oped
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Post by oped on Jul 25, 2020 12:00:35 GMT -5
Oops late with that last post, but still might help frame it better in your head.
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Post by Deleted on Jul 25, 2020 15:46:37 GMT -5
The thing that is killing me are those damn closing costs. I'm not going to do it because it defeats what I'm trying to do, but I understand why Phil says borrow as much as you can. If the closing costs are $2700, that's an additional 2.75% on the cost of the loan. That's really mentally tripping me up right now. How much did you Roth make last year? The decade before? How does that compare with closing costs? But, that's why I'd rather put the money in my Roth than closing costs!
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oped
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Post by oped on Jul 25, 2020 15:56:18 GMT -5
How much did you Roth make last year? The decade before? How does that compare with closing costs? But, that's why I'd rather put the money in my Roth than closing costs! I was thinking using your Roth to pay off the house... a 30 year means maybe you get to keep adding to your Roth
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minnesotapaintlady
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Post by minnesotapaintlady on Dec 12, 2020 12:11:51 GMT -5
Bumping this because I FINALLY closed on the refinance mid-October! There were no issues, they were just heavily backlogged. With the December payment the $1800 closing costs are paid off and I'm back to what I owed in August...I really hated seeing the number jump up, so that was a relief. New PI payment is $383/month. I've paid off 10 months of the loan in the past 2 but I'm waffling on what to do for the next 2 years while dealing with FAFSA. Part of me wants to just take that time off from the extra payments while 60% of my gross is going into retirement accounts, but I'm afraid if I do I won't start back up again.
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Lizard Queen
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Post by Lizard Queen on Dec 12, 2020 13:48:09 GMT -5
My opinion is that you've worked really hard to get where you are, and your financial discipline is superb. Take it easy on yourself. Maybe you can find a compromise amount that eases the budget, yet still cuts off an acceptable amount of time on the new mortgage.
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CCL
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Post by CCL on Dec 13, 2020 6:20:22 GMT -5
Agree with Lizard Queen. You've done an excellent job managing your finances (and raising your boys!). Maybe it's time to be a little easier on yourself?
Even if you only pay your regular payment you will still be paying it down. I don't always agree with Phil, but I do think the extra in your retirement accounts will accumulate faster than paying extra on the mortgage will lower the balance. Your mortgage balance will be dropping and your equity will be building, anyway, without putting additional $$$ into it.
I'm also refinancing my house. I can't resist a rate under 3%. My first mortgage was 11% lol, hard to imagine paying that now. I'm getting charged closing costs, too, and I'm going to roll them into the new loan. I figure in the long run $2000 really won't matter. The estimated closing costs they sent me say they will owe me $1400 at closing. $500 of the difference is for the appraisal which my loan officer now says they will let me skip. I'm not too sure they will actually give me cash, but, if not, my loan will be for a lesser amount. I'll end up skipping one payment, so might send that amount toward the new principle and will bring the balance down, anyway.
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debthaven
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Post by debthaven on Dec 13, 2020 7:19:46 GMT -5
I owe about 95K now and my payment is $1300 with a little under 7 years left.New PI payment is $383/month.I'm not sure if these numbers are comparable (PI vs PITI) but I agree with Lizard ... find a happy compromise and go easier on yourself. Good to see you back!!!
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minnesotapaintlady
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Post by minnesotapaintlady on Dec 13, 2020 10:46:54 GMT -5
I owe about 95K now and my payment is $1300 with a little under 7 years left.New PI payment is $383/month.I'm not sure if these numbers are comparable (PI vs PITI) but I agree with Lizard ... find a happy compromise and go easier on yourself. Good to see you back!!! They are both just PI. Well, the one is actually $1277, but I had always rounded the payment up.
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minnesotapaintlady
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Post by minnesotapaintlady on Dec 13, 2020 11:47:04 GMT -5
Even if you only pay your regular payment you will still be paying it down. I don't always agree with Phil, but I do think the extra in your retirement accounts will accumulate faster than paying extra on the mortgage will lower the balance. Your mortgage balance will be dropping and your equity will be building, anyway, without putting additional $$$ into it. There's $6500 more tax-preferred space if I use the catch-up in my 401K, but man...I just don't know if I want to put more in retirement. The last few years I've been maxing my 401K regular contribution and my Roth and this year I maxed the HSA too.
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countrygirl2
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Post by countrygirl2 on Dec 13, 2020 19:17:57 GMT -5
Didn't you say something before about needing a vehicle? Maybe you should do that, to make sure you have a reliable one.
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minnesotapaintlady
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Post by minnesotapaintlady on Dec 13, 2020 19:31:03 GMT -5
I think my van is ok for a couple more years. I got rid of the old one, so just have the 2007 now.
