A lot has happened since I first formulated my Mortgage Plan. While the numbers for how I can make the mortgage disappear are still valid I have had to go back and take a look at where the money is coming from. The biggest change has been that I will not be seeing disability benefits at my current pay level. I wish I could tell you why but I don’t actually know how the calculations work. Apparently they just type people’s information into the computer and it spits out an answer. No one I spoke to seems to be able to do the calculations themselves. Add to that the fact that I have been accepted to start my Masters in September and could potentially see a 20% pay cut.
As things stand I:
- made my 10% lump sum payment for the year
- have enough money from rent to cover my double ups until September
- am on track to finish saving for a car and emergency savings by September
- have $19,913.45 in savings to put towards my mortgage
So I have decided to take a slightly different approach to the problem and divided it in half; the monthly double ups and the yearly 10%.
I am challenging myself to come up with the money for double ups ($1,422.56 this year and $1,564.80 next November) entirely from my monthly paycheck.
If my pay drops to 80% I will see $2878.71 every month while I do my Masters. I am hoping to divide it as follows:
Mortgage – $1,564.80 (as of next November so I’ll plan for it now)
House Maintenance - $250.00
Housing Taxes - $182.50
House Insurance - $72.00
Utilities – $230
Savings - $290
Transportation – $15 (I’ll get a “free” bus pass with my tuition)
Food - $100
Cell – $25
Internet - $50
Health Insurance – $23.52
Clothes - $5
Gifts - $5
Misc - $10
Big Ticket Item - $25
Entertainment - $10
Social/Sports - $5
Financial Planning - $14
Left over - $1.89
Yes, I realize that it is a supper squeaky budget, but at the drop of a hat I can move my mortgage payments back to $646.62, thus freeing up $918.18 a month. The sooner I make extra payments the more of an impact they have on interest earned. Since I’m always up for a challenge I plan on giving this a go and seeing what happens.