Money To Live

February 13, 2012

Mortgage milestones

Filed under: debt,home,loans — by moneytolive @ 10:21 pm

Paying off a mortgage is a long slog. While we make extra principal payments each month, it is sometimes hard to get excited about our progress.

Last month, though, we reached an important milestone. Our monthly principal payment is now larger than our monthly interest payment!

As with any big goal, it is helpful to break it down to more achievable mini-goals. Any time we reduce the principal by another $10,000, that’s reason to celebrate. Last year, we got excited about our mortgage balance when it matched our non-home assets. Theoretically, if taxes and transaction fees did not exist, we could pay off our house with our other investments and retirement savings. Since paying off the mortgage is only one of our financial goals (along with saving for retirement, a new car, and a rainy day), we won’t actually do this.

February 6, 2012

Secret Savings

Filed under: family finances,savings — by moneytolive @ 8:22 pm

Some people stash money away secretly from a partner, but that’s not what I mean by secret savings. I’m talking about keeping it a secret from yourself. My mom and my husband both do it; I don’t.

As a girl, I remember my mom showing me her check register and how she rounded up every withdrawal a little bit. That way, there was always extra money in the account.

Hubby R has two secret stashes, at different locations. One of his stashes is in a CD and would cover 3 months of minimal living expenses, but it’s not allowed to be counted as part of our emergency fund. I think of it as his "Knight in shining armor fund." If our finances completely collapse (not likely), he can ride in on a white horse to save the day. His other secret stash is the "zombie attack fund." It’s about 3 weeks worth of living expenses stored in cash at a secure, alarmed location.

Despite these two accounts being "secret," I include them in our monthly net worth statement. Each month, R reminds me that these don’t count and that I’m supposed to forget about them. I laugh.

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