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Discussion Starter #1
Except the house! :)

Back in March - the wife and I did this:

http://www.tlzone.net/forums/showthread.php?t=66244

Which for the un-initiated - was cut up all of our credit cards!

Well, in addition to being disciplined to not borrow even one more cent...We proceeded to pay off our HELOC, all of our credit cards, two $10k student loans and two cars - one of which is the 2006 Toyota Matrix we bought back in September of 2005.

Now we're on track to throw all of the payments that we HAD been making to everyone and their brother toward principle payments on our house. Goal is to be out of our mortgage by June of 2008!

It's an amazing feeling to be going to work to bring home money for...well, for me and the wife instead of Sallie Mae, College Loan Corporation, Toyota Financial, MBNA, Bank of America, Citizens Bank and so on!

Just thought I'd share! :burnout
 

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congrats! :thumbup

My gf just got a very generous loan from her dad to pay off her debts. she was paying around $250 a month just in interest!!

debt free is the way to go, I was almost there, then I bought a car, then a DRZ...then stuff for the DRZ...
 

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Congratulations :hail :hail :hail

I got laid off 16 years ago, and got caught in a financial tangle that took me 3 years to resolve. :banghead From that day I vowed that other than the mortgage, we'd never owe more than we could clear with a pay-cheque at the end of the month. We may not have the latest car, or go on flash holidays every year, or have mini movie theatres for a TV, but I like not having the noose of loans around my neck :O :)

It tickles me to be told I have a relatively low credit rating, because I have little debt :confused :dowhat
 

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Chief Moderator for my kids Julia & Kristen,
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Congrats! Way to step off the treadmill! It is seemingly a truly counterculteral notion to live below your means and not be maxed out on your credit.

I decided in my early 20's to be in the same happy boat my whole adult life. Millionaire next door, live below your means stuff since then. That was about 20 years ago. Never carried a credit card balance or even a car loan except for a 0% deal on my Toyota Tundra. I had the cash to buy that and elected to take the loan and get investment return on my cash instead. If I did not have the cash, I wouldn't have bought the truck, period.

This approach has really paid off for me in spades. Even though I have never made more than 75K a year and for most of my career I have made far less, retiring with at least a million in the 401K plan within the next 11 years at age 55 looks very doable and I have a nice investment porfolio of my own going. I am not "rich" by any means compared to many people I know, but money is of no concern given my frugal lifestyle either. I pinch pennies and am pretty tight, but don't mind occasionally spending some money on the things I want. For example, paying parking valets at restaurants and more than $6 for lunch bugs me and I brown bag it a lot, but paying 8 grand cash for my new FZ-1 that I plan to keep for 7-10 years bugs me not a bit. It is the everyday stuff that drains us. Watch those expenses and you can accumulate savings. You can also occasionally "splurge" on something to keep it real and doable. Doing only penny pinching is not sustainable over the long haul.

Sock that extra money away in your broadly diversified 401K plan and keep at it over the long haul. Financial security and independence beats the hell out of a bunch of depreciating fancy assets that are owned by the credit card company or the bank. :hail
 

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How the hell do you pay off a house that quickly?


please tell me, even with my very large mortgage payment I have no illusions about every paying it off.

we have no debt other than the house.
 

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...congrats:thumbup
 

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+1

great deal. congrats :hail
 

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Discussion Starter #8
How the hell do you pay off a house that quickly?


please tell me, even with my very large mortgage payment I have no illusions about every paying it off.

we have no debt other than the house.
Without giving out our entire financial picture...

It's quite simple actually.

The monthly payments we used to make:

Toyota: $435
Ford: $385
Sallie Mae: $335
College Loan Corp: $313
HELOC: $117
MBNA: $125
Various Store Cards: $225
Grand total STUPID Debt Payments: $1935 per month.

Add that to the one payment we now HAVE to make on our home: $999 and it kicks a mortgage amortization table squarely in the a$$. (BTW: We made a significant down-payment on our current home)

The other thing that has helped us is exactly what Duke outlined above. We've committed ourselves to living WAY below our means. We haven't seen the inside of a restaurant (where we've actually paid the bill) since March of this year. We bring our lunch to work 3-4 days a week. We got married last year and decided to skip the Honey Moon all-together. We have no kids. We just live on a LOT less than we make and will surely be better off for it in the long run.

AND - I went in to my benefits office today to max out my 401k.

It sounds a bit like bragging when I read back through this stuff. But what I'm trying to get at is that it isn't that complicated.

Financial institutions have us so incredibly programmed to be in debt forever that most people just surrender to it. The definition of the FICO score is your ability to handle DEBT. And how many money people are currently expounding the benefits of increasing your FICO? By definition - increasing your FICO just tells lenders that you BORROW money well. Here's a thought - don't borrow and you'll have something much more powerful than your FICO: It's called money!

:)
 

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big congrat....

i can't wait for that day also
 

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i recently paid off my wife student loan. that was the last thing we owe on besides the house. we have bought both our cars used and cash. sv and TL were cash too. no cc debt and no kids here or in the plans. paid off $50K on the house in the last 3 years (still a monster monthly mortgage in CA).

my goal is to pay it off as soon as i can but this is going to take a while...
 

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Chief Moderator for my kids Julia & Kristen,
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I've been kicking around an idea for awhile now, I call it living with a "margin" vs. "marginless" living. Like so many things in life, the idea first took shape because of motorcycle riding.

