Debt Free Journey Story- Mortgage Free

A Fall view of our home

If you know me at all, you know that I am quite passionate about Debt Freedom.  Even before I ever got married, I had the goal of paying off my first house.  That goal has followed me around over the years and houses.  My mom introduced me to Dave Ramsey back in 2004 when I had recently graduated college and had some college debt to my name.  I read the "Total Money Makeover" and started applying the baby step principles to paying off my college debt.  And by December of 2005, within 18 months of graduating college, I had my $21,000 student loans paid in full.  It was amazing to accomplish such a task, especially considering I only worked part time during some of journey.  I didn't follow the steps perfectly, considering the following December I bought my first house.  I didn't have a large downpayment, but still bought the house.  But other than the mortgage debt, I stayed debt free.  I payed cash for my 2nd car.  

I married the Laird in 2010, who was even more financially wise and frugal than myself.  So that was a good combination for money matters within our marriage.  We've both been on the same page when it comes to spending for the whole of our time together.  When we got married and joined our incomes, we made the best decision ever.  We knew that once we started a family, we would move to a one income situation, so that I could stay home and raise our children and eventually homeschool.  So from the time we got married and had 2 incomes, we purposefully decided to live as if we only had my husband's income.  My income went directly into savings and was never considered available for spending.  This was the greatest decision ever and would be my best money advice to newlyweds.

You can check out my other debt free posts Here

So we bought our home in October of 2013.  We had a 6 month old baby.  This 1890's poor farmhouse needed work.  The stairs were too steep, and the 2nd floor ceilings were too short.  We paid to have contractors put in L-configured stairs and vault the ceilings for the master bedroom, hallway and bathroom (we left the kids bedrooms with low ceilings).  We paid cash for that work, thanks to my saved income for those couple of years of being married-no children.  Over the years we have continued to work on our house and do many projects.  

Over the course of the past 7 years, we have taken different approaches to paying on our mortgage.  In the beginning, we didn't pay anything extra towards the principal simply because we had spent so much on the renovations and down payment.  But after a couple years we started paying about $100 extra towards the principal each month.  In 2015, after our 2nd child was born, the interest rates were very low, so we decided to refinance the mortgage down to a lower interest rate and a 15 year loan from 30 years.  I think we got 2.75% down from 4.6% or more (I cannot remember).  And at that point we were only 2 years into our 30 year mortgage.  So it seemed worth it to do, since we didn't plan to pay the mortgage off anytime in the near future.  The amazing part about our refinance, was that our monthly payment only went up about $100/month.  We continued to plug away and chip that mortgage down.  Then in 2017, our savings had built up, so it seemed wise to pay down some more of our principal in a chunk.  That felt really good, so we upped our monthly extra principal payment to $500. Watching the principal go down more quickly was very cool, but we still had a long way to go.  In 2018, we decided to pull back our extra contributions completely.  We had some plans for the following year, and decided we needed to save the money to have cash available for those plans.  In December of 2018, I found out I was pregnant, not planned!~  Very exciting, however that threw a wrench in our 2019 plans.  Our plans and lives got flipped upside down for a bit, and we had to re-evaluate.  We decided that our 2019 plans needed to be deferred year.  The Laird wondered if we buckled down, would it be possible to pay off our mortgage completely within the next year (2019).  I did the math.  It was going to be very tight, and we would have to utilize much of the money we'd saved up the previous year, but we could probably do it in about 15 months (March of 2020).  So we ventured into this gazelle intense debt paydown of about $75k-$80k left on our mortgage in that next 15 months.  

AND WE DID IT!  In December of 2019, we were on track for payoff in March 2020.  We had money saved up in other areas.  So I got a little pay crazy and ended up borrowing some money from our emergency and car funds (with intentions of paying the newly freed up money from no mortgage back to those funds), and paid the mortgage off on December 21, 2019!!!

So now we have been mortgage free for 4 months and it's pretty amazing.  Our money comes in and goes directly into savings funds, while our monthly expenses have been decreased dramatically.  We now have to save money each month in order to cover our property/school taxes twice a year.  So much of what was used to pay our mortgage now goes into a fund to pay property taxes and fund improvements and repairs.

