Paid off my mortgage today!

I received my end-of-year bonus today and immediately went to the bank and paid off the remainder of the mortgage (a little over $3000).  It was a 10 year loan (refinanced in 2012 from a 30 year) and I had been paying an extra amount each month towards the principal.  So I paid it off in a little over five years from the last refi. 

So now the only debts I have left are my car loan (and since it's a 0% interest loan, I just pay that each month from my savings account) and my student loan debt.  The student loan is a little trickier - I keep thinking about paying it off, but  I didn't start paying on it till the year after I graduated from law school at age 51. It's a 30 year loan, which means I'll be 82 by the time I pay it off.  I could pay it off early, but since student loan debt is the only debt that goes away when the debtor dies, I figure I'm in a win-win situation.  Either I live to be 82 (or more), in which case I pay it off, or I die early (hopefully not) and it goes away.  It's only $425/month with an interest rate of 3.25%.

Does that sound rational???  🙄  

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    • MsTJ
    • YNAB has given me back my future
    • Believer_in_YNAb
    • 4 yrs ago
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    Congratulations on paying off your mortgage.  Your time frame is amazing.  What are you doing to celebrate? (I keep forgetting to celebrate)

    Regarding your student loan, I'd probably do what you are doing. Being debt free sounds nice also.  If I got some extra money I might throw it at the debt, just be rid of it though. 

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      • Whereforart
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      • whereforart
      • 4 yrs ago
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      TryingToGetAhead Thanks!  Unfortunately, I'm sick with an upper respiratory infection that is going around the city, so I can't celebrate until I feel better.  But I may invite a friend over (who is close to doing the same thing) to have a drink while I burn the mortgage. 😀

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  • Whereforart What an incredible achievement! Your story motivates me, as I made similar decisions!

    About six years ago, I refinanced my mortgage -- reducing the balance from €262,000 to €209,000 at that time. Since then, I have been paying additional and at this time the remaining balance is a little less than €30,000. My plan is to pay off the mortgage completely in 2018.

    I am in a similar age group as you, and although I saved quite a bit in pension funds, my next goal is to save, save, save as much as possible in order to achieve financial independence (in essence, bridging towards the legal pension age in The Netherlands of 67 years and 3 months).

    I cannot wait to achieve full mortgage pay-off, but I am wondering now: how are your feelings about complete pay-off? Are you feeling satisfied, or is there perhaps some kind of emptiness because over all these years you had been frantically chucking away the balance and all of a sudden it is done?

    Before I forget: I hope you recover from your infection soon. You really should celebrate!

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      • Whereforart
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      • whereforart
      • 4 yrs ago
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      Optimist Thank you!  You know, that's a good question.  I don't feel any emptiness at all - just complete satisfaction and a profound sense of achievement.  It's partly because I see a lot of people in my line of work (I'm a divorce attorney) who are my age and earn very good livings but have a huge amount of debt and no savings.  I had a client last year who was getting a divorce - he was in his early 50's, had earned over $200,000 per year for most of his life, and had nothing to show for it but a house with a huge mortgage, a 401(k) plan than only had $35,000 in it, and about $15,000 in credit card debt.  When I see that, and then look at what I've done, I do feel like I've accomplished something. 

      It was hard - as an attorney, most people expected me to drive a Lexus and live in a big house - instead, I drove a used Honda Civic and have stayed in the same 2 bedroom brick house that I bought 18 years ago.  But now my mortgage is paid off and when I retire in 2 1/2 years, I will be debt-free (except for that pesky student loan). 🙂 

      And kudos to you for what you've done - that's amazing!  Good luck with your 2018 goal!  By the way, I will be in the Netherlands in May of next year - mostly in the Amsterdam area.  I found a great deal with WOW Airlines for $550 RT from Cincinnati and I'm very excited to be going - I've been to most of western Europe but not the Netherlands.  If you're going to be there, I'd love to meet with you and buy you a coffee or something.  I'm going to be staying in a room in the De Pijp section of town.

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      • Optimist
      • Optimist
      • 4 yrs ago
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      Whereforart Thank you so much for your kind words, and great to know you will be coming over to The Netherlands in May. We should meet up -- that would be wonderful! And what a great deal on the plane tickets!

      As it happens, I am living quite close to De Pijp, in a small village named Diemen. I happen to be working for an American company here in Amsterdam (Verizon), and I will be more than happy to spend some time and perhaps show you some highlights of The Netherlands off the beaten path if you would appreciate that.

