HOW we paid off our mortgage on one income!

Last week I posted about WHY we chose to pay off our mortgage. Today’s post is about HOW we paid it off in six years on one income.

First, I should let you know I did some substitute teaching for about 5 months before we had children. So we were “double income” during that time, even though the amount I made certainly didn’t approach full-time employment.

On our honeymoon Scott and I read one of our wedding gifts: Total Money Makeover. After that we were sold on paying off our mortgage. But we thought: “How in the world are we going to do this on one income, and a teacher’s income at that?!”

One of the main principles I took away from the book is: “Live like no one else so that you can live like no one else.” Scott and I knew that if we were going to pay off our mortgage on one income we would have to do this! This became a mantra for me when I felt like a weirdo for not doing what everyone else was doing.

Here are ten things we did to “live like no one else” so we could put that extra money toward our mortgage. You’ll notice there are no fancy formulas or budgeting techniques. We simply lived in a way many others would consider extreme, and we still largely live this way today. I believe many people would consider our lifestyle extreme simply because we live in such an indulgent society.

1. We rarely ate out.

Perhaps twice per year and only when we were traveling more than four hours on the road. Usually we brought food with us. If we did go out for a birthday or anniversary we used a gift card. Making meals at home saves LOTS of money. I must admit one thing that helped us was having four children six and under. They didn’t eat much :).

2. We didn’t go big on holidays or birthdays.

For birthdays we buy one gift for each child, and have dinner and cake that I make. Scott and I don’t buy anything for each other on holidays, anniversaries, or birthdays. It’s a nice mutual agreement we have that keeps expectations and expenses low 🙂 For Christmas we let each kid buy their siblings a small gift and then we ask the grandparents to only buy one special gift for each child. Holidays can REALLY ADD UP. Our minimalist approach to toys saves lots of money. We buy the same types of toys but not a lot of different ones. Many kids have toys laying around they never play with! Figure out what toys your kids like and invest in those. Now that we paid our debt off we have invested more in quality toys. Continue reading HOW we paid off our mortgage on one income!

WHY we paid off our mortgage!

This is the first of a two part blog post! The next one will be on HOW we paid off our mortgage. This one will focus on WHY.

My husband and I paid off our house in six years of marriage. We owed $160,000 on our mortgage at the time. I also owed about $6,000 for school loans that we paid off within the first year of marriage. Scott (my husband) had some school loans but they would be paid off through a grant program as he taught at a low income school district in Ca. That was all our debt. We didn’t, and still don’t, do credit cards and we pay cash for vehicles.

Early on we wrestled with the idea of paying our house off because of the tax deduction we got for having a mortgage. Dave Ramsey helped us out with that decision though:

If you have the opportunity to pay off your home and you don’t pay off your home in order to keep the tax deduction, that would be an indication that you are poor at mathematics. Let me help you with the mathematics on this. Let’s say you have a $200,000 mortgage at 5% interest. If you have a $200,000 mortgage at 5%, that would be $10,000. We have a $10,000 tax write-off because we have a $200,000 mortgage at 5%. That’s a tax deduction, meaning if that couple makes $75,000 a year and they take a $10,000 tax deduction, they don’t pay taxes on $75,000. They instead pay taxes on $65,000. If you do this weird Dave Ramsey thing, though, and you pay off the house, you no longer pay taxes on $65,000 because you would not have a tax deduction. You’d have to pay taxes on $75,000. You’re in a 25% tax bracket if you make $75,000 a year. That $10,000 a year that we’re talking about is taxed at 25%. By paying off your home, 25% of that $10,000 that you’re going to have to pay extra taxes on is $2,500. In essence, you lost a $2,500 savings on your tax bill, but you gained $10,000 by not having to pay it to the bank. A $10,000 tax deduction is the same thing as saying, ‘I would rather give Countrywide $10,000 than give the government $2,500.’Continue reading WHY we paid off our mortgage!

Saving Money When Practicing Hospitality

Let me start by saying that hospitality is not a gift, it is a command. “Above all, keep fervent in your love for one another, because love covers a multitude of sins. Be hospitable to one another without complaint. As each one has received a special gift, employ it in serving one another as good stewards of the manifold grace of God.…” (1 Peter 4:8-10)

Notice the commands surrounding the part about being hospitable: keep fervent love for one another and serve one another with the gifts you have been given. Those are not things for us to choose to do, we are called to do them as Christian women and that is also the case with being hospitable. Some people may be better at it than you but you are just as called to invite others into your home as you are called to keep fervent love for one another.

Keep in mind since hospitality is something God commands then surely He is acquainted with the fact that it costs money, it is not a surprise to Him. I also think it is a GREAT use of God’s money. In our stewardship of His provision I think it pleases Him when we spend money on hospitality/loving the saints and strangers in our home. 
Continue reading Saving Money When Practicing Hospitality

How I Get My Groceries Delivered To My Door AND Save Money!

I love Safeway. I like their quality. I like their options. I just don’t like their prices. But here’s the good news! I have figured out how to shop at Safeway, get my groceries delivered for free, get a dollar off a gallon at the gas station AND save 25-45% off my grocery bill EVERY time! (p.s. I am not getting anything from Safeway for sharing this)

Here’s how I do it.

1) Go to: http://www.safeway.com/.

2) Sign up for: Just For U and for grocery delivery (you will have to sign up for both separately).

3) Go to Just For U and “clip” coupons. It doesn’t get much easier than this! You just push the button “add” and it’s put on to your account! Easiest couponing ever! ALWAYS look for a 20 cent gas reward coupon. This means for every $100 you spend you will get 20 cents off a gallon. (sometimes even more!) I also just saved $10 off on frozen pizzas with my just for u coupons! You also get extra gas rewards for using these coupons! For example today I got 220 EXTRA points toward my gas rewards from my “J4U Bonus”. (see receipt below) Gas rewards are such an extra perk to shopping with Safeway. We usually have a dollar off and that really adds up with a 15 passenger van to fill!

4) Go to your grocery delivery account. Continue reading How I Get My Groceries Delivered To My Door AND Save Money!

Why WE Don’t Live Within Our Means

We don’t live within our means. We could be spending a lot more money than we do. Our means, the amount in our savings, says: “go ahead and live a little” but in my husband’s wisdom he admonishes us as a family to save more rather than spend more. Future generations will reap what we sow.

We have plenty of money in savings because we:

  1. Don’t go out to eat more than once a month and we pretty much never go out to coffee.
  2. Plan very few trips. In fact, we hardly leave our house. I had been looking for a particular sippy cup for weeks. I went out to the van and saw it was there! Guess it had been a while since we had gone anywhere 🙂 Going places usually means spending money even if it’s only on gas. I must admit that we have more freedom in this because we live downtown, next to our church, the library, parks and family.
  3. Rarely buy new clothing.
  4. Only get one nice gift for the kids on their birthday. (What a waste so many toys can be!)
  5. Paid off our mortgage! Talk about making it easier to save money!
  6. We really try not to waste food…. or anything for that matter.

Here is a link with more of our tips on saving!

You see, just because you have the money to:

  • Go on more trips
  • Buy more toys
  • Go out to dinner often
  • Purchase new clothes etc.

Doesn’t mean you have to. Don’t spend money just because you have it. Buy what you NEED not what you WANT and then later in life you can buy what you want not just what you need without the guilt!

Too many are living outside of their means in the other direction. They spend money they don’t have and wonder why they are constantly struggling financially. I have also seen people get out of debt and then think that gives them the liberty to spend their money any way they please only to find themselves in debt again or living paycheck to paycheck.

My husband fulfilled one of his dreams to publish a book! We are all very excited and it has been such a joy to be able to invest in this dream of his without having to worry about the money we are putting into it because we have plenty saved up. Another huge benefit of living like this is we are better able to give!

Please don’t think we have plenty in savings because we make lots of money 🙂 We have been single income our whole marriage (except for a few months that I did substitute teaching) and my husband went from being a public school teacher to a pastor… neither of which are known for their high income 🙂

Not sure how to live within a budget?! Dave Ramsey can help! Click here. 

Lastly, every human should watch this. It cracks me up and it’s so true! 🙂

So save up your money and then save more! Don’t live within your means. Live below your means and watch your savings grow.

contentment

Have you checked out my husband’s book, Marriage God’s Way?