So that's our short/long story of becoming Debt Free/ Mortgage Free.  We do still have a 3 family rental property that we have owned for 9 years, which still has a mortgage.  But other than that, we don't owe anyone any money.  It's time to follow the age old tradition of getting a new front door and painting it red.

Accomplishing this huge goal, opens up so many doors for future endeavors.  We are free of being slave to the lender any longer!  Doesn't that sound amazing?  If this inspires you at all, I encourage you to check Dave Ramsey out.  Work the 7 Baby Steps- they are so straightforward.   It may take some retraining and building new habits.  It may be hard.  But doing hard things is worth it.  Because when you live like no one else today, you get to live like no one else tomorrow!  

Debt Free Journey- 3 months in

A few months ago, I posted about the dream I have had about being completely Debt Free.  At this point, we are on Dave Ramsey's Baby Step 6: Pay the House Off Early.  Earlier this year we decided to take things seriously and have been living by a tight budget and putting everything extra into payments toward the principal of our home.  

Here's our Mortgage Pay Off chart, which is a fun reminder that hangs in the corner of my kitchen.  I get to color a line in every time we hit a milestone of $4k paid down on the principal of our mortgage.  


Our journey has been encouraging so far.  It's amazing how much money we were just letting slip through the cracks, simply because we weren't driven towards a specific goal.  We have always been good at saving money, but in recent years we got relaxed with our spending.  This became especially inflated when we purchased an old house that needed work done.  And with an old house in need of renovations, we found ourselves spending more money than was typical for us.  Five and a half acres of land, meant we needed a riding lawn mower.  Major renovations on the inside of our house just to make it livable.  Etc...  So after meeting a few savings goals, I proposed the reality that we could start paying a larger amount towards the principal each month.  After we refinanced our mortgage last fall (to an unbelievably low rate of 2.75%), we started adding an extra $100 to the mortgage principal each month.  The $100 was hardly noticed by us, and after a year would equal about 1 mortgage payment extra per year.  We then upped that extra monthly payment and by my original plan we should be paid off by March of 2023.  But paying off debt is a little addicting for me, and we have done unbelievably well the past 3 months with beating our budget (not spending as much as we allotted in each budget category).  We also applied our tax refund to our principal for the month of May.  So the past couple months has been encouraging to say the least in terms of watching the principal melt down more than my original goal.  So the original goal of March 2023 is a basis, but I hope to beat that down sooner than later.  

If you're following and bringing discipline to your financial health, I commend you and wish you the best as you strive towards your own personal goals!  It's totally worth it.  And as Dave Ramsey says... "Live like no one today, so that you can live like no one tomorrow".  I discovered a place on his website that has testimonials of real people doing the "Debt Free Scream" after they finally reached their goal of freedom.  It shares how much debt they paid off, the amount of time it took and the income they were earning to reach their goal.  Such inspiring stories to listen to.  It makes me long to be in their shoes and wish it were 6 years from now (I am hoping more like 3 years from now), so I could be sharing in the victory of debt freedom.  And soon enough, I know we will be there.  But it can't come soon enough!

Stats of Redwoodshire Mortgage Pay Off-
Purchased Redwoodshire October 2013
Jan. 2016 --->started paying extra $100 each month to principal
Sept. 2016---> refinanced mortgage to 2.75% @ 14% paid off  
Jan. 2017---> mortgage principal balance @ 16.7% paid off
May 2017---> remaining mortgage @ 22.7% paid off
goal by the end of December 2017----->  Be 33.3% paid off 

We are on our way!

"I've Got A Dream"

Rapunzel: [after releasing a branch that hits Hook Hand Thug on the head] PUT HIM DOWN (Flynn Rider)! [Everyone stops and stares at her in disbelief] Okay, I don't know where I am and I need him to take me to see the lanterns because I've been dreaming about them my entire life! FIND YOUR HUMANITY! Haven't any of you ever had a dream?!

Rapunzel has a dream.  To see the lanterns of the Festival of Lights that appear in the sky every year on her birthday.  What a magical experience!  I would love to see something like this in my lifetime too.  I think about this scene often, as Rapunzel belts this song out amidst a bunch of thugs in a tavern, who want to capture Flynn Rider.  She distracts them with questioning what dreams they have ever had.  After inspiring each one to consider their dreams they are then free to go. 