       I can relate to what you mention about expectations others may have about your lifestyle. It seems sometimes the Joneses want us to keep up to their (consumer) lifestyle. ;-) Most of my coworkers (especially the core sales guys -- I am a solutions architect in a sales role) drive quite expensive cars provided by our employer, but as they are being taxed as a source of income here, I opted for pay out of the leasing budget and buying a 2 year old modest Ford Focus. That was ... thirteen years ago. No posh Audi's or BMW's for me. I am certainly standing out from the crowd driving such an older, well maintained vehicle and it is often discussed at work in a positive, jokingly fashion. :-)

      Anyway, please do let me know about your itinerary when you are getting close(r) to travel date. I will ask forum support to relay my contact details to you (private messaging had been disabled temporarily).

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      • Whereforart
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      • whereforart
      • 4 yrs ago
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      Optimist The support team did so - it appeared in my email so I will email you my contact information.  I would love to meet with you and get any ideas and tips that you have - and especially places off the beaten path.  I am really looking forward to this trip.  Thank you!  

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  • That's amazing! Well done on paying off your mortgage! I set myself an extremely ambitious target regarding my mortgage yesterday. Can't wait to be mortgage free!

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    • p.s. do these usernames get automatically assigned? I have no idea where it came from :-D

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      • Whereforart
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      • whereforart
      • 4 yrs ago
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      Gray Keyboard The user names are automatically assigned but you can change them by editing your profile.  There is a link to it in the upper right hand corner of your screen.

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  • I am finding you inspirational in a few ways. First, congrats on paying off your mortgage. We purchased our home in 2006, which was at the peak of the housing bubble. Essentially, we paid $529K for a house that was worth $385K a few years later, and even now, 11 years later, it's supposedly only worth about $470K. To get the house, we didn't have enough for 20% down, so we put 10% down and financed $475K. We're at $350K now, a long ways away.

    Secondly, graduating law school at 51! I keep telling my 41-year-old wife, who has a (useless) liberal arts degree that it's not too late to go back to college for something that pays. She makes $15 an hour part time now doing admin work at a local elementary school. I make about 95% of the income, and it's a burden and a half. I keep telling her that it would be worth investing in a higher paying career through education and she thinks it isn't worth the time or money, especially since we have 3 kids who will go to college, the oldest is a junior now so we're 1.5 years from her starting somewhere.

    To answer your question, I would say your are WAY better off putting any extra money into an investment. Even a 6% market return is a net win for you, and that is excluding any tax deductions you would get for your student loans (not sure if the GoP is taking that away too, as part of their new crush the lower/middle class tax plan).

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      • Whereforart
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      • whereforart
      • 4 yrs ago
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      Silver Dollars Thank you so much!  I can tell you that going back to school at age 48 was the best thing I ever did - I have never once regretted it.  And in the words of someone I cannot recall (and I'm really paraphrasing here), you're going to grow older no matter what - you can grow older with a better degree or or grow older without it. 

      My daughter, who is 38 with an education degree, just decided to go back to school and is enrolled in a physician's assistant program.  She is married with three children, all under age 9, and one of whom has severe special needs (he is in a wheelchair, non-verbal and with a g-tube).  I figure if she can do it, anyone can.  😊  

      And thanks for the advice about paying the student loan debt vs. earning more interest. I have a lot of savings that always do better than 6% so that makes sense.  Unfortunately, I make too much money now to be able to deduct the interest.  However, once I'm retired, that will undoubtedly change!

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    • Whereforart Savings that makes more than 6%? I have to assume you are talking about investments (versus savings, which tend to have a 0.5 to 1.5% return rate these days, or CDs that get as much as 3%). If so, pray tell what they are so I can follow your lead 🙂

      But in either case, paying off that debt saves you 3.25%, so if you are making as much as 8-10% on other investments, then that's the best place for the money to go, especially since it would be more liquid. You could lose a little in capital gains, but it's still a better move.

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      • Whereforart
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      • whereforart
      • 4 yrs ago
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      Silver Dollars Yes, sorry, I meant savings generically. Most of my money is in  investments. 

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  • Congrats! I am also an attorney trying to get on a healthy financial track after years of living irresponsibly. Thanks for sharing your example!

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    • Heather
    • YNAB-Obsessed since 2014
    • estheticianbabe
    • 4 yrs ago
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    Congrats on paying off your mortgage!  That is amazing!

    And thank you for being very inspirational about going to school later in life.  I'm still a (young) 32, but the thought of going to college at my age is daunting, so thank you for being very motivational that you can get an education or start over at any age.

    As far as the student loan debt goes, I guess my only concern with keeping it would be if you faced an illness or unexpected hardship and that $475/month payment could become a burden.  As long as you have a solid emergency fund in place and retirement assets, you're likely okay, but the student loan only gives me pause when I think of a very long-term illness that could drain all your savings.

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