But really, I don't HAVE an extra $900 month. Remember the entire reason I refinanced to lower my payment was because I lost $1000/month in child support.
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debthaven
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Post by debthaven on Dec 14, 2020 15:25:10 GMT -5
I wondered about that, but I couldn't remember what your CS was.
Then just "set it and forget it" for now.
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Rukh O'Rorke
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Post by Rukh O'Rorke on Dec 14, 2020 16:45:43 GMT -5
I think my van is ok for a couple more years. I got rid of the old one, so just have the 2007 now. But really, I don't HAVE an extra $900 month. Remember the entire reason I refinanced to lower my payment was because I lost $1000/month in child support. how is the monthly budget looking now? I know you were locked into high 401k for college financing, and had a large savings for when the CS stopped... Is the budget good now?
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minnesotapaintlady
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Post by minnesotapaintlady on Dec 14, 2020 17:01:29 GMT -5
I think my van is ok for a couple more years. I got rid of the old one, so just have the 2007 now. But really, I don't HAVE an extra $900 month. Remember the entire reason I refinanced to lower my payment was because I lost $1000/month in child support. how is the monthly budget looking now? I know you were locked into high 401k for college financing, and had a large savings for when the CS stopped... Is the budget good now? Well. It's only been since July, but I haven't had to tap the savings yet. However, I'm a month ahead in my budgeting, so August was covered, then September I was refunded $1300 from the scout trip DS was supposed to take that was cancelled. October was a skipped mortgage payment due to the refinance, and come November I maxed the 401K already and was getting huge checks (comparatively speaking). Things will get ugly again come February (since I'll fill Jan budget with December money). I haven't put it in a spreadsheet yet to see what it looks like, but I suspect I could have a functional budget that didn't tap savings if I only made the $383 payment.
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Rukh O'Rorke
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Post by Rukh O'Rorke on Dec 14, 2020 17:37:48 GMT -5
that's awesome MPL! And you are maxing your 401k while you do it! So you are still in the running to become Americas next financially independent single mother.
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minnesotapaintlady
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Post by minnesotapaintlady on Sept 15, 2022 7:45:06 GMT -5
Bumping this thread just to say; I MADE IT!
And with all the savings meant to carry me still intact! (although I do have a little debt to payoff by December). My 401K maxed out with the 9/2 paycheck and it's all smooth sailing until February...at which point it depends what I decide to do as far as 2023 contributions starting in January. I don't have to max everything anymore (at least not for the next 3 years), but I'm kind of liking what it does for me tax-wise. Still putting 13% in my catch-up contribution to max out that by year end, but that will seem like nothing. The refinanced mortgage I have been paying a little extra on (like $114/month) and it's down to $77,500. I probably should delete the column in my amortization spreadsheet showing what it would be at with the old payment plan because that's a little depressing, but I officially have more in Roth contributions than outstanding mortgage balance now by $200! I'm finally where I could pay it off tomorrow if I wanted which is a huge load off.
Of course, just because I like constant financial challenge, I planned a trip to celebrate and need to come up with 8-10K by March.
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Post by Deleted on Sept 15, 2022 8:21:17 GMT -5
Congratulations, MPL! You're a wonderful example of planning and discipline. I'm sure plenty of custodial parents in your situation would just wait till the CS ends and then cry about their reduced income.
Enjoy the trip. Where are you planning to go?
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minnesotapaintlady
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Post by minnesotapaintlady on Sept 15, 2022 8:34:01 GMT -5
Enjoy the trip. Where are you planning to go? Alaskan cruise with the kids. Took them in 2017 but the youngest was just 7 then and barely remembers. A bunch of family is getting together to do it again and the boys both want to go, so what the hell...why not? No sense saving every dime.
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Post by Deleted on Sept 15, 2022 8:57:29 GMT -5
Enjoy the trip. Where are you planning to go? Alaskan cruise with the kids. Took them in 2017 but the youngest was just 7 then and barely remembers. A bunch of family is getting together to do it again and the boys both want to go, so what the hell...why not? No sense saving every dime. Totally agreed. I'm pretty conservative on most of my expenses but travel is a HUGE priority. And Alaska is beautiful!
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anciana
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Post by anciana on Sept 15, 2022 9:06:32 GMT -5
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minnesotapaintlady
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Post by minnesotapaintlady on Sept 15, 2022 9:23:27 GMT -5
The last few months were rough because I got a little cocky and locked up all my cash in I bonds the last year. 10K of that became available back in April, but...9.62%...I couldn't bring myself to cash any of it in! I was selling stuff, taking 0% loans and digging in the couch cushions for cash instead.
I just got the paystub for tomorrow's check with no 401K and I feel so flush with money.
