April 2013 Net Worth Update- Young and Free, Well Almost Free!
We’re Young and Free, well almost free that is. It’s time to walk the mortgage elimination path for one last time in the next couple of months and kick it to the curb, for good. At least in this house, who knows what the future will hold for us as we would love to own a bit more property than what we currently own. The problem is do we want to take on another mortgage to do so or opt to move a smaller city or town where housing is much cheaper than in the GTA?
Last month in my March Net worth update I told you that we pre-paid the remainder of the 20% of our mortgage that we were allowed to do. Just this past week our mortgage pre-payment schedule reset for the 2013-2014 year which enabled us to put a further 20% down on the mortgage which we just did. Yes! You won’t see that reflected in our Net Worth update until next month though I’m afraid as the payment won’t come out until May.
We’re almost there, we can taste the mortgage pay-off victory but we don’t want to get too cozy as anything could happen. This new mortgage pre-payment leaves us with just over $80,000 left on our mortgage for this house which we bought for $265,000 just 4 years ago.
The Exchange Rate
I secretly am hoping the exchange rates will go up but I know in the back of my mind that I have to bite the bullet and suck up the exchange rate loss, maybe even make like the money wasn’t there.
It’s one of those money transfers I should have done years ago but always thought the exchange rate would go up not down the way it has. There is some success in believing you will make more money and another thing when it just turns out to be a pipe dream and you’ve lost what you could have had. It’s just risk, full-stop.
There is no crystal ball so although people say one thing and historical trends say another I’m always on guard because ANYTHING can happen at any time. I’ll just have to accept my loses as the British Pound goes from $2.35 as at 2007 to $1.56 in 2013 on the Canadian Dollar. Once moved we can finish paying off our mortgage and say, adiós!
It’s just another reason why paying off the mortgage makes more sense to us. Even if the housing market makes a predicted 10% correction we’ve kept our house price low for Net Worth to keep it realistic. That way if it does correct it doesn’t bash our net worth to death.
If at any time we had a debt we considered it a bad debt because we felt that owing money means others have control over us and our finances. Maybe that’s the reason we busted our butts to get where we are so we could take back the control we give up so easily when we accept credit, who knows.
How do I find out my debt?
It’s no secret that many people struggle with their finances and what’s easy to one is very difficult to another. It’s just another reason why we are happy with our financial decisions even though we have learned from our mistakes. Having learned about money at a young age set the stage for where we are both today. It’s probably another reason I was so drawn to Eva a 17-year-old who shared her story on CBB about budgeting and the envelope system.
I also received an email the other day from a female who read a small bit about us in the “Paying It Off, How They Did It” story in the Toronto Star and wanted to know how to live a debt free life. The best financial tip I can give is to budget and educate yourself about personal finance and of course, spend less than you earn. Sometimes people are in a unique debt situation where they really don’t know where to start but for the most part all you need to do is gather up all your personal financial information and who you owe money to.
Young and Free, you bet we will be because that’s the life we wanted and the path we set out to achieve our goals.
What Does Individual Net Worth Mean?
Net Worth is a snap shot of your financial health sort of like a picture. It’s a total of the value of your assets minus your liabilities. In April we spent far more on groceries than we would have liked to but the wife is now on a low glycemic diet which means we made a few changes and stocked up on some items to get her going.
How To Determine Net Worth?
Net Worth = Assets – Liabilities
Determining Net Worth is fairly easy as long as you know your personal numbers. Net Worth is simply adding up all your assets (what you own) then taking away your liabilities (what you owe) which will give you a net worth number. It doesn’t get any easier than that.
Do you know how to calculate your own Net Worth? Why not go ahead and calculate your own using our Free Tool Net worth Calculator (Canadian Budget Binder 2012)
Our Short Term Finance/Life/Blog/ Goals 2013
- To pay off our mortgage with-in the 5 yr term ending in April 2014
- Focus on TFSA and other investing
- To Save money for smaller renovations
- Continue to meal plan, create new homemade meals
- To sow and grow more vegetables/herbs in the garden to save money.
- To take vacation somewhere in Ontario this summer
- To take this blog to self-hosted and get a redesign (happening 2013!)
- Learn more about Passive Income
- To Read a new Personal Finance Book
- Learn more about SEO and Blogging
Our Long-Term Finance/Life/Blog/ Goals 2013
- Continuing to educate ourselves on personal finance and investments
- Continue to Network with other like-minded individuals
- To finish renovating our home
- To continue with educational training to further careers.
- To save money for big renovations
- Start thinking about saving for a second-hand vehicle in the next 5-7 years
- Save up for a European Adventure in the next couple of years
- Potentially save for a second home to rent out or build/move to our dream home
Our Financial Numbers
When budgeting anything is possible, we are proof of that although we still have a long way to go in our journey. These are our numbers and our goals, not a means of comparison towards your own goals. We don’t care how much money others make or if their net worth is lower or higher as it’s not a competition. I hope our experiences perhaps will help guide you along your financial path towards debt freedom.
Our April 2013 Budget Update shares the numbers which got us to this point. In April we had to pay our property taxes which was saved in projected expenses. We went over on the grocery budget of $235 which we will make up for in May to keep to our yearly totals. We also had to pay for our water and electricity bill which ran us just under $300 for 2 months of service. April was the month that almost everything has to get paid but overall I’d say we were happy with the outcome.
Now that spring has arrived I’ll be out in the garden more and you will start to see me using up the home maintenance part of the projected expenses up. I’ll be buying lots of flowers for our hanging baskets as well I have to get the yard landscaped this year which will run us into the thousands of dollars. With over $11k in projected expenses we are happy that we don’t have to find a way to pay for these projects because the money is already saved.
Canadian Budget Binders Financial Health
Net Worth For Preceding 12 Months
Net Worth Updates 2012-2013
- March 2012
- April 2012 (+0.94%)
- May 2012 (+1.19%)
- June 2012 (+1.17%)
- July 2012 (+1.51%)
- August 2012 (+1.67%)
- September 2012 (+1.61%)
- October 2012 (+1.91%)
- November 2012 (+0.96%)
- December 2012 (+1.76%)
- January 2013 (+1.39%)
- February 2013 (+0.75%)
- March 2013 (+1.61%)
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- Is Budget Failure Your Own Fault? (canadianbudgetbinder.com)
- Family Finances: Somebody Is Watching You (canadianbudgetbinder.com)
- Should I Rent Or Buy? The Million Dollar Question (canadianbudgetbinder.com)
- Money and Finance: Why I Care About Financial Literacy (canadianbudgetbinder.com)
Photo Courtesy of: Free Digