So many dark red walls to paint a light grey!
DH = dear husband
When we started our journey out of debt in June of 2012, I was 49 years-old and DH was 53. With retirement on the not-so-distant-anymore horizon, here’s how things were:
- consumer debt – $21.000
- business debt – $81,000
- mortgage debt – $155,000
- Total debt – $257,000
Inspired by Dave Ramsey’s The Total Money Makeover, DH and I made debt elimination our mission. We had “wandered into” a level of debt that had brought us far too much grief, but we knew that “wandering” would not get us out of it. Ramsey speaks of the focused intensity needed to make debt-pay-off happen, and focused intensity is exactly what has allowed it to happen for us.
An overview of our progress
With a budget, a tracking spreadsheet, a readiness to face our flaws of character and the negative patterns in our relationship that had kept us in debt…
- We paid off all consumer debt in 6 months
- It took another 30 months for us to pay off all business debt.
Once our non-mortgage debt was gone, we continued to follow Ramsey’s plan and started to divide our efforts between mortgage pay-off and savings and investments.
- We saved an emergency fund to see us through 3-6 months of income loss.
- Next, we increased our long-term investments to 15% of our gross income.
- At the same time, we paid as much extra as we could manage against our mortgage every month, to a maximum of double payments.
- All the while, we purchased without debt – even for big ticket items like a new roof and a renovation for DH’s home business office.
Our trajectory was to be debt-free by June of 2019, but an inheritance moved that date up to September of 2018 – just under 2 months from now.
What kind of renovations does our house need?
Great news for the cause of debt-freedom! But I’m going to guess that in general, people who focus on paying off their homes do not focus on home-upkeep – making post-mortgage item #1 a little home-TLC – or a lot of it.
We had a real estate agent come to our house a couple of weeks ago. DH and I are considering a move in a few years, and we wanted to know what we’d need to do to get our home sale-ready if we go that route. “This screams 90s,” she said more than once as we gave her the grand tour. She’s a straight shooter.
If we’re going to put our house up on the market some time in the next few years, we’re going to have to bring it into the not-so-new-anymore century and millennium. Furthermore, there are things that need fixing and a basement to be finished. DH is a handy man, so he’ll be able to do much of the work, but not all of it. Here’s our to-do list:
- Paint every room in the house light grey. DIY – DH will do it. (I would help too, but he won’t let me. DH is a perfectionist about these things – which is good. I, alas, am not a perfect painter.)
- Paint cupboards and trim white. Some DIY, some not. (This will be massive!)
- Correct a drainage issue for our exterior stucco and re-paint it. Not DIY
- Ceramic tiles in laundry room and bathrooms. DIY
- Replace sink and cabinets in powder room. DIY
- Fix plumbing of our en-suite bathtub. Not DIY (DH has tried without success.)
- New carpeting upstairs. Not DIY
- Sand, darken, and re-finish hardwood of living room/dining room. Not DIY
- Complete basement renovations. DIY
That’s a pretty daunting list, but here’s the thing: with complete debt-freedom, it’s all entirely doable! Over the 6.3 years of our journey to debt-freedom, we will have put an average of $41,000 per year against our debt. These renovations, spread out over a few years, will come in at nowhere close to that amount. It will be no small deal, but the burden of renovation-payment will be way less than the burden of debt-repayment has been.
Are our plans set in stone? Not at all! We’ve learned over the last 6 debt-reducing years that we function best with a plan in place, but we’ve gained more freedom in choosing our plan. Retirement is now much closer on the horizon for us than it was in 2012 when, weighed down by our debts, we saw its approach with some dread. As our complete debt-freedom becomes reality, that dread has been replaced by new dreams that have surfaced for us. We now have the freedom to make plans to allow those dreams to take shape.
It’s a new stage of the game, and the truth is it’s strange to be here. But I’ll adjust!
If you have a mortgage, do you focus on paying it down instead of upgrading your home? Have you even done renovations that you’re still paying for? If you plan to buy a home, how do you see yourself balancing the mortgage with “home improvement”? Your comments are welcome.