The last few days of catching up on blog reading highlights my basic complacency with life and times. In truth this is not a bad thing; stability is very soothing to me. Yet beneath it all I am feeling a little restless and affected by those around me and the blogs and general news I am reading. Suddenly I do not feel all that complacent.
I am a long-time YNAB user and also read their forums and used to follow their blog. I say “used to” because about 6 months ago they hired several new bloggers and it became a fluffy and BORING place to read. Each had their own story and talked about things going on in their lives and how the software had helped/was helping them get through their lives with too much month for their earnings. Where I am typically engaged with the whole personal story section, it just did not work for me and I simply stopped reading. Then a few weeks ago the owner of the firm wrote a startling, tough-love anti-debt post that was like the shot heard round the world. The comments lit up, people were talking about it in the forums, and everyone seemed to have their panties in a bunch about it not being touchy-feely enough and more sensitive to their individual situations and how hard it is to get out of debt. The reactions bothered me far more than the actual blog post, because the blog post did stir my thinking.
Life for me is pretty routine. I have a happy home life with M. My kids are healthy and in pretty good places (C’s little dog was hit by a car and died on Sunday night so she and A are sad and grief-stricken). September is vacation month for us in that we just returned from the Reno air races and are about to depart on our annual adventures in Portland. I have some ongoing uncertainty in my full-time job, but it’s familiar uncertainty, in that we are in a dying industry and will likely wind down as a firm sometime within the next few years. We have been saying/thinking that for about the last three years, so I wake up most days grateful to still be employed another day. My part-time gigs are now two, but both are flexible and lucrative enough to allow us room for additional savings and fun we enjoy. It’s good that I enjoy the work I do and have this many jobs, because I have exposure in different industries and a comfortable fallback position in the even my full-time job does wind down someday.
I am working on our budget for 2015. Yes, already. I always start in September, because I am thinking about projects we planned for the fall and what we want to accomplish in the spring before the heat really gets going. To plan those projects means coming to terms with the budget.
Right now we have no debt and save a significant chunk of our income. I figured it out once and it averages out to like 45% of our gross income. Part of that is to pay taxes on my part-time job income, part of that is for retirement (Simple IRA for me at work, IRA for M, Roth IRA for me), part of it is for future house projects, and the rest is emergencies, vacations, periodic expenses, etc. We have also been paying extra principal on our mortgage, which is part of what I am presently rethinking. It’s the accountant in me; I get paid to worry about money.
Our plan has always been to pay off our 15 year mortgage by the end of 2022, and that plan is still in place. However, instead of extra monthly principal payments, I am changing our strategy and going to put that money into our taxable investment account for now with a plan to do a larger lump sum at the end of 2022. I realize that our interest rate is very low – 2.75% – and even if we went the full 15 year term the interest paid would still be less than where we started when we bought the house with its 4.25%, 30 year mortgage. The primary reason for this change is simple: we are not sure we want to stay in California in retirement. We love, Love, LOVE our home and can see being here forever and ever, but reality is it’s expensive to live in California and our money could go a lot farther somewhere else.
So instead of trying to race and get 100% out of debt as quickly as possible, I’m thinking more about staying in mortgage debt for the next 8 years and then examining our options at the end of that period. This is the current plan today, for 2015. We will see what I am doing and thinking once September 2015 rolls around and I am going through this exercise once again.