A lot of MM posters are too into Dave Ramsey/Suze Orman for my taste. Not all debt is bad, and it's alright to have some monthly payments, as long as they are within your budget.
I don't think this is really true. Dave Ramsey is pretty heavily reviled. Most MMers seem to prefer savvy debt leveraging.
My BF will be mortgage and debt-free in the next two years, he'll be 37-38. I don't necessarily agree with how he has managed his mortgage and money, but I've only been in the picture a few years.
Essentially, he bought the home 13+ years ago at 22, refinanced to a 15 year loan when interest rates first dropped after 9/11, and has been paying additional each month. He's never had any other debt. He doesn't make a huge salary, and isn't a miser by any means. He just made it a priority. LCOL helped as well.
BTW, I don't like the house and if we remain together, there will be another mortgage taken out.
Post by themoneytree on May 1, 2013 18:16:03 GMT -5
We're debt free including mortgage. It allows me to SAH with the baby, but otherwise cash is reasonably tight because this place is a money pit! We owned our last house outright too.
There were several factors which put us in this position. I bought a very modest house in college with a small deposit and lived with college friends (they paid my mortgage in rent). We've upgraded homes often. Lots of renovating and moving. It's been a lot of risk and a lot of work. It's not for everyone.
If I'm honest this house was probably a mistake - it's a pricey house in a pricey neighborhood. Upkeep on a house like this is insanely expensive. We've done a TON of work to it. I REALLY don't want to move again but we should probably sell it at some point in a year or two and buy something smaller and more manageable.
I also think that mortgage debt is 'good' debt, but we are not comfortable in the stock market and have low risk tolerance in that area. If we were better at it we would have kept a mortgage on the house and tried to outpace the interest rate in the stock market. But we don't have the guts.
Well if we stayed in this house our whole life and did not make any extra payments on the mortgage, I'd pay this one off when I'm 56 lol. Most likely we will move way before then, though. But yeah. I know no one who has been able to pay off their mortgage by 40. My parents still have a couple years left on theirs for the house I grew up in. I can't even fathom being able to pay it off so early.
But yeah. I know no one who has been able to pay off their mortgage by 40.
You may just not know - it's not exactly something we tell people IRL. I have one friend who knows and she pretty much asked me outright. Otherwise none of our friends know.
But yeah. I know no one who has been able to pay off their mortgage by 40.
You may just not know - it's not exactly something we tell people IRL. I have one friend who knows and she pretty much asked me outright. Otherwise none of our friends know.
We don't have many friends over 40, only a handful, and they all complain about their mortgages very often, so I am quite positive they have not paid them off. All of our family is also very open about the fact they still have a mortgage. Many people may not be vocal about it, but people in our lives are. So I can say with certainty that no one I know personally (meaning close friends and family members) have paid off their mortgage by 40. This isn't a pissing contest, just fact.
What do these people DO exactly to be able to afford that? We are barely scraping by with our puny little mortgage and life necessities. Apparently I am in the wrong career :/
I am a teacher and currently h makes no money ( he started his own business). We plan to pay ours off by 45.
BUT. We bought at 25. We have no other debt (no cars or anything) because of our parents and my parents provided the down payment.
We could be mortgage free if we sold our house and bought something else (ETA: we're both 35). We're dreaming of building our perfect house one day so it probably won't happen as we're looking at very expensive areas.
My father left me some money which I used to put a quite large deposit on the house so our mortgage wasn't high to start with and we only have 12 years left on it (from 20). Also we were VERY lucky to buy at a ridiculously low price and it's worth almost double as what we'll end up paying for it.
Had we not had the deposit we'd have taken a 30 year mortgage instead of 20.
We're going to buy a new house next year and do a 15 year so we'll be in our early to mid forties. That's if we don't get another house. That's a big if. We won't be debt free though because H wants to buy some land and rental properties.
What do these people DO exactly to be able to afford that? We are barely scraping by with our puny little mortgage and life necessities. Apparently I am in the wrong career :/
In our case we are both Engineers. He is a GS-14 I am a GS-13 step 4. I never had the goal to pay off the house early, it is just him. He is super debt adverse. It's nice that we will be able to do it, but I don't think one way or the other about it being a goal that someone should have or want to do.
But how we did it: We both took out as few SL's as possible, the Army paid for my education and when we got jobs working for the DoD, they paid the remainder of our SL's (about 16K for each of us). At the moment with no children and really no major bills besides his mortgage, it makes it easy to pay down debt fast and still have money for fun things.
In additional to working full time, I was also in the National Guard as an officer and my drill schedules/training were such that I was making a lot of extra money, plus deployments. Had I not come out of college with too much debt from partying, I'd have a lot more saved. Had I not wanted to buy a fancy car or new sport bike, I'd have a lot more saved. finally have gotten rid of my house, so we are down to 1 mortgage. I made it a point to pay off all of my vehicles. I really curbed my shopping habits since we got together. His truck has been paid off for a while and while it has 187K miles on it, we are keeping it til it dies. We traded in one of my vehicles for a family car that gets good gas mileage since we have quite a commute to work. As you can see I am not the one with the savings mindset.
DH has been agressively paying his mortgage since he bought the house about 6.5 years ago. Every promotion, bonus, went to the mortgage and his savings. Not that he was neglecting his TSP, he has that set to 12% of his salary. But he never traveled much, didn't have expensive hobbies, his grocery and utility bills were super cheap, so he was in a sense very frugal. We did decided to raid a large portion of our savings to pay the mortgage down to where in December it will be paid off, we are building that back up and that should take about a year.
had neither of us had previous divorces where we had to give our ex's the sum total of 24K the house would be paid off.
I'll never understand the mentality that some people have on that board about being terrified of debt. Not all debt is bad. And the "feeling" they speak of about paying off large sums of debt? Yeah, I get that feeling too. Either from sex or going on a really nice vacation. I'd much rather do those.
The sacrifices it would take to pay off the mortgage early are, honestly, just not worth it. I can't imagine skipping vacations or denying ourselves fairly normal indulgences in order to pay it off. It seems like a terrible way to live, imo.
The sacrifices it would take to pay off the mortgage early are, honestly, just not worth it. I can't imagine skipping vacations or denying ourselves fairly normal indulgences in order to pay it off. It seems like a terrible way to live, imo.
This is how I feel too. We'll be 56-57 if we stay at this house, but we're planning to upgrade in the next 5 years, so.... who knows.