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Joined: Oct 2005
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Campfire Oracle
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Campfire Oracle
Joined: Oct 2005
Posts: 79,321 |
Debt has always made me uncomfortable. I think that's been a good thing.
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Joined: Oct 2005
Posts: 79,321
Campfire Oracle
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Campfire Oracle
Joined: Oct 2005
Posts: 79,321 |
I've heard quite a few credit card horror stories. A young man I once worked with mentioned that he was $60,000 in debt with credit cards,..had a wife and two kids. I know about what his take home pay was because it was the same as mine.
He had enslaved himself with credit cards. He was working his life away just to pay the interest on $60,000 of credit card debt.
I've heard other stories too. Some people just can't handle a credit card.
I've had one in my wallet for decades. I'll keep one until it expires and never use it. The last time I used a credit card was in a gun shop about 15 years ago. They had a stack of boxed up Springfield Armory Mil Spec 1911's for $349.95. I didn't have a checkbook with me and didn't feel like going to the bank, so I put it on the card,...paid for it when the bill came in.
Haven't used it since. I don't recall using it before.
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Joined: Jan 2002
Posts: 12,816
Campfire Outfitter
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Campfire Outfitter
Joined: Jan 2002
Posts: 12,816 |
wife and i have been trying to get out of debt and be good and do the right things but it was taking us forever. i was a financial adviser for years and i knew the right things to tell a client, but money is behavior, not math. we all know how to save money. but you have to DO the behavior to actually save it, etc.
so after several years of not much progress, our renter passed away while living in our small rental house in the city. we had to gut the whole thing and re-do basically everything, as she had let it get pretty nasty over the last year and a half since her health went downhill.
during the project we discussed ideas and decided we could get way ahead fast if we moved back into it, despite having much less room and being in a not so nice area.
so we listed our home, knowing the market timing was good. guy walked into our open-house and bought it within an hour. even offered 10k more than we asked.
we close on the 13th and this week has been a bit crazy...been 3 months of cleaning and fixing and painting and etc. every night after work and all weekend every weekend.
in short, i decided to take the advice i had been giving for years and live on less and accelerate our debt repayment.
with this sale of the house, we will wipe out more than half our debt, and it looks like 2 to 3 years in the little house will get us out completely. going from a 950 house payment to a 255 house payment, on the little 39k house i bought when i was single.
this is still the land of opportunity, and i am taking advantage of my opportunity. it also woke me up when corona virus hit and boss said 'you and you and you are not essential' and i ended up at home for 2 weeks. i worried like hell...how easily could he have said 'we are closing and you're unemployed' and i would have been in a very bad spot.
i don't make huge money as a QC manager, but i make enough that the two of us can be debt free in a couple years and then build our dream house in the country.
if i can do it you can too. rip off the bandaid and get 'er done. might be the best thing you ever do. Well done. Success is not about having more money, it’s having enough.
Sic Semper Tyrannis
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Joined: Jan 2008
Posts: 15,741
Campfire Ranger
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OP
Campfire Ranger
Joined: Jan 2008
Posts: 15,741 |
Gee I wish the 2 real estate agents and the appraiser and the auditor all knew as much about the real estate valuations in my zip code as true grit...lol
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Joined: Feb 2005
Posts: 4,415
Campfire Tracker
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Campfire Tracker
Joined: Feb 2005
Posts: 4,415 |
Politicians would prefer everyone stayed deep in debt. They give tax incentives to promote it.
Politicians would prefer everyone smoked.....given the taxes on a pack of cigs.
Politicians would prefer everyone play the lottery.
Politicians would prefer everyone else die when they reach Social Security/Medicare age.
Take care of yourself. Let the Jones's be the politician's poster child.
"Those that think they know everything are annoying those of us that have Google." - Dr. D. Edward Wilkinson
Note to self: Never ask an old Fogey how he is doing today.
Revised note to self: Keep it short when someone asks how I am doing.
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Joined: Jan 2006
Posts: 69,255
Campfire Kahuna
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Campfire Kahuna
Joined: Jan 2006
Posts: 69,255 |
Paying off the mortgage is one of the best reliefs you can have. My 1st wife and I had been paying double payments on this one for a number of years so we'd have it clear when I retired. Then she got cancer and passed away in '06. I got a nice death benefit from her employer, enough to pay if off and then some so I decided to do just that. My brother was pretty good with finances and he recommended that, since investments were paying a higher rate than my mortgage was costing, I invest it and keep paying the mortgage. I'd be money ahead. However, I wanted to be out of debt so I paid it off. That was in '07. Then came the '08 stock market crash. I would have taken a huge hit if I'd invested it. Instead, I was sitting on ZERO debt.
The future is never secure. Being debt free is the best protection you can have against the unknown.
“In a time of deceit telling the truth is a revolutionary act.”
― George Orwell
It's not over when you lose. It's over when you quit.