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skeeter
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Post by skeeter on Sept 15, 2022 9:45:51 GMT -5
The last few months were rough because I got a little cocky and locked up all my cash in I bonds the last year. 10K of that became available back in April, but...9.62%...I couldn't bring myself to cash any of it in! I was selling stuff, taking 0% loans and digging in the couch cushions for cash instead.
I just got the paystub for tomorrow's check with no 401K and I feel so flush with money. Please take some time to actually enjoy this feeling.
You have worked so hard for so long to get to this point, you deserve some peace of mind and happiness.
I've always admired your financial wisdom, whether it be taxes, Roths, investments, etc., etc. You are one amazing lady!
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minnesotapaintlady
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Post by minnesotapaintlady on Sept 15, 2022 12:02:16 GMT -5
The last few months were rough because I got a little cocky and locked up all my cash in I bonds the last year. 10K of that became available back in April, but...9.62%...I couldn't bring myself to cash any of it in! I was selling stuff, taking 0% loans and digging in the couch cushions for cash instead.
I just got the paystub for tomorrow's check with no 401K and I feel so flush with money. Please take some time to actually enjoy this feeling.
You have worked so hard for so long to get to this point, you deserve some peace of mind and happiness.
I've always admired your financial wisdom, whether it be taxes, Roths, investments, etc., etc. You are one amazing lady!
The hard part is going to be figuring out what I'm going to do starting next year. Keep doing what I was doing out of habit after 5 years? Take the exact opposite approach and live it up and just set retirement to 15% and call it good? Find more of a happy medium? I don't know. Kind of lost now.
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giramomma
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Post by giramomma on Sept 15, 2022 16:02:09 GMT -5
You are amazing.
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debthaven
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Post by debthaven on Sept 15, 2022 18:55:16 GMT -5
You are indeed AMAZING minnesotapaintlady !!! I would DEFINITELY go with a happy medium!!! You don't have all that many years left during which your boys will be willing/available/happy to travel with you ... so personally I'd focus on that. You also said: I probably should delete the column in my amortization spreadsheet showing what it would be at with the old payment plan because that's a little depressing.I'm curious what your mortgage would have been now without that refinance ... I'm guessing it's not a huge difference! Why not split the difference?! Half (or part) to "fun" and half (or part) to paying down your mortgage. (I know prepaying the mortgage may not be the best use of your money but I also know it's important to you, which I get! There's nothing like living in a paid-off house!) I'm also wondering ... did your Mom ever come up with the goods?! Feel free to ignore that question LOL. You done good!!! You have SO MUCH to be proud of!
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skeeter
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Post by skeeter on Sept 15, 2022 19:55:27 GMT -5
Agree with debthaven 100% in going the happy medium route. Enjoy some of the fruits of your labor now and save some for your mental health well being by feeling more secure financially. You have worked so hard, planned for retirement for so long and at the same time made sure your sons were well taken care of. You have reached what I call "the best of both worlds" time of life.
Just my nickel's worth (increased from 2 cents due to inflation).
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minnesotapaintlady
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Post by minnesotapaintlady on Sept 15, 2022 20:08:53 GMT -5
65K vs 77K. I'm actually not interested in pre-paying anymore now that I could just pay it off. Super weird shift in mindset once that happened. I do still want it gone before I retire, but thinking more lump sum at that time. She did give me the 16K Fall of 2020, so I had about 28K stuck aside in the EF. Now that's about 36K. However, I wiped out all sinking funds. Like COMPLETELY wiped out. I totaled my van last year and spent 10K on a replacement and still took the kids on road trips the past couple years with no real vacation savings. Besides some credit card churning for sign on bonuses and points to cover hotel costs, I just kept stealing from every category that had money in it until they were all dried up.
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debthaven
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Post by debthaven on Sept 15, 2022 20:19:34 GMT -5
I'm actually not interested in pre-paying anymore now that I could just pay it off. Super weird shift in mindset once that happened.
That's really interesting! I figured it would probably be about a 10K difference (ball park). So I would have suggested taking 10K out of savings to get you to the same point you would have been before refinancing.
But if you're happy with the status quo, obviously that's a better use of your money!
Again, kudos to you!
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debthaven
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Post by debthaven on Sept 15, 2022 20:22:34 GMT -5
Last thought ... if you had to take your ideal trip, where would YOU like to go? I know you do road trips, I know you are going back to Alaska because your family is going and your kids want to go.
But if YOU could choose a place to go, and take your kids along, where would YOU most like to go?!
Maybe that's something to consider ... you deserve to do something for YOU, for once.
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Rukh O'Rorke
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Post by Rukh O'Rorke on Sept 16, 2022 1:10:29 GMT -5
Kudos MPL! glad this worked out and you got yourself to a good spot and outlook.
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