Look at it like this. When riding a bike, you can go comfortably fast up to about an 80% pace. Push harder than that and you cross a tipping point and use up your reserve, your "margin" if you will. You become hurried, you ride raggedly, you make make mistakes. Instead of precisely hitting your marks and being smooth and in control, you are rushing corners too hot, making corrections, working hard. You are in danger of crashing if something unexpected pops up and your brain goes into sensory overload. At your 80% pace, you can easily deal with a splatted squirrel past the apex, or, if you are on the track, something like a front end slide or another rider crashing in front of you.

Life is like that. Having "margin" in your life can take two basic forms. It can be "financial margin" as we are discussing here, or "time/work margin." Society tells us that we need to make all the money we can, enroll our kids in a variety of activities and to "be all we can be" and such. Lenders push us to take on all the debt we can take on. We wind up living with no financial margin, having to work our asses off to make as much money as we can, to pay off stuff that we purchased on credit and don't have time to enjoy while we rush the kid off to yet another soccer practice. Society praises this. It is a horrible way to live. Much like the rider pushing too hard and using up his reserve, living with no financial/work/time "margin" ultimately results in a "life crash".

Bikes have been a good teacher. I attribute much of the good things that have happened in my life to the early and still continuing teachings of my motorcycles. Bikes will physically thump you hard when you use up your skill reserve and cross the line. Life may not be so immediately black and white, but same principle holds. We all have financial limits and time limits. Living comfortably within them helps in making consistently sound decisions. Pushing too hard by going into into "marginless living" and life does not go well.

The 4th commandment, interestingly, contains more elaboration than the rest says: "Remember the sabbath day, and keep it holy. Six days you shall labor and do all your work. But the seventh day is a sabbath to the Lord your God; you shall not do any work...

See, even God wants you to take a break and kick it one day a week. :)
 

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Wow,

Well Awesome job JIm

Man wish I was that discipline

I thought you had a 401 K over a year ago. It was you and Duke whom encourage me to get mine going. It's going now and I donate 100.00 a month to it.

Not much I know.

I owed 100K on the house and refinance for 135.000 for 15 years.

I went from a ARM of TBill plus 2.75 percent changed yearly with that formula to a fix 15 year mortgage. I paid off my student loans and the wife with the extra money borrowed on the house. I paid off a few other bills too like my 1999 Silverado but that did not last long the freaking van broke down so we borrowed money for another one. :banghead

I still have 3 cc cards One visa, American Express, and Lowes.

My target now is Lowes.
 

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All the advice here is great!

At the age of 30 I have 1 car payment, $15k in student loans, 1 credit card with $0 balance and the house. (but there are parts to buy for the Tl) :devious

Paying the mortgage is a necessary evil and I don't mind because I love the house and it gives the kids a place to grow up.

Student loans are a necessary evil and the rate is reasonable compared to the cost of not having an education.

Being out of debt is a dream for the majority of the U.S., but careful planning and frugal spending can be a big asset!

It's hard these days to be out of debt at my age, but well worth the effort!
I hope to have my mortgage as my only payment in 5 years...I hope.
 

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We've got the mortgage and our student loans and that's it.
I've almost got mine paid off, but the wife's will take a bit more time.
It's tough to get ahead with daycare and all the other expenses that come with having kids, but I wouldn't trade that for the world.
 

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Discussion Starter #15 (Edited)
Wow,

Well Awesome job JIm

Man wish I was that discipline

I thought you had a 401 K over a year ago. It was you and Duke whom encourage me to get mine going. It's going now and I donate 100.00 a month to it.
You're correct, Del - I did have a 401k over a year ago, and I made considerably smaller contributions to it then - actually I started it in my early 20's.

I did, however, decide to reduce my contributions to ZERO back in March in an aggressive effort to get out of debt - but then just maxed it out today at $15k per year after achieving our goal!

You're definitely on the right track by contributing some $$ to it today. You'll thanks yourself later! :thumbup
 

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It's tough to get ahead with daycare and all the other expenses that come with having kids, but I wouldn't trade that for the world.

I rank "kid expenses" at the top of the list!

I wouldn't trade the memories my children have given me for anything!

When the day to day life of having kids (5 & 9) is done I will be 43 with 1 in college.
hopefully I have done enough now to prepare for that time...
 

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Kids (or rather care costs) are one of the main reasons we can't make better inroads to getting rid of the mortgage - but house and family are a choice you make ..... we didn't have to, but wouldn't be without ... :O




A little food for thought I was told the other day .... £10 ($20) per week invested in a normal savings account for a baby born today, until they are 18 yrs old, then the lump sum left untouched until they are 55, will net them over £1 million ($2m) based on current interest rates - and that's with the money hardly working compared to some investment routes .... :dowhat
 

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Chief Moderator for my kids Julia & Kristen,
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From a purely financial standpoint, having kids is the biggest challenge. If not for the kids, Mrs. Duke would still be a Sr. Marketing Analyst or maybe even a Department Head, making 75K to 100K+ a year. Instead she works 20 hours a week at a church making $12 an hour. She could do the full time bigger money job, but then the extra income largely just gets burned up in taxes and day care expenses. That and the stress. It is just not worth it.

We got a few good earning years in before the kids came and saved a lot of money though. At least the IRS does not rape us so bad these days. Make a good dual income and they rape you hard.
 

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That's awsome:thumbup

I've just got ~7k in student loans and the house but if I get into a good law school I'll likely have no house and a mortage-sized student loan in about 3 years:lol
 
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