January Mortgage Update: And the amazingness of making more money than you ever have before

Last month (December):
Balance: $67,886.81
Years left: 5.333333333
P =$929.45, I = $284.95, Escrow = 613.58

This month (January):
Balance: $65,769.13
Years left: 5.16666667
P =$945.68, I = $268.72, Escrow = 613.58

One month’s prepayment savings: $4.64

Man, look how low that mortgage is getting.  Still 5 years out if we just pay the required amount, but if we keep up the prepayments, it’ll be half that time or less.  But we’ll see what happens.  (Especially if we keep spaying/neutering/testing/vaccinating cats at $300/pop.)

Anyhow… it is SO nice having more money than you need.  The lack of needing to think about money is just amazing.  A huge stress is gone now that DH is working again and the mental load is also gone.

There’s still a lot of stuff that we don’t do, but just knowing that we could do it is relaxing.  One of these days we’ll hire someone to mow the lawn.  We could totally hire someone to clean if we wanted to.  If things don’t work out in one way or another, we can throw money at the problems again.  Even if those problems never actually happen, the possibility of them happening is stressful when money is tight.  You can just forget about a potential problem until it happens when you have enough money to solve it.

This is not to say that you should spend your entire paycheck each month.  Our baseline expenses are still set from my paycheck alone.  We still have pretty frugal habits, even at the grocery store.  DH still has his allowance for his fun stuff.  We’re still limited by time.  We’re automatically saving as much, if not more, than ever.

And at some point with additional spending, it isn’t the additional lattes that get you (DH is thinking of re-upping his TONX subscription rather than continuing to roast his own from Sweet Maria’s).  It’s the big stuff.  The housing.  Replacing fancy cars.  My colleagues have traded up their “starter house” for enormous mansions or estates, sometimes building it themselves.  Then they complain about money being tight and have to take on more consulting.  It takes more lattes than a person can drink to make up for an additional 200K or 300K in debt on a house.

We have no intention of buying a fancier bigger house, and hopefully our cars still have a lot of wear in them.  And when we do replace them it’ll be with something at the level of a Civic Hybrid at the fanciest.  No BMW in this family.  So another $300 to neuter, vaccinate, and deworm yet another kitty isn’t worth thinking about.  We can spay/neuter several kitties a month and still be ok now that DH is working again, even if it means slower mortgage payoff or less money to a different charity.

Don’t worry, by next month we’ll probably be used to earning this amount, even though we never did get used to living on only half this amount, and we’ll stop talking about it.  It’s a lot easier to get used to having too much money than it is to get used to having just enough.  And, of course, one never gets used to having not enough.

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45 Responses to “January Mortgage Update: And the amazingness of making more money than you ever have before”

  1. plantingourpennies Says:

    And that’s pretty much exactly how we felt when we went from Mr PoP earning minimum wage to $80-$100K/year. We didn’t make drastic changes to the baseline spending, but not having to stress if an expense that was a few hundred dollars came up was a huge luxury. (Still kindof is, though three years later we have adjusted a good bit.)

    Re coffee – Mr PoP tried ordering from Sweet Maria’s but was dissatisfied with their beans. He now buys his whole beans from Starbucks (“not the best, but they’re consistent so you don’t need to recalibrate constantly”). What does DH enjoy about TONX?

    • nicoleandmaggie Says:

      Dh really likes sweet Maria’s — he gets the raw beans and roasts his own, but no longer has time to do that.

      I can tell you what he doesn’t like about tonx– he likes doing half caf, and it is a pain to get them to alternate caf/decaf. So he’s thinking about just getting decaf (because it is harder to get decaf here) but that’s probably too much decaf, and their decaf isn’t as good as their caf on average.

      • nicoleandmaggie Says:

        Your DH probably wouldn’t like TONX because it’s something different each time– all roasted to perfection, but if he needs exactly the same amount of robustness, it may not work for him. And if he needs the exact same flavor it definitely won’t work for him.

  2. Holly@ClubThrifty Says:

    That is pretty much how I felt when Greg went back to work this fall as well. We don’t necessarily need the extra money but it’s a HUGE relief to know it’s there. I like being a two-income family =)

  3. bogart Says:

    I think this is exactly right, and that it’s something most PF bloggers gloss over hugely. Figuring out (or adopting) new ways to cut back on expenses has NEVER had nearly the effect on my financial well-being or sense of peace as bringing in more money has. Particularly much more money.

    • nicoleandmaggie Says:

      MMM in particular doesn’t seem to realize there’s a big difference between playing at frugality when you have a solid income and lots of savings and actually having to live frugally. Even if you spend the same 23K/year, there’s a huge difference in peace of mind. (Especially when he talks about how you don’t need insurance etc.)

