WOOT! 100% Unsecured Debt Free! 1st time in 10+ years.
 

Well, it's official. The electronic payments have cleared and I'm completely unsecured debt free. :dancefool

I've made no secret of my previous financial stupidty ($45K+ credit card and various stupid debt between my wife and I) and while I'm quite embarassed that I let myself get to that point to begin with :o, it is quite satisfying to finally pay it off. No bailouts, no bankruptcy. Just a long 10+ year process with lots of sacrifice (including a paper carrier route for the majority of that time), often at my family's expense.

Every credit card has a zero balance (several cards have been cancelled), past medical bills paid in full and my Jeep is paid off early. Even though there were only 5 payments left, I wanted to get it paid off so that I can get the title in my hand to sell it. I need to have something that will carry at least 5, if not 6, passengers.

I've been considering paying off my wife's Odyssey. We still owe $10K and because of my crappy credit at the time the rate is over 10%. The math says I should pay it off, I'm just concerned about not having enough liquidity in reserves for a rainy day. I might see if the credit union will refinance at the 5.5% preferred customer used car rate for the remaining 36 months and if they don't just ask for the payoff amount and transfer the money right out of my savings to the loan account. That'd free up about $400/month. Or maybe payoff 1/2 the outstanding balance? I guess I already know the right answer, it's just my pessimistic side bleeding through.

It's been a long, tough road and a huge burden has been lifted. Now I can just stew over all of the money I wasted over the years and what I could have bought with it. :mad: I'm now going to be able to put an extra 25-30% towards my mortgage every month and my 401k donation has been upped another 4%.

Now I can begin rebuilding my crappy credit rating, even if for no other reason than personal satisfaction. Thanks for letting me toot my own horn a little, even if it's not exactly something I'm proud of.

Do as I say, kids. Not as I've done!

Hey, great news Swamp! Congratulations!

Thanks, Evan. With all of the financial gloom and doom, I just wanted to shed a little light.

CONGRATS!
That is great. One benefit you forgot about. This will allow you to lead a less stressful life.

Thats pretty sweet.



Gotta be a good feeling too!

You have no idea! (At least I hope you don't :))

If I had any hair I'd be bald and grey.

It does feel good, but there is a bittersweet aspect to it when I think of all the money I essentially pissed away.:(

Congrats Swamp! :)

Thanks, Zeus!

AWESOME!! Congratulations Swamp!!

Debt free is a GREAT feeling.:cool:

I have 14 more years on the mortgage to be "truly" debt free.:D:D

On a side financial note: I just got an enclosed "info" letter in my PECO bill. It states that after January 1, 2011, their capped generation rates expire and they will charge competitive market rates.:(

I think I might take on a loan to try and go off-grid somehow. In 2 years, electricity may cause huge financial headaches.

Good job! On the remaining car loan, maybe you can pay off quickly in big chunks, like $1K at a time. Refinancing always restarts that front-end heavy interest business, only useful if you go for a longer payoff period. You can also switch it over to a home equity loan and maybe deduct the interest.

Congrats - it takes sacrifice and discipline to get you out of the hole. Well done! :)

Thanks, Chad! That is a day I'm truly looking forward to. Hopefully I'll be on track for that now.

I think you're right about electricity. While I enjoy suburban living for the most part, there are times I wish I were further out towards the rural parts so I could do solar and maybe even a little WVO/Listeroid generation for peak use.

Thanks raymr. Those are some good options. I may just pay an extra chunk every month rather than go through the application process. That would seem to be the easiest route.

Thanks, prez! I've learned a lot of life's lessons the hard way. This might be the toughest one!

That's terrific, Swamp! Good for you. That's the best investment you could have made by far. The "return" youre getting from eliminating all of that interest is a lot more than you'd be getting had you been putting all of that into the stock market. That's for sure.

Thanks, Dee! But think of the buying opportunities! :D

Swamp! You're my hero, man! And an example for those who think they can't get out of that kind of rut without those credit card debt assistance companies!

You said it plain and simple...time, sacrifice, and even taking on additional work!

I'm slowly working on mine as well, (aside from all of those darned projects), and maybe can post the same before my kid goes off to college!

Just in time for you! Who knows? If things get REALLY bad, banks may start calling in their loans!!! :eek:

Swamp! Old Buddy! Old Pal. Lend me some money then :D:D

You da man! I make it a point to never have a car payment. Seems to work well.

That's the way I look at down markets. I don't put money into equities that I know I'll need anytime soon. When everything goes the way it's been going lately, I buy the stuff that I've been watching for a while at bargain prices. The market always overreacts. When it does, I try to be there with cash in hand. It's like a giant fire sale.

No small accomplishment for a man with all the cars you have . . . .

Awesome Swamp, absolutely awesome. I remember about a year ago talking about debt and you weighing in on it. Way to go!

I have payed off 15k in the last 10 months and I have about 19k to go then I will be 100% debt free. My goal is 1 year from now. One credit card and one loan...I can see the light!

Nice work.

Thats sometimes a very good idea, a local bank is doing them for 4.5%. Use the HELOC to pay off all the high interest debt, and now you have just one payment, with less interest, so if you keep paying what you were it eats the principal fast! Just can't go rack up the debt again.

Good to hear Swamp!:cool:

I will owe just under $20G's when I get out of school. If I can still sell houses I'll have to sacrifice one deal to kill it.

Well done!

I would pay off the 10% car loan rather than putting extra
payments on the mortgage. Mortgage interest should be lower
plus a tax deduction.

Save emergency money.

401K vs mortgage: I would add more $ to the 401K than mortgage, after
paying off the car and emergency savings.

Well done. Nothing like being debt free. It's liberating not to have a lease on your future labor.

Thanks, G! I also came to the realization that I'm "only" 7 years away from kid #1 ostensibly going to college :eek: and I'd better get myself out of the hole before I started digging that one. Then #2, don't know what the future holds for #3 but won't rule out anything, then #4. :eek::eek::eek: It feels good even if only temporary. :)

Our house will see some long-delayed attention, too.

Aklim, you're a sweetheart. No. :D

Thanks, pp! That is a short-term goal of mine which I hope to continue indefinitely. I can't promise to execute it to the level, or abundance, that you have. ;)

Congratulations Swamp!

I have about 4 yrs left on my mortgage then I'll be eligible for your club membership.

B

Thanks, Graplr! Awesome job and keep it up, that's some aggressive reduction! The satisfaction, and relief, is every bit as great as you think it will be.

Thanks, tank!

Thanks, Hattie. I was one of the fools who did a refi + cash back, early on in my financial excavation, to pay down my debt only to rack it back up again. I've still got plenty of equity but I'm tired of loans and the process in general, even if it might expedite the matter. I'm probably just going to double or triple the payments and pay it off early.

And trust me, there is no danger racking it up again! :o

Thanks, 73...!

That's my line of thinking right now. I'm really just tired of loans.

I upped my 401k contribution to 8% (the company matches up to 4%) figuring I wouldn't really notice it too much since a bigger chunk of that paycheck will be staying home now (and it's probably the time to buy low to sell high:confused:). Once the van is paid then I can really tackle the mortgage.

Thanks, kerry! Very true, even if it's only a recent sensation for me. Now the only lease payment I'll have is the first 4 months of the year for the taxmen. :mad::)

Thanks, Bot! But I wish I was eligible for your club membership! I'm nowhere near where your at, I'm only unsecured debt free (still have one more car loan and a mortgage to go). I'm hoping to get on track about where Chad is now, 14-15 years until I get rid of that mortgage payment. Maybe sooner if the wife ever goes back to work. ;)

http://buildingequity.blogspot.com/2007/04/401k-vs-extra-mortgage-payment.html
"401K vs. Extra Mortgage Payment
If you find yourself with some excess income these days, you may be wondering whether you should put more money into your 401K or pay off your home mortgage faster.

Which is better?

From a purely financial perspective, if you have a low, fixed mortgage rate you are better off putting money into your 401K account. There are 2 reasons for this:


Any extra money you put into your house will have already been taxed. That means that your money has already lost 20% of its value before you are able to use it to pay down your mortgage. 401K contributions are pre-tax, meaning the money goes into your 401k account before any taxes are removed from your paycheck.

Your 401K will likely earn more than what you pay in interest on your house. Let's say your mortgage rate is 6%. Even at a conservative 8%, your 401k will out-earn what you pay in interest by 2%."

I know earning 8% on your 401K seem like a fantasy right now.

I am really proud of you, not many people can say that dude. Just make sure it stays that way.....

Talk up the Navy! Thats what my dad tried, and it didn't quite work.:D

Or the Coast Guard Acadamy...

Things are cheap now, if the interest rate on your mortgage is low I'd pump more into the 401k and maybe buy some good stocks. Like GE, Toyota, etc. Companies that are going to come out of this strong. Thats my 2 cents.

I hope to have my mortgage paid off in a couple of years. Unfortunately, it will be because I have sold the house. I have high hopes for the one after that, though.

What she said.

Congrats on a tough job well done.

Keep that energy up and start putting some away. The more of that you do, the far better you’ll feel about a lot of life’s issues. Not just money ones too.

There are far greater comforts brought via financial freedom than you’ll ever imagine.

Hats off to ya Swamp. Good job.

That is wonderful- great news. I wish everybody could do this.

If it makes you feel any better, you might well have put a lot of this "pissed away" money in the market and lost it , as I did. Lately I have been thinking" Why didn't I run up a credit card debt and live large, instead of being so frugal as not to have had squat all these years". Why did I forgo cable TV, cellphones, new cars, grow my own food? I never had any debt- haven't bought a car on a loan in 20 years , my mom holds our mortgage. Why do I feel so raped and violated these days with regard to a goodly piece of my retirement savings that has gone down a rathole?- but that's another story.:mad:

Rick

Good job!

It motivates me more to hear of people doing that. I'm working on a 2(hopefully) or 3(more realistic) year plan to do the same.

FWIW, stop worrying about the past mistakes, and enjoy your new freedom, you deserve it.

Kudos!

Thanks, Mistress! Now if I can only get this waistline under control...:)

(I'm making progress on that front, too. ;))

I figure either military, smart enough for scholarships or dumb as stumps. Not that you can tell with a young kid but I'm thinking choice #2 might be attainable. :) I don't know if it's just the reduced expectations of the teachers or other parents. Say what you will about the mastery tests, my kids are keeping those school averages up.

My maternal uncle went to the USCGA. Let's just say he's not all there. Although my paternal uncle was a Navy Flyboy and he's not all there either. :D My father was a Coastie...never mind I'll stop there.

I'm not going to dissuade them from trade school either, I'd like to think I could trust one of them not to screw me over with whatever project I needed done.

Thanks, WVO! I've been putting away more than I could really afford to so I've got a decent start.

You are absolutely correct on the other points, the financial burden extends beyond the just monetary.

Thanks, Rick! Sorry to hear about your situation, though. In my case I wasn't even living large, I've really got nothing (materially) to show for it. Do you have time before retirement to wait out this mess and hope for the upturn? I can't even begin to imagine how maddening that must be. :(

Thanks, Plantman! You can do it. I know it's got to be tough given your current situation but if 2-3 years is a real possibility for you keep focused on the finish line. Over the nearly 11 years there were times I felt like just throwing it in and declaring bankruptcy (like I had seen others do and pay little for it-that was before the laws changed), it was hard to see the goal. Once I got under 5 years it gradually got a little easier and easier with each passing year. My rating still sucks but it's got to be better than it would with a bankruptcy on it.

Swamp Yankee-

In my case, it's hard to say right now how soon I may be able to retire. I am about to turn 54 and was thinking (last year when I thought I had some real money) the escape might be 57 or 58. Now I am hoping for 60. We have an 8 year old child that plays heavily in the equation. She's probably bright enough for scholarships (if there are going to be any in 10 years) but I can't bet the farm on anything like that.

Still, what you did was the right thing to do. This country has puked all over itself on credit and easy living. Now comes the hangover.

Rick