Successful but discouraged -- how do you stay motivated?

Have you paid off your debt? Managed to save for your dream home? Had an awesome investment pan out? Share your personal finance success stories here.

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Cely
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Successful but discouraged -- how do you stay motivated?

Postby Cely » Wed Feb 06, 2013 9:30 pm

I realize I have a lot to be thankful for. I've worked very hard at saving and earning more, and since 2008 (when I started reading GRS) I've funded a 6-month emergency fund, paid off my car, paid off my second mortgage, and paid down almost $100K of principal on my remaining mortgage. I save the max in my 401k, give to charity, and have made some other investments. (No CC debt.) I still need to do more but I've gotten myself to a good spot.

I am currently paying 3x my monthly mortgage payment, but even at this rate it will be years before it's paid off. My husband and I would like to start a family so we're also beginning to think about a house (we live in a 1-bedroom condo with no yard). It's just really hard to feel like I'm making progress when my nearest debt payment goal (mortgage) is so far in the future. It was so satisfying to pay off that car debt, and hit my EF number! But those goals didn't take longer than two years.

How do people stay motivated and excited to pay down a mortgage?

brad
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Re: Successful but discouraged -- how do you stay motivated?

Postby brad » Thu Feb 07, 2013 7:17 am

One thing that I do is maintain a spreadsheet that shows how much of the house I own and how much the bank owns. It becomes a little game: each time the percentage we own ticks up one point (which usually takes a few months' worth of payments) we draw an imaginary line across the house. We currently own most of the living room and by next year we should be into the kitchen, for example. That helps keep us motivated.

You could also plot a pie chart or line graph to track your progress. It's slow, but over the course of a year the progress is visible and tangible.

Cely
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Re: Successful but discouraged -- how do you stay motivated?

Postby Cely » Thu Feb 07, 2013 3:26 pm

(OP here.) Thanks Brad. I wonder if it would help to do a graph showing progress if I was only paying the minimum, versus what I'm paying now. It's the s-l-o-w-n-e-s-s of the overall progress that kills me, so maybe seeing the delta would help.

toolcrib
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Re: Successful but discouraged -- how do you stay motivated?

Postby toolcrib » Fri Feb 08, 2013 6:57 am

Cely,

I have been paying ahead on my mortgage, and have been tracking it with an Excel spreadsheet I found online. I just did a search for "Mortgage calculator spreadsheet" and found one I like.

The one I found generates a graph showing the remaining principal over the life of the loan if you make the minimum payments, and a second line showing the principal over time for past and future overpayment/principal reductions. The effect of future additional payments is nice, as it shows you the reward of paying ahead. It does not include any escrow calculations though.

Other benefits is that it will show the total interest paid over the loan, and how much interest has been saved by paying ahead. I found this to be a good motivator, especially at the beginning when an additional payment had a significant interest savings.

Thanks,
Andrew

RayinPenn
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Re: Successful but discouraged -- how do you stay motivated?

Postby RayinPenn » Sat Feb 23, 2013 5:26 am

You are me only 20 years go! My wife and I practiced the following:

1) We made extra payments on our mortgage when we could.
2) We clipped coupons and always bought on sale
3) brown bagged it
4) avoided $4 cups of coffee
5) bought a modest home we could afford.
6) never, never used credit card debt. I work in the credit card business and I can tell you those little plastic squares can ruin a marriage and family.
7) when extra money came our way we spent a little and invested the rest. We bought modest amounts of dividend paying stocks. When that first dividend comes in it is an awesome feeling.
8) drove the same car for 13 years and when we did buy it wasn't a Mercedes.
9) a big night out was take home chinese or pizza and a $1 movie
10) we refinanced when the rates were favorable.
11) We took vacations that we paid cash for

The results of this life style "living like so few do" are wonderful. When money concerns are removed from your life you will achive an inner peace that is better then any yoga session. Your focus changes, you feel in control. I grew up in a paycheck to paycheck house. If anything broke car, boiler or whatever it was a disaster. It was stressful, not healthy and took our focus off living and enjoying life. Now I spend my days pondering where and when to retire - the choices are endless.

I do not fear the layoff, dental bill or broken transmission. It is a great way to live. So when you feel a little discouraged think about the end game...It is so worth the discipline. I feel truly blessed.

My lunch Thursday was peanut butter and jelly whole wheat sandwich and a mug of chicken soup that I bought from home. The discipline never changes.
RayinPenn

“If you tell the truth, you don't have to remember anything.”
― Mark Twain

Fredy Atwater
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Re: Successful but discouraged -- how do you stay motivated?

Postby Fredy Atwater » Wed Jul 03, 2013 12:39 am

By making a plan to accelerate the payment of my home without having to sell my stock investments. I have a second investment meant to pay for my home mortgage balance in 1 or 2 years. That's the best that I can do.

Sincerely,

Fredy

khaera
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Re: Successful but discouraged -- how do you stay motivated?

Postby khaera » Sun Jul 14, 2013 9:23 pm

RayinPenn, I like how you handle the same situation. I am 22 years old and I find that post of yours very helpful. Though my situation is not the same as yours, all of it are good inputs. Thanks!

How do I stay motivated? - since I'm single, my only motivation is my future family. :)
The time for action is now! It's never to late to do something.
-Antoine de Saint-Exupery
http://action-hq.com/

RayinPenn
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Re: Successful but discouraged -- how do you stay motivated?

Postby RayinPenn » Mon Jul 15, 2013 5:16 am

Answer: In keeping with the thought "A voyage of 1000 miles begins with the first step"...
1) Set small achievable goals.
2) Find a savings/spending balance that works for you? If you only save then youll no doubt burn out...
3) Work at savings - clip coupons and celebrate good deals.
4) Have fun with it.
RayinPenn

“If you tell the truth, you don't have to remember anything.”
― Mark Twain

Cely
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Re: Successful but discouraged -- how do you stay motivated?

Postby Cely » Mon Jul 15, 2013 2:10 pm

OP here. Just thought I'd give an update as to how things are going!

I've actually found a simple way to keep me motivated short-term: it's dropping below each 10K mark on the remaining balance. So if I'm at 167K, the goal is to "break" into the 150s. Then the 140s. etc etc etc. I can make daily/weekly decisions that materially impact how quickly I get to the next goal, so it makes me feel like every dollar really counts. If I have surplus money in my account before payday, I can funnel that to the mortgage (in addition to the extra payments) and see myself get closer to the next marker.

I'm also waiting to close on a refi which will drop my monthly payment far below what I'd charge for rent, so someday soon I might be in the position of having a renter helping to pay down the mortgage, which would be lovely!

Jerry
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Re: Successful but discouraged -- how do you stay motivated?

Postby Jerry » Sun Jul 21, 2013 11:31 pm

The lower the principal balance on the loan the more equity you have in the property. That means you own that much amount of property. Keep yourself motivated by the fact that the more you pay off, the more you would be own the property, In this way, one day you will own the property free and clear. Consider it to be a long term investment.
Jerry
Forum Moderator, MortgageFit Community


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