      And yeah, it’s hard to get the same bang for the buck in cutting expenses that you do in more than doubling your income. Like some pf bloggers note, there’s potential for infinite upside [disclaimer: most people won't be able to hit the 1% because of structural inequities], but you can only cut back to zero.

      Of course, there’s infinite upside to spending too, but you tend to have to buy bigger and often ridiculous things (which people DO) or be very generous to charity.

      • Liz Says:

        This. Yes. “There’s a big difference between playing at frugality when you have a solid income and lots of savings and actually having to live frugally.”

      • Leigh Says:

        THIS. I get SO much peace of mind from having excess cash flow.

  4. Leigh Says:

    Isn’t it so wonderful?

    P.S. I love watching your mortgage go down every month!

  5. Debbie M Says:

    Eh, you can keep taking about it. Grown ups don’t get excited about things as much as they should.

  6. OMDG Says:

    Man, I’m surprised you don’t get more “hate” comments. ;-)

    But more seriously, good for you guys! And I totally endorse not overbuying on the house. Though damn if houses in good public school districts don’t cost a freaking arm and a leg in my part of the country. And of course, so does private school. I was actually wondering whether you had thoughts on that — i.e. buying a more expensive house in a good school district vs. shelling out for private school but having a less expensive house.

    You’re making me yearn for the day when I will finally be done with my training. Someday, in the not horribly distant future….

    • nicoleandmaggie Says:

      People who hate successful career women either stopped reading or became converts a while back. :)

      And really, it isn’t so unusual for a family’s income to be cut by 40% when one member loses a job and to double when that person gets a new job (with a raise!) And housing is pretty cheap here and we’ve had our (inexpensive and mid-level) cars for many years (and plan to keep them many years longer), so it’s not like we’re spending luxury money. If we were living in the SF bay area right now all things equal we’d still be renting. But it is nice making more money than we’ve ever made before!

      I think the answer to the public vs. private school question has to be answered on an individual basis.

      Our DC1 is a special snowflake and the publics wouldn’t even talk with us when ze was 4 (though they would have if we’d lived a town over in the worse schools town), so we went private. Also we bought into a good district and they @#$#@ing changed the elementary zone a few years later, causing our property values to plummet. We’ve got some blog posts somewhere with more details on our specific situation.

  7. Dame Eleanor Hull Says:

    Is there no cheap clinic in your area that will neuter and vaccinate ferals for a reduced amount? Or do you feel that since you can pay the going rate, you ought to do so in order to counterbalance the people taking the cheap rate? I think the Anti-Cruelty society both runs clinics and could help you find one, and some vets (like mine) will reduce the fees for ferals. The cheap clinic in my town has limited spots, but will neuter/test/vaccinate for around $60; my vet will do everything at half the usual rate, so around $150. Maybe there are no such options where you are, in which case I’ve discovered yet another reason I like living in a large metropolitan area. Anyway, good luck with the feral situation . . . when it warms up slightly around here, I have to go back to trapping, since a neighbour has seen some cats I haven’t done yet.

    • nicoleandmaggie Says:

      Yes, there are, but it would take 2 weeks to get the vouchers and we’d have to make an appointment to see the vet 2 days in advance. This vet hospital will fit us in the same day that we catch the cat (except weekends). And we can afford it. (There is one the next town over that does reduced costs for ferals, but it’s a drive… the one we’re going to is the closest vet to our house, which means DH can get the cat in before his morning conference call.)

      So mainly we’re going with the convenient option and ignoring price. Also that $300 includes a heck of a lot of deworming. Tapeworms are GROSS. The uncaught mamacat must really be suffering.

      Anyhow, we’ll have a feral kitty update either this week or next. I forget when I scheduled it. So far the two adults we’ve caught have most definitely been strays, not feral.

      • Thisbe Says:

        Here’s a totally off-topic comment about finance and feral cats: Sometimes the difference in price between what you pay for vaccines, surgical sterilization, and deworming at your local clinic and what you pay at a low-cost clinic is because of subsidies (and it probably almost always is, if you get a voucher). But there is an increasing number of what’s called “High Quality High Volume” spay and neuter clinics that charge under $100 for sterilization surgery and there are no subsidies involved – they are funding themselves entirely at that rate. And it’s because they’re just better at it. They achieve economies of scale with materials and infrastructure, their processes are smoother, and their surgeons are far more skilled at those surgeries. (Example: it is not uncommon for a generalist vet to take 30-60 minutes to spay a cat. The HQHV folks spay a cat in six minutes because they are just that good at it – which is not only cheaper in terms of surgeon and anesthesia time, it is also better for the animal because it easier on the body.)

