November 2012 Getting Out Of Debt Update – Refinance

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Spending budget: $400/mo.
Total spent in November:  $340.30, less a $16.30 return = $324

Right now we have a total of $993 in the Disney fund:
I added $35 this month from selling some toys

Our $400 spending budget has to cover all groceries, household
supplies, personal care products, gifts, clothes and other shopping
purchases, as well as home improvement and entertainment.  It’s about a
30% reduction to our spending budget.  My goal is to save enough to cover a trip to Disney World in the spring
(essentially we only have to pay for airfare and 1 child’s ticket).
Airfare is covered, now I just need to save enough for Turkey’s
admission ticket.  It’s the best time for our family to go educationally
and financially,
but I only feel comfortable doing it if we can make significant
progress on the mortgages too.

We spent a lot of money at the beginning of November, but not so much near the end – even despite the Black Friday sales at CVS and Walgreens.  Usually we will put half of the extra money
from our spending budget each month toward our mortgages and splurge money
, but this time around felt it best to reserve the extra for Christmas time expenses.  We did knock an extra 2 payments off one mortgage in November though!

Interest rates have reached a low that I’ve never seen.  Yesterday 15 year mortgage rates were just 2.5% with merely 0.125 points!  Our refinance on our current home reduced our monthly interest by nearly $200, and cut us down to a 20 year loan.  We’ll recoup the closing costs in just six months. With an even more conservative plan than before, we should be 100% mortgage and debt free in less than 9 years instead of 12.  If at any point in time I go back to work full time…well, you get the idea that my grin is wider than the Cheshire cat’s. If you’ve been thinking about refinancing, it’s definitely worth checking out!

Is your family being intentional to get debt paid off before it’s due?  I’d love to hear your story, 
and to even share it here as a guest post if you’re interested.

If you haven’t been following our quest to pay off both houses and be 100% debt free, you can catch up here. 

Getting Out of Debt Step 1: Know how much debt you have and the associated interest rates.
Getting Out of Debt Step 2: Build an Emergency Fund
Getting Out of Debt Step 3 (Budgeting Step 1): Know how much money you have to spend and make sure your tax withholdings are correct.
Getting Out of Debt Step 4: Create a Budget
Budgeting Step 2: Track your current expenses– preferably 1 year’s worth – to see where you’re spending money.
Budgeting Step 3: Make a plan for all your money, taking into account one time expenses.
Budgeting Step 4: Check up weekly  
Budgeting Step 5: Reassess monthly
June Update
July Update
August Update
September Update
October Update 

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Comments

  1. I can see those pearly whites from here. :)

  2. We plan on making a once a year extra payment to knock our mortgage down to 24 yrs. Ideally I am looking for a job, I have been a stay at home mom the last 5 so I don’t look that great compared to others on paper. Looking to make at least 30k so we can live off one income and use the other to pay off our current home mortgage and then the other.