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Joined: Apr 2015
Posts: 575
Campfire Regular
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Campfire Regular
Joined: Apr 2015
Posts: 575 |
Sounds like you and the wife have thought it through, devised a plan that works for you and are executing the plan. Nice job. That makes you smarter and more disciplined than most.
There are plenty of folks (as you can see) who have to tell you that your approach to personal finance sucks because it isn't their approach. So what? Maybe they have some sort of insecurity issues because I didn't notice in the OP that you were asking for financial advice.
It doesn't matter if you fall into the "debt free" camp or the "use leverage to make money" camp or somewhere in between. If you are making responsible financial decisions with an end goal in mind, more than likely you'll wind up better off than most. The only unsolicited advice I will offer is to take the time to educate yourself as much as possible on both approaches so that you can truly make the best decisions for yourself and your family.
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Joined: Dec 2010
Posts: 14,408
Campfire Outfitter
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Campfire Outfitter
Joined: Dec 2010
Posts: 14,408 |
good plan. i listened to DR 30 years ago and while i haven't done exactly as he advises, we have kept debt to a minimum and savings to the maximum and lived well under our means but still managed to raise a family and have some fun. it has paid off and we are at the point in life where we are reaping the rewards. when i ride around here and see the 500k houses with the 60k vehicles in the driveway, i wonder how many of those people are sweating bullets about now.
My diploma is a DD214
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Joined: Jul 2009
Posts: 4,475
Campfire Tracker
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Campfire Tracker
Joined: Jul 2009
Posts: 4,475 |
To the Op - congrats, that’s awesome. Stick with it and you’ll be glad you did.
So many people live beyond their means it’s scary. And I’m not talking a little bit either. Rem141 is right about the people sweating with the $500k houses and $60k vehicles. And in some places you can add another zero onto the house price
I’ve got a close friend and we’ve been fairly even in terms of our earnings thru the years. I’d be willing to bet we have roughly equal assets. Difference is I own my real estate with minimal debt and he is leveraged to the hilt on real estate of roughly the same value. His risk profile has always been higher than mine and he is a smart guy so it will probably work out for him in the long run, but I can promise you I sleep better at night
Last edited by ShortMagFan; 08/05/20.
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Joined: Sep 2013
Posts: 1,516
Campfire Regular
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Campfire Regular
Joined: Sep 2013
Posts: 1,516 |
Started taking DR's advice back in '07. Haven't had a credit card (except for a corporate card) or a vehicle payment since, and won't if I can help it.
One thing I figured out: BUDGET!
Now, this doesn't really mean you have to live like a pauper. If you have the money, live like you want. But budget everything. If you want to make a double house payment, budget. Groceries, budget. Utilities, budget. Guns, budget. Wife's clothes, budget. Weed and Hookers, budget. Budget according to what you want to spend and save, and go from there. A budget is your plan to get out of debt. It can be revised whenever you like, but have one.
Lots of folks re-finance, downsize homes, or just wait on a "light month" to pay on their debt (ain't no such thing as a "light month"), but they never have a plan, and wind up doing the same thing they did before, which is spending more money than they make.
It's a bit easier with auto-withdraw these days. If you want to pay your car off quicker, just add $100 a month (or whatever) to the auto withdraw. Same for the house, second mortgage, whatever. Budget those numbers in. It comes out automatically. You never miss it. You're just aware you have more money when you pay something off.
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Joined: Feb 2010
Posts: 16,064
Campfire Ranger
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Campfire Ranger
Joined: Feb 2010
Posts: 16,064 |
You are on the right track my friend. We paid our house off seven years ago. We’ve always saved and invested monthly, but being debt free allows us to live comfortably on my wife’s income and invest mine. I am now 47, and intend to retire next year.
Most people don’t live within their means because the allure of instant gratification is strong. I can assure it is well worth the effort.
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Joined: Jan 2008
Posts: 15,741
Campfire Ranger
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OP
Campfire Ranger
Joined: Jan 2008
Posts: 15,741 |
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Joined: Nov 2016
Posts: 678
Campfire Regular
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Joined: Nov 2016
Posts: 678 |
Good for you op, wife and I are doing the same. We’ve had our house paid off for several yrs, but we’ve had other loans. Paid off a car and equity loan during the rona virus, we have our half of our two boys college loans and 2 other car payments left. My mom passed away 2 months ago and when the estate is settled we’re paying off everything. Looking forward to being 100% debt free .
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Joined: Jun 2020
Posts: 10,840
Campfire Outfitter
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Campfire Outfitter
Joined: Jun 2020
Posts: 10,840 |
Yep. Put that $700 of mortgage savings to good use
FUGK CCP
It’s time to WAKE UP
GOD BLESS THE USA
WWG1WGA
THERE ARE NO COINCIDENCES
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Joined: Jan 2012
Posts: 26,444
Campfire Ranger
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Campfire Ranger
Joined: Jan 2012
Posts: 26,444 |
We're in the process.
Fixing all of the minor things and imperfections at our current home in Virginia[getting it ready so to speak].