        Anyways my point, inasmuch as I have one, is that it’s interesting that there seems to be something of an inverse relationship between “skill of the surgeon” and “how much you have to pay to have the surgery done” in the case of sterilization surgery.

        Appendix: I don’t know if it makes you feel any better, but dogs and cats are almost never bothered by tapeworm infections – the common tapeworms don’t really cause any disease for them. They just cause humans to be really upset about tapeworm segments crawling out the butt. The roundworms can make them sick though, and it’s still nice all things considered to deworm them to lighten the load.

      • nicoleandmaggie Says:

        The place the next town over is high volume according to one of the no-kill shelter people… but it’s the next town over.

  8. rented life Says:

    Ugh, tapeworms. Two of our cats had that when I was a kid. The other never ate what she caught so she was fine.

    I had one year where we felt that financially secure. We travelled abroad, and down the coast and I saved like mad. I was glad I did because I was laid off shortly after and I had the money to deal with it. I can’t imagine how it would have been if we didn’t have that. And you’re right, it really is the big things that get people. The people we know that are “well off” are the ones who spend their money smartly and don’t do the massive upgrades. They also tend to be the ones that are totally fine hanging out with people like us–who make significantly less–because it *isn’t* about the material good for them. We’ve watched a few others try to “keep up” with our well off friends and end up with a lot of stress and debt.

    • nicoleandmaggie Says:

      I’m always a little astonished when people who are less well-off than we are (read: complain a lot about not having enough money and having too much debt… who knows their actual statistics) do things that we feel like we can’t afford yet as if they’re needs rather than wants. But we’re probably a bit on the conservative/lazy side when it comes to a lot of big spending.

  9. Leah Says:

    I love watching your mortgage go down. So keep it up, and keep being proud of the work you’ve done. Since we have no mortgage, I get to live vicariously through you and remind myself why I’m saving up so much for a someday down payment.

    Also, our exciting money news is that we both maxed out our Roth IRAs for the year! I’ve never done that before.

  10. oil_garlic Says:

    I love having 2 incomes, too. It’s so stressful to live on just one, no matter how much you make,unless you’re really filthy rich.

    • nicoleandmaggie Says:

      Yeah. I think it would be less stressful if we had a passive income stream of at least 100K, give or take. But even then it would matter if that income was from stocks or someplace safer. It’s hard having all your eggs in one basket! I have to say it’s a load off me too not being the sole bread-winner (though perhaps it has made me less ambitious– I have an unfinished post about that).

  11. Alicia @ Financial Diffraction Says:

    I just stumbled over to your blog from evolvingPF. I’m so impressed with your mortgage repayment! I love watching everyones numbers decrease over time.

    I’m also really excited to read another PF blog from academics… I’ll be checking back.

  12. Linda Says:

    I love watching your mortgage go down every month, too! I’m not paying extra on mine at this point. I was able to swing a really good refinancing last year (15 yr mortgage at just over 3%), so I’m in no hurry to pay it off. I want to take advantage of the mortgage deduction since I itemize and have few other deductions.

    I’m in the opposite situation now with my partner. He has been unemployed for months, has no savings left, and just got his last unemployment payment. Over the past six months, he’s contributed very little to the monthly expenses, but since I have a very well paid job and am fairly frugal we are doing OK. I’m not able to save as much as I normally do for non-retirement investing and fun stuff. My big vacation to Scotland last year was planned and paid for before we knew he was losing his job, but I don’t see anything like that happening this year. :-(

    I just paid out lots of $$$ for a new boiler to heat the house since the old one started leaking and couldn’t be fixed. Luckily I had an EF in place for this big expense, but replacing that money will take much longer now that partner is not paying anything towards housing, utilities, or groceries.

    Partner really needs to figure something out NOW because he will be unable to make the next lease payment on his car and that is something I will *not* cover for him. We live in a city with lots of public transit, so if he loses the car he can still get around. I’m bummed about his continued unemployment and how it is impacting us both.

    • nicoleandmaggie Says:

      That is indeed a great interest rate. We never were able to make a refinancing scenario make sense, so we’ve been stuck at this middling rate.

      That really sucks about your partner. I hope he finds something :( What does he do?

  13. Rosa Says:

    Congratulations on all fronts!

    I think it’s important to talk about, because of what you said about the difference between being frugal with a solid income vs. because you have to, but also because this is the reward for all that frugality! It’s hard to convey, among all the routine “we don’t buy expensive cars” and “no i’m okay without marble countertops” the happiness of just not having to worry day to day. That’s the reason to limit pleasures, that’s the reward of getting out of/not taking on debt – happiness and stability.

