Category Archive: Debt Reduction

Paying Off Our Mortgage – Update For February 2017 With Chart

My wife and I are working to pay off our fixed-rate, conventional, fifteen-year mortgage.

Our goal is to eliminate our mortgage debt in less than 10 years.  We have been paying off our mortgage for 7 years now – and it’s cool to see more and more of our monthly payment go towards our principal.

 I use a simple pie-chart to track our progress – and post our updates here at No Credit Needed. Having a visualization keeps us motivated!  Here’s a chart with details for our current progress –


The percentages above represent the amount of our mortgage we have paid – 42% – and the amount we still owe – 58%.

Our process is pretty simple –

We make our regular, monthly payment on the first of each month.

We make an additional, principal-only payment on the fifth of each month.

On the fifteenth of each month, if we have managed to earn or save any money, we send and additional, principal-only payments.

Payments are initiated via our online bank, and a notation of “principal-only” is included, when applicable.

This chart doesn’t represent our entire equity;  it represents the amount we still owe on our mortgage.

Thank you for patience between regular posts.  We’ve had an exciting but busy few months.

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Get Out Of Debt – Quick Tips

I love hearing stories about how folks are getting out of debt – and living debt free!

Several years ago, my wife and I paid off all of our consumer debt – and we are now in the process of paying off our mortgage.

I created an illustrated guide for debt reduction – t0 show the process that we used to eliminate our debt.

Here are few quick tips which have helped us reduce – and eliminate – our debt.

1.  We make plans – and stick to them.  Here’s our simple, one-page plan for eliminating our debt.  Day after day, month after month, and even year after year, we keep plugging along.

2. We make all minimum payments – and then we make multiple, principal-only payments, throughout the month. These micro-payments keep us “in the game” and involved in our finances, daily.

3. We make our minimum payments as soon as possible.  This reduces our average daily balances, thereby reducing interest charges.


4.  We apply any extra income (including refunds, gifts, or bonuses) towards our debts.

5.  We search for ways to reduce interest rates – including transferring balances from higher-rate cards to lower-rate cards – and refinancing our mortgage.

6.  We look for ways to shift money from our “spend” categories into our “debt reduction” category.  I’ll call all of our service providers (cell phone, satellite, internet, etc.) and ask for discounts – and I’m constantly looking for ways to reduce monthly spending (via coupons, bargains, sales, or bartering.)  Any money saved can then be allocated towards debt reduction.

7.  We remind ourselves of our long-term goals – We want to be completely debt-free, own our on home, and enjoy retirement.  We are working towards these goals – and feel confident that we will achieve them.

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Thanks for checking out No Credit Needed.  Please subscribe to No Credit Needed via daily email or rss – and follow me via Twitter and Facebook – for future content.  Blessings.

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Get Out Of Debt – The Emergency Fund

I recently wrote about our debt reduction process – a simple one-page guide to getting out of debt.

Over the next few days, I plan to elaborate on each of the steps mentioned in the article, starting today with a few notes about step 1 – and the emergency fund.

My wife and I have our primary checking account with our local bank.  This allows us to deposit our paychecks locally – and is a great place for my son to find coins for his collection.  The account is interest bearing and is free.

Our saving account is online – and that’s where we keep our emergency fund.  Withdrawals from our checking account and deposits into our savings account take place each week, easily initiated from our online bank account.  We can easily track our account balances via our online bank’s phone app.

emergency fundWhen getting out of debt – before we started aggressively paying off our debt – we worked hard to fund our beginner’s emergency fund.  Our goal was to keep a minimum of $1000 in the account, at all times.  We managed to keep between $800 and $2000 throughout our process.

The emergency fund helped us cover unplanned-for expenses – and helped us avoid adding to our credit card balances.  We dipped into the emergency fund, if memory serves, twice during our debt reduction process.

Both times, we paused our debt reduction (while still making minimum payments, obviously) and rebuilt our emergency fund.  Cash reserves were (and are) that important to us!

After getting out of debt – and prior to the purchase of our first home – we worked to save six-month’s worth of salary in our emergency fund.  We used the same “method” for savings as we did for debt reduction – but this time – the “extra payments” were going into our savings account.

When we purchased our home, we used a small portion of our emergency fund to help with our down payment.  We did this to avoid PMI.  After purchasing our home, we rebuilt our emergency fund.

Over time, as we have gotten better at living on a budget and understanding our month-to-month financial needs, we have moved away from a strict “emergency fund” – and more towards categorized “cash reserves”.  In other words, our cash is allocated, on paper, for future purchases and long-term goals, plus emergencies.

Our emergency fund provided a lot of comfort during our debt reduction process – and continues to help us as we work towards total financial independence.  Thanks for reading – and have a blessed day!

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