Guest post by Brandy at Team Chandler
Thanks to Crystal’s post about paying 100% down on their home I was encouraged to participate in Dave Ramsey’s Financial Peace University. The idea of owning my own home in my 30’s seemed like a foreign idea — something that just couldn’t be done.
At the same time, I began reading couponing blogs at night while I stayed up with our newborn to learn about how to save money. And, it all made sense to me! I was literally wasting money on things that had a temporary value rather than investing long term in my home and in the lives of my children. Quickly that “value meal” or that nice outfit didn’t hold as much value as assigning those dollars to the principal on my home.
You see my goal is to pay off my home so that I can work less and spend more time with my children. The idea of being able to focus solely on the role of a true “stay-at-home” mom is exciting, but to do this we have to set our mind right and be good stewards of the money the Lord has given us.
Around June of 2010, we started to make some drastic changes. We had already started Financial Peace University, and it was time for change! We began implementing some strategies:
1. Search for a better deal on home mortgages.
At the time we had a 30 year mortgage at 5.875%. I had been casually watching the rates, but as they dipped, I started calling around. I was able to get a 15-year mortgage at 3.875%. This change alone saved us $30-40,000 in interest from decreasing the years.
2. Make changes in our spending habits.
We really wanted to scale back our spending and throw any extra money at the end of the month at our mortgage. Once our cable/landline contract was up, we cut that expense completely. This saved us about $100/month at the time not including the increase we were fixing to have once the promotion ended.
3. Increase our coupon strategies.
I was already seeing good savings from my couponing and tried to be disciplined in this area. My savings at first were $500-1,000 a month. Once I had my stockpile in place, I was able to drastically reduce our grocery bill.
4. Keep records of our budget.
I used a spreadsheet to track every penny that comes in and out of our house. At the end of the month, I literally total them up and we make an extra “principal” payment toward our house.
5. Change from credit cards to cash.
I had been sold on the idea of using my card to earn points to pay down my mortgage. After listening to FPU, I realized that I was probably spending more as I was earning those points than if I would just set aside $20-25 a month to send in as an extra payment to principal.
It has been about six months since we started to actively make additional payments towards principal. And, I am amazed at the results! In the 8 years of our 30-year loan, we had only paid off 14% of the principal. Only 14%!
In the last 6 months, we have been blessed to pay off 6% of the original mortgage amount. It may not sound like a lot, but compared to only paying off 14% in 8 years, I am ecstatic!
Brandy is a working mom of two. She enjoys spending time with her family, couponing, running, writing, and homeschooling. She also enjoys documenting their life’s adventures at Team Chandler.
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