Sitting on the porch late last night having a beverage and surveying my surrounds it hit me that even if we wanted to stay we're getting to the age where it's hard to keep up with all of the maintenance required for the home/land we love so much.
Between the landscaping, keeping the all wood exterior[just completed washing and staining], pushing the woods back 365 days a year etc it's just becoming too much.
Our other house in Tennessee is low maintenance exterior-wise and I'm starting to like that, just can't do neighbors after 30+ years without.
FJB & FJT
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Joined: Dec 2008
Posts: 78,300
Campfire Oracle
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Campfire Oracle
Joined: Dec 2008
Posts: 78,300 |
Thanks. Been a long road and I am willing to be uncomfortable for a couple years if it means freedom. Good for you! And the first thing you'll discover is that you WON'T be uncomfortable! I became solvent at the age of 37, and have remained that way for the next 30+ years. I have what most would consider a modest home ( 2000K sq ft.) and what anyone would consider a modest income, if not sub-modest. I don't have a 22ft. fishing boat, or a 38 ft. camper/trailer/motorhome or a brand new $80k Silverado pickup. I can go on a month long vacation for less than the gas and insurance cost on a motorhome. I can go on multiple guided fishing trips for less than just the maintenance costs on a boat. I can rent virtually any vehicle I want for vacations and run the schitt out of it for less than one truck payment. Its not rocket surgery, and its not hard...
"...the left considers you vermin, and they'll kill you given the chance..." Bristoe
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Joined: May 2014
Posts: 5,817
Campfire Tracker
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Campfire Tracker
Joined: May 2014
Posts: 5,817 |
Scurry and hustle and bustle. History is filled with "wise" people who left their "fruits" to those who squandered them. 4 score and 10 is what we get, and often times the last 20 are health compromised.
The only treasure worth anything in the long run is a relationship with Jesus Christ.
"time and tide wait for no man"
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Joined: Nov 2002
Posts: 33,666
Campfire 'Bwana
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Campfire 'Bwana
Joined: Nov 2002
Posts: 33,666 |
Paying off the mortgage is one of the best reliefs you can have. My 1st wife and I had been paying double payments on this one for a number of years so we'd have it clear when I retired. Then she got cancer and passed away in '06. I got a nice death benefit from her employer, enough to pay if off and then some so I decided to do just that. My brother was pretty good with finances and he recommended that, since investments were paying a higher rate than my mortgage was costing, I invest it and keep paying the mortgage. I'd be money ahead. However, I wanted to be out of debt so I paid it off. That was in '07. Then came the '08 stock market crash. I would have taken a huge hit if I'd invested it. Instead, I was sitting on ZERO debt.
The future is never secure. Being debt free is the best protection you can have against the unknown. You ever figure what that investment would be worth today?
Conduct is the best proof of character.
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Joined: Mar 2010
Posts: 24,089
Campfire Ranger
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Campfire Ranger
Joined: Mar 2010
Posts: 24,089 |
Smart to get out of debt with this economy. Mentioned it before but its crazy the amount of people buying big non essential items. wife and i have been trying to get out of debt and be good and do the right things but it was taking us forever. i was a financial adviser for years and i knew the right things to tell a client, but money is behavior, not math. we all know how to save money. but you have to DO the behavior to actually save it, etc.
so after several years of not much progress, our renter passed away while living in our small rental house in the city. we had to gut the whole thing and re-do basically everything, as she had let it get pretty nasty over the last year and a half since her health went downhill.
during the project we discussed ideas and decided we could get way ahead fast if we moved back into it, despite having much less room and being in a not so nice area.
so we listed our home, knowing the market timing was good. guy walked into our open-house and bought it within an hour. even offered 10k more than we asked.
we close on the 13th and this week has been a bit crazy...been 3 months of cleaning and fixing and painting and etc. every night after work and all weekend every weekend.
in short, i decided to take the advice i had been giving for years and live on less and accelerate our debt repayment.
with this sale of the house, we will wipe out more than half our debt, and it looks like 2 to 3 years in the little house will get us out completely. going from a 950 house payment to a 255 house payment, on the little 39k house i bought when i was single.
this is still the land of opportunity, and i am taking advantage of my opportunity. it also woke me up when corona virus hit and boss said 'you and you and you are not essential' and i ended up at home for 2 weeks. i worried like hell...how easily could he have said 'we are closing and you're unemployed' and i would have been in a very bad spot.
i don't make huge money as a QC manager, but i make enough that the two of us can be debt free in a couple years and then build our dream house in the country.
if i can do it you can too. rip off the bandaid and get 'er done. might be the best thing you ever do.
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Joined: Feb 2009
Posts: 11,910
Campfire Outfitter
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Campfire Outfitter
Joined: Feb 2009
Posts: 11,910 |
Good for you.
We got the house paid off long ago and have done some updating on it over the years.
The last stuff we did cost about 24,000 and most of it has been paid off.
It is nice not having a house payment that can now go into something else.
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