    • nicoleandmaggie Says:

      Definitely. I see a lot of bloggers who complain about their huge debt and then buy houses they can’t afford with less than 20% down that they remodel right away and then they wonder why they’re always coming up short.

      We did pay our dues–paid dh’s student debt right at a sacrifice, never got into consumer debt, paid cd games with our lumpy stipends to squeeze out every penny. That left us in good shape when we started out. Then we bought a house based on one income instead if two. Minimized our car expenses. Don’t let food go to waste, and all those other daily frugalities. It has seriously paid off in terms of freedom. Even the fact that dh was able to quit without us decreasing our net worth is because we kept those big expenses down and because we kept the little expenses down when we were making less money so we could get rid of high interest debt so we could invest instead of having debt work against us.

      So yes, 100% agreed!

      • nicoleandmaggie Says:

        Ps one of these days we get granite countertops. Not marble. I think that will be a short lived fad because you have to be so careful with vinegar.

      • Rosa Says:

        In my everyday life what I run into are people who haven’t ever not been in debt, so they can’t even imagine not having that worry.

        But I always say marble countertops because I quit a job where the boss was kind of snarky, saying “well I wish *I* could afford to just walk away from a job” after I’d listened to her negotiate for weeks with the remodelers who were installing hers (and doing other things, I’m sure.)

  14. NoTrustFund Says:

    So fun to watch the mortgage balance. I’d be shocked if it was still around even 2.5 years from now!

  15. SP Says:

    Wow, the mortgage is getting so small!

    We are currently in the “we make more than ever” phase and indulged in a few things we have otherwise resisted lately: vacation and wine. Wine is not a frugal “hobby”, and I usually am careful about what things I add to my life – but we are excited about this! I’ve also been in a nesting / home decor mode, but that has more to do with moving.

    I’m a bit concerned about housing long term, just due to the area we are in. We can certainly make it work, but I’m a big believer in having a budget that closes with a single salary, even if we have 2 workers. I’m not sure that is feasible, and it makes me worry!

  16. Jacq Says:

    My mortgage is variable and still under 3% so no more accelerated mortgage repayment for me like I was doing a year or so ago. I get the same high from seeing dividends go up. :-)
    It’s a world of difference between choosing to and having to be conscious. One is fear based and the other is almost victory-over-self/societal expectations based (or something like that.) One gives you a feeling that this will never end, the other, you know you could choose to do things differently at any time. Sure, it might involve a trade-off, but it won’t be along the lines of “can I eat this week?” It almost has to get down to the survival level of Maslow’s hierarchy of needs / Scarlett O’Hara’s “I’ll never be hungry again” to get the difference in mindset.
    Oh well, if nothing else, you learn compassion from having gone through it.
    Oh – it would be fun if you put in a graph of the declining balance.
    And here I thought that you got to FI/rich by looking at the $10/month optimization of not taking showers. Silly me. At $10/month * 25, you’d have to save up a whole $3,125 to pay for those luxurious showers! What do you mean you can earn that in a week? Work is for suckas!

  17. Laura Vanderkam (@lvanderkam) Says:

    Oh yes, the lattes. Life is so much more fun if you can figure out a way to keep your structural expenses low as a percent of your income, and then you have tons of free cash to play with. And yes, earning more doesn’t have the same hard limits as spending less. I’m always a little perplexed by strange claims that someone can, say, “save $30,000 a year on groceries.” Uh, only if you were spending $30k/year on groceries.

  18. Patti Says:

    Congratulations! Very exciting! I completely agree with the piece of mind statements. Five years ago, I was in debt and beginning to focus on my finances. I was constantly concerned with where every penny went and played a lot of “what if” games in my head. In 2013 I became debt free and now have a savings account with $5K in it– which freed up the worry space in my mind. Savings are automated so this number will keep growing and I am able to handle many “what if” situations as well as plan for a vacation.

    Cats! I used to have 4. 3 have passed away over time, leaving the little one, the perpetual little sister, who began displaying weird behaviors (licking her belly raw… among other things) after her last companion died. The vet suggested getting another cat and I refused to entertain it at the time (my feelings were in part related to grief and in part related to really wanting to have cat-hair free clothing one day). Then my BF’s mother died, who had a young cat to deal with the mice. For a few months, the siblings tried to rotate feeding the cat in an empty house (fail!) until one day she came to live with us. SOOOO now I have two cats, both a little nutty in the head, but adorable. Cat hair still rules at my house.

  19. First Gen American Says:

    The mortgage seemed to go pretty quickly once we were below the $50,000 mark. First, most of our normal payment was going to principle and on top of that, I was super motivated to put extra down to get down to the next $10,000 increment. I think you should go mortgage free for a while, just to see what it’s like. It makes you ask interesting life questions when money starts accumulating without a specific purpose.


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