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Monday, January 28, 2013

It's All Going According to Plan


Well, we did it.  On Friday the 18th of January, 2013 we paid off the mortgage. Today we received the loan payoff confirmation in the mail, and somewhere in the next three months, we'll receive the title to the house in just our names without the bank listed as co-owner from the county in which we live.

As part of our cost-cutting measures, we moved banks as well. Saturday we closed the old account and took a cashiers check with the remaining balance on it over to the new bank.  There are a lot of things to remember to do when breaking up with your bank; I had to coordinate a variety of transactions to get everything cleared up before the breakup, which finally occurred this past Saturday.  A large part of the reason I wanted it coordinated carefully was that I needed to make sure we had the whole thing cleared out by the end of the month because of exorbitant bank fees if your balance falls below a certain amount.  (Okay, $25,000.  We think that holding our $25,000 hostage to save $30 a month in account fees is pretty expensive for services we no longer need.)

Then Sunday, I built The Chart.

The Chart is a large wall chart showing a graph that tracks your monthly expenses in one color (say, red) and your monthly non-work produced income (from dividends and interest) in another color (green for this one).  The vertical axis is measured in dollars, and the horizontal axis is measured in years.  Where the red line from the expenses crosses the green line from the non-work produced income is determined the date at which your expenses can be covered by non-work produced income, and you can finally quit working for money.

I have our chart set for five years because I'm an optimist.  Steve doesn't think we can do it in five years because he's a realist.

The chart starts with January 2013, so we'll be able to see an immediate reduction in our expenses because the mortgage payment won't be part of them going forward.  This also means that seeing a further reduction in expenses is going to be harder to accomplish, but that is the next goal: paring down our monthly spend.

Steve is already looking at how to save money on the phone bill, and he had the great idea of going with Clearwire for our internet connection and losing Comcast Cable altogether, which would have saved us several hundred dollars a year.  Unfortunately we are just a few streets beyond the reach of service, due to surrounding hillsides. Darn!

My job is to do a better job of planning our grocery trips and using stuff up in the freezer and cupboards. We are going to try making better, more comprehensive grocery lists and stick to shopping only twice a month, preferably on the off weeks from the 1st and 15th of the month.  I also have to rein in my trips to Amazon, and then find other ways to pinch pennies.

But I'm sure we can do it.

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