I have lots of dreams, but the one dream that has taken a center stage this year is the dream to attain complete financial freedom.  Ever since I graduated from college and was given a copy of The Total Money Makeover by Dave Ramsey (from my mom), I have always dreamed of attaining this sort of freedom.  Inspired by what I read, the principles took deep root in my heart and I started living them out.  I was able to pay off $21,000 of school debt within 18 months of graduating college, while only working part time in my field! I was absolutely determined and I reached my goal.  I have been working the Baby Steps ever since then. In addition to paying off the debt, we've purchased every vehicle we've owned with cash.  Our only remaining debt consists of the properties that we own.

These Baby Steps have served me well.  They have given me direction and wisdom of what to focus on in order to gain financial stability.  Thankfully I married someone who was raised with a good financial head on his shoulders, and whose family prepared him well for financial success.  At this point, we are working on Step 6- Paying off Our Home Early.  

This is my Dream!  I dream of not having a monthly mortgage to pay.  Imagine not having a housing expense line in the monthly budget?!  More and more I am imaging what an amazing thing this would be. Sure, there are lots of things I would love to do.  I love to travel.  I love to work on renovation projects at Redwoodshire.  And all those things can still happen, if we are wise about our resources.  

Recently I have been evaluating our budget, which is actually more of a "Spending Tracker" than an actual budget we live by.  We used to be really good at saving money- that was before we purchased our old 1890's farmhouse with 5.5 acres of land.  Things all changed in 2013 when we moved here to Redwoodshire.  We needed to make some renovations to the house to make it more livable.  And once the money started flowing out... it just kept going out.  We have been doing projects and starting hobbies since then and haven't gotten out of the "Spending mode".  With land, we needed a riding mower... and then a wood splitter... and then a snow blower... and the dining room needed to be renovated... and then it was a chicken coop & a beehive..... on and on and on.  We plan to live here for the long run, so spending money on needed things did not seem like such a big deal, as they are more of an investment than an unnecessary expenditure.  

This time last year, I revisited my goal of eventually paying our home off.  I got the Laird to agree to putting a chunk of money available savings into the mortgage, and that felt great.  But it sort of just increased the itch inside of me to keep paying things down.  But then we decided to build a chicken coop and buy a beehive, and the itch faded for a while.  Last summer I noticed that mortgage interest rates were at an unbelievable all time low.  We discussed possibly re-financing the mortgage and decided this was a good move, considering our mortgage was in the mid-4% range.  Not bad, but rates were hovering around 3% at the time.  We ran the numbers for both the 30 and 15 year mortgages, and realized it was only going to cost about $100/month more for us to refinance down to a 15 year mortgage, which then allowed us a slightly lower interest rate.  AMAZING!  So we did it!  Original closing was October 2013, with a 30 year mortgage.  With 3 years paid off of that 30 year loan (27 to go), we refinanced down to a 15 year mortgage.  So with that move, we saved ourselves 17 years of mortgage payments.  Can't beat that!

After reaching some financial goals we had before us, I started looking at the numbers and running them through amortization calculators again.  With what it seemed like we could pay extra per month, I calculated that we could pay the remaining $127k on our mortgage by March of 2023.  That's 6 years from now.  Essentially that means paying off our new 15 year mortgage in a total of about 6 1/2 years.  Seriously!?!  This was all a hypothetical IF we could actually pay as much as I thought extra each month.  I shared my new goal with the Laird, and painted the picture of having our house paid off by 2023, and after a weekend of mulling it over, he seemed sold on the goal.  Once we looked at our budget, it appeared like the reality of this payment would be a lot more difficult that I had initially perceived.  And why wouldn't it?  It's like paying off a huge debt in lighting speed!  It's living like no one else today, so that you can live like no one else tomorrow.  Isn't completely DEBT FREE worth the sacrifices right now?  I believe it is.  So this past month we declared as "Frugal February".  We have really become aware of our spending, and have tried our best not to make unnecessary purchases.  The Laird has been amazing and has chosen to eat lunch at home or pack lunch so far all month.  I have been tempted, but resisted buying for the sake of buying.  We have cut back and have literally cut our expenses down dramatically.  Unlike most months, I look forward to itemizing all the expenses and inputting them into our budget to see how well we did this month.  There are so many fewer transactions, so it will take me a fraction of the time.  Not to mention the inspiration of what we're capable of when we really try to save for a greater purpose.  

So we're 23 days into February.  With only 5 days left of this short month, I asked myself how life has changed with spending less.  Has my quality of life diminished because I haven't made random shopping trips for things that we "need", but may not really need?  Has it been intolerable that I haven't stopped to McDonald's for a Mocha Frappe (my weakness, and source to make it through the sometimes long days of being a stay-at-home-mom)?  Has it been hard not eating out?  The answer is NO!  Life has felt so much simpler.  Less stuff.  More contentment.  Connection to gratitude for what we have.  Clarity of mind to know that WE WILL reach financial freedom in the near future.  Gratitude that we have the ability to pay extra on this huge debt.  Gratitude for the vision of something greater.  It's SO WORTH it.  

I got the "mortgage payoff chart" that I started last year back out and was able to color in one line of the picture.  We still have so far to go, but I now know that we're focused and we're going to be coloring in more lines of that chart every couple of months now, rather than one line each year.  On March 1st we will make our 2nd extra payment toward the "principle only".  Yay!  Let's hope that we can figure out a way to keep motivated toward making the little sacrifices that will be necessary for us to be able to continue making the largest extra payments that we are able.  That March of 2023 date needs to be our bottom line.... I would love to see that date move up closer and closer.  That may be a little overboard, but one can dream, right?!

DO YOU HAVE A DREAM?  Let yourself DREAM BIG about things that seem unreachable- because you just may be able to reach them.

Matters of Money

After college my mother shared with me about Dave Ramsey and his principles the "Seven Baby Steps".  She was very enthusiastic about the baby steps and really worked to influence me to read his book, "The Total Money Makeover".  I did, and from that point on I was sold on a more directed path to financial freedom.

Having just graduated from college, and working part time in my field, I was making more money than I had ever known before.  I hurried to consolidate my loans, which meant that I missed on the 6 month period of deferred interest.  Then I made it my goal to pay my loans off as fast as I could.  I saved up my $1000 Emergency Fund, and started putting every bit of extra income towards my loan payments.  With just over $20,000 of school loans, I was completely payed off within 18 months!  Part of this time I was only working part time!  It became somewhat of a game to me to pay extra on the principle each month and watch the total go down.

Me & "Marley" , the 1969 VW Beetle in 2005

Honestly I enjoyed paying off my school loans.  Once I was paid off, I actually missed having a goal to pay down.  At that point, I had disposable income that wasn't accounted for.  I would save, but as soon as I reached about $5000 I would find something silly to spend money on.  One time I bought a beautiful 1969 Volkswagon Beetle from Northern California, off of ebay!  Keep in mind, I was living in Western New York when I made this purchase.  I had to pay a good chunk of money to have the car shipped across the country.  I affectionately called it Marley, because I really loved listening to Bob Marley at the time.  At the time, I had become a new home owner.  So I now had a mortgage to work to pay off.  I printed up the amortization table and every time I made an extra payment towards the principle, I would cross off future monthly payments.  If you've ever owned a house and looked at the breakdown of your mortgage payment, you know that in the beginning only a very small portion actually goes to paying down your loan.  I realized that if I only could simply match the amount payed towards principle for that month, then I would decrease the life of my loan by a whole month!  If I did that every month for a whole year, I could more or less decrease my 30 year loan by a whole year!  And as more of the loan is paid down, the impact is even greater.

I LOVE Dave Ramsey's 7 Baby Steps!  And they have worked for me.  For more information, check out Dave Ramsey's 7 Baby Steps.

With some financial freedom goals for our family brewing in my mind,  I found some great debt freedom charts . Most people accept the fact that they will probably always live in a state of debt.  This is an absolute lie.  There is light at the end of the tunnel, but as Dave Ramsey says:

Can you imagine living mortgage free?  That would be amazing financial freedom in my mind.  It's time to set some BIG GOALS for the near future.  With charts like this one hanging on the wall or refrigerator, our goals are visible every day.  Saying "No" to eating out, or using that really good coupon to buy something that we may not "need", means gaining something we really do need- Financial Freedom.                        Check out these DEBT FREEDOM CHARTS.