Monthly Archives: August 2012

Georgia Sales Tax Holiday 2012 August 10 – 11

This Friday and Saturday, Georgia shopper’s can take advantage of the state’s first sales tax holiday since 2009.

According to the official Sales Tax Holiday Fact Sheet - available as a PDF on the Georgia Department of Revenue website –

During the August 10-11 sales tax holiday, the following items will be exempt:

Clothing (including footwear) with a sales price of $100.00 or less per item

Single purchases, with a sales price of $1,000.00 or less, of personal computers and personal computer-related accessories

General school supplies to be used in the classroom or in classroom-related activities with a sales price of $20.00 or less per item

My family and I live in Georgia and I’ll definitely do some comparison shopping this weekend to see if we can snag some deals.  The last thing that I want to do is make an impulse buy simply for a tax break.  I was pleased to see that “helmets” are on the list of tax-exempt items – so I’ll be on the lookout for a new baseball helmet for my son.  I coach his team an we can always use extra gear.

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Mortgage Payoff Progress for July 2012 with Chart

It’s that time again – time for an update on our mortgage payoff progress.  As a reminder – My wife and I have a conventional, fixed-rate 15-year mortgage.  Also, yesterday, we finalized the process of reducing the interest rate on our mortgage, and re-amortized our loan.  So, our August 1st payment was the last payment made under the old interest rate – and the September 1st payment will be the first to be made under the new interest rate.

My wife and I purchased our first home back in February of 2010. Since then, we have been working hard to reduce our mortgage principal and payoff our mortgage early.

Our goal is to pay it off our mortgage in less than ten total years.

As of August 1, we have made 29 regular monthly mortgage payments. We have also made several additional principal-only payments.

Our mortgage payment is drafted from our primary checking on the first day of each month. Additional principal-only payments are made throughout each month, as we earn additional income and find ways to decrease budgeted-for expenses.

Here is our most recent chart –

 

The chart shows two percentages.

The blue percentage is how much I still owe – the balance.

The red percentage is how much I have reduced – the paid.

Now that we have lowered the interest rate on our mortgage, a larger percentage of our regular monthly payment will go towards principal, which rocks.  Also, if we continue to make our old payment, we’ll pay of our mortgage even sooner, which rocks, too!

We are still sending extra, principal-only micro-payments. (Unlike credit card companies, our mortgage provider does not apply micro-payments throughout the month. Instead, all payments are processed on a single day. However, we send them in, throughout the month, because we like a “hands-on” approach to debt reduction. Being mindful, daily, helps to keep us motivated and focused.)

This chart does not represent how much of my house I actually own. It simply reflects how much of our mortgage balance we have paid.

We have made 29 regular payments and have lived in the house for a little more than two years. Our contractual remaining term is 12 years and 7 months, but our actual remaining term is 12 years and 2 months. We have reduced the length of our mortgage by 5 months!

View all post related to our mortgage payoff progress.

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Lowered The Interest Rate On Our Current Mortgage

I have just completed and mailed the paperwork necessary to lower the interest rate on our current mortgage.

As I mentioned just a few days ago, my wife and I have been considering refinancing our mortgage.  Interest rates on a 15-year fixed-rate mortgage are significantly lower now than they were when we financed our home nearly three years ago, so we decided to do some research.

We contacted several mortgage lenders and brokers – and were impressed by the rates we were offered.  I was hesitant, however, to go ahead with the refinance, for three reasons.  First, I really didn’t want to deal with the paperwork and documentation required for a refinance.  Second, I really, really didn’t want to start over with a full, 15-year mortgage.  We have worked hard to pay down our mortgage – and giving up nearly three years of progress just didn’t sit well.  Third, I really, really, really didn’t want to pay thousands of dollars in closing and other costs.

I remembered reading an article about recasting a mortgage and wondered if we might be able to do something similar.  I contacted my current lender and asked them if they offered an in-house refinance – one that would lower my interest rate but not change any of the other terms of our mortgage.  I talked to a customer service manager – and she quickly emailed me with an offer.

The interest rate on our mortgage will be lowered by 1.525%!

Over the life of the mortgage, we will save thousands of dollars in interest – and – if we continue to pay our “old” payment on our “new” loan – we’ll save on interest and pay off the mortgage sooner.  Win – win.

We did have to pay a processing fee, via certified check.  It will take about 7 months in saved interest to cover the cost of the fee, but after that, we’ll be ahead of the game.

The paperwork was rather straightforward.  My wife and I had to sign the new agreement, have it notarized, and overnight it to our lender.  It should arrive by tomorrow and we should be good-to-go for our September payment.

One note – This was not a government-sponsored loan modification or some other hardship-modification.  This was a simple, in-house loan re-amortization and was available because we have made all payments, on-time, and maintained good credit.

I’ll let you know if we hit any snags in the next day or so – and tomorrow I’ll have an update on our current mortgage payoff progress.  Rock on.

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Quickly Fund $1000 Emergency Fund

When my wife and I decided to get out of debt, the first thing we did, after creating a zero-based budget, was to fund a $1000 emergency fund.  We then put our credit cards in the back of our wallets – and began the real process of paying down our debt.

Open a savings account.  If you don’t already have a savings account – now’s the time to open one.  Personally, I’m a big fan of both the Ally Bank Savings Account.  An online savings account allows for easy access to funds – and easily connects to your local bank for transfers.

Have a garage or yard sale.  I know it sounds a little old fashioned, but a garage or yard sale is a great way to make a few extra dollars.  We have a yard sale every year or so – and we usually make between $200 and $500 dollars.  Plus, it’s a great time to rid yourself of some clutter.

Scrap some stuff.  A few months ago, I helped a friend carry some old junk metal to the scrap yard.  I was shocked by how much we made – especially when they gave us a pretty decent amount for an old, broken treadmill.  You may even have neighbors who will pay you to take their junk – and you can then scrap it.

Remember eBay.  I was looking at my eBay account the other day – and was shocked to see that I’ve been a member since 1999.  Wow.  Back when our kids were younger, I managed to make a decent amount of money selling baby clothes on eBay.  The selling system on eBay is much more user-friendly than it was years ago – and it’s still a great place to get rid of stuff you don’t need.  (I know that lots of folks use other sites to list items for sale, but eBay is the only site that I’ve used.)

Find a temporary second job.  I am married and have three kids, so it’s difficult to find time for extra work.  However, over the years, I’ve managed to find odd jobs – usually involving work online – to supplement my income.  In fact, this very site is a supplement to my regular job.  If getting out of debt is important – finding extra work will be, too.

Scrounge for change.  This one is actually kinda fun – especially if you have kids.  My son loves to look for change, around the house, in the van, even in my golf bag.  Take a few minutes, dig around, remember when you used to be able to put 5 gallons of gas in the tank for 5 dollars worth of quarters, and see what you can find.  You might surprise yourself.

Return stuff.  Did you make an impulse buy?  Then, make an impulse return.  If you have your receipt and the item is unused, you’ll get your money back.  Obviously, abide by each store’s return policy – but don’t leave stuff in your closet, with tags, just because you are too lazy to take it back.

Analyze your monthly bills.  This one is easy.  Take a look at your monthly cable, satellite, telephone, and cellphone bills.  Either discontinue service, call for discounts, or change plans.  Do this often!  Remember, any monthly savings is deposited in to our savings account.

Create a savings-transfer routine.  This is critical.  Do not simply automate your savings – be intentional.  Once or twice a week, transfer any amount that you have saved into your online savings account.  Get connected with the process – it will mean more to you.

On several occasions, especially early in our debt reduction process, my wife and I had to use funds from our emergency fund.  We always took the time, even in the middle of our debt reduction, to rebuild our emergency fund.  We managed to avoid the use of credit cards – and soon found ourselves debt free.

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