get ’em! Do you have any sort of trophy case or tombstones display to show off your various cheetah kills? We’ve only killed off one major debt since starting the DR plan, getting ready to kill off a few more in 2014, and I’m contemplating what sort of trophy display I want to use to celebrate.

Today I am cheetah hunting

Yep, if all works well, I should be able to kill at least 3 cheetahs, maybe 4. I had planned on killing 4 for sure, maybe 5, but then I decided maybe I ought to replenish some immediate staples needs, like oh, toilet paper, allergy meds, stuff like that, LOL.

I just killed one, I know for sure I will be killing another as soon as I get hold of someone willing to make a deal today. Even if they don’t make a deal, they are getting paid off for sure today anyway.

Wish me luck!

The day after the news story broke that Michael’s thought

they might have been hacked when Target was I realized there had been one under $5 debit from a debit card at Michael’s. I found which family member had done it and then called our bank to tell them we had and we would need a new card.

The bank told me they had not been notified of any such threat and unless I wanted to pay a new card, possibly new account set-up fee they weren’t planning on doing anything about it. HUH? I got the person’s name and extension and then went higher up the chain. Nope, unless they were officially notified by Michael’s they were not going to foot the expense for the number change out. That until they were notified officially they were under no obligation to do so. I told them I was notifying them and it was all over the news. No deal

I opted to do the expense myself, better safe than sorry. Telling them I had made a record that I had officially notified them of the possible problem. Yesterday I received notice that Michael’s had officially notifying them now and they would be refunding my fees I paid. Well duhhhh! Luckily no charges had been made between the time I notified them and the new card replacement.