It’s hard to say what has changed because so many other money things have changed as well. DC2 is no longer in preschool so we’re not paying for that, and DH and I are both getting full-time salaries (and we’ve both gotten raises).
Our non-mortgage/non-daycare spending has definitely gone up. We were in the city the other day without the kids and didn’t even blink at spending $30 at a cafe for two meals (duck confit and bean ragout for DH and blood orange beet salad for me). We’ve been flying to DH’s family for Christmas instead of driving. Whenever I’ve been feeling stressed, I hit up donorschoose and drop $25. And there’s been all that political spending. And summer camps aren’t cheap. But, with the exception of DH’s new car (can we really make that an exception?), I don’t think this additional spending has completely caught up to the $750/month we were spending on daycare plus the $1,214.40/month that was going directly to payoff our mortgage. (Not including property taxes and insurance, which we still have to pay and both of which have gone up quite a bit in the past two years.)
So I guess bottom line– Not having a mortgage has increased our spending, but it hasn’t been a 100% offset. Not having a mortgage has also increased our monthly cashflow cushion. There’s just more left over at the end of most months. The first mortgage-free year (when DC2 was still in preschool much of the year) I was still having to dip into savings on occasion to pay the big bills like income tax or property taxes, but this year I was able to cash-flow property tax from DH’s salary (DH’s salary direct deposits into checking and mine into savings). We’re not really living on just DH’s salary because almost all of our retirement savings and benefits spending comes out of my paycheck, but for the past year (minus the car purchase) it sure has been feeling like we don’t touch my income.
We’re also now almost getting to a point in which we have to decide what to do with the extra build-up of money since we’re maxing out our tax-advantaged retirement savings (including backdoor roths!) and have paid off all our debt. We do have a list of important big expenses that we’ve been going through, which is why we’re now at the Kitchen Renovation bullet. If we still had a mortgage, I don’t think we’d be there.
Has your life changed after finishing a big regular expense like daycare, a mortgage, or a car payment?