Jans Great Mortgage Payoff

Jan

New Member
#1
We are about to finish paying off our credit card debt and can't wait to get stuck into paying off the mortgage for good! My goal is have it paid off by end 2019.

Heres our starting ( September 2015) data:
Mortgage: $186,419
Interest rate: 4.8%
Monthly payments: $1276
Term 20 years
Redraw: $79,270
Monthly payment I/O $310
Total Mortgage Debt: $266,689

The redraw is the deposit amount of two investment properties we bought a few years ago when we borrowed against the value of the home ( $400,00).

About us - we're in our early/mid 50's, both employed full time. I have a government job in a sector that is being privatised. We've had layoffs every year for the last three years and another 32 are to be laid off at the end of the year ( not me). The team I am in was halved two years ago and I kept my job but realistically its highly likely that lay-offs will continue and eventually my position could go. I have nine months salary saved on the deferred salary scheme so thats my first back up plan. If I do still have a job in 2019 then I will take that year off and use up the salary. My goal is to have the mortgage paid off by the end of 2019.
My husband works for a non profit and so he is able to salary sacrifice into the mortgage.His job is secure and he likes it so no concerns there.

The plan. - We should have the last credit card paid off within the next month. Then most of those snowball payments will be directed into the redraw part of the mortgage and we will reduce the redraw balance each time we hit a $5000 reduction. The remaining extra funds will go onto the regular mortgage balance.

I'm really pleased to be able to join up with others focused of paying off the mortgage and look forward to sharing my progress and reading about other peoples payoffs and ideas.
 

cdub

Club Founder
Staff member
#2
I'm really stoked you joined the site. Let's kill the debt and the mortgage for sure. :)

I guess "redraw" is Australian for Home Equity Loan? That's what they call it here in the US.

That stinks about the possibility of getting laid off but it sounds like you have a good plan. One of the main reasons I want to pay it off is because I'm self employed and my jobs are usually only for a couple of months and then I'm out looking for the next gig. Reducing expenses will be a HUGE stress reliever.

YNAB was also a huge stress reliever... I did a post about it here. (it's a financial software application if you're not familiar with it)
 

Jan

New Member
#3
Yep, the redraw would be the same as the equity loan I'd say.
Freelance can be difficult if you hit a quiet patch. I used to have my own business and the first year was the most stressful till I got used to when the quiet and busy periods were so I could take advantage of them.
I have bought YNAB but need to spend some time setting it up properly.
 

cdub

Club Founder
Staff member
#4
Yes thankfully I've been pretty steady in regards to work (knock on wood) but it's nice to have the buffer and e-fund just in case.
 

Jan

New Member
#5
I spent the weekend going over our budget and setting up YNAB - I'm really pleased with it and we have both have the phone apps so we can record transactions on the go. I can see that using YNAB is going to help me keep track much more accurately.I'm trying to cut our expenses further. We've just changed our house & car insurer and that has saved us over $700 a year. I think cutting costs is easier than increasing income.
Our usual mortgage payments go straight into the mortgage account every week and then I transfer any extra payment over. At this stage it looks like I'll have the credit card paid off, emergency fund filled and some large bills paid by the end of December and then I can throw everything at the mortgage from January - can't wait!!
 

cdub

Club Founder
Staff member
#6
I spent the weekend going over our budget and setting up YNAB - I'm really pleased with it and we have both have the phone apps so we can record transactions on the go.
That's great. YNAB has been a life changer for me. Some people hesitate switching over because of all the records in the old system they were using... but I found that a clean slate with YNAB was quite helpful. We're using it to improve our future financial life so our past shouldn't matter as much. I found that if I wanted to check old records I could just use the old software... but I really never went back except for tax season that year... and then never again.

As far as entering transactions as I go on the app.. I haven't used it that much but I can see how it'd be very useful. I'll need to do it more.

At this stage it looks like I'll have the credit card paid off, emergency fund filled and some large bills paid by the end of December and then I can throw everything at the mortgage from January - can't wait!!
Awesome. Around that time I should be fully buffered in my business account so I should be able to throw alot more to my e-fund to get that up to snuff. After that it's all going to the mortgage. (I'm still maxing out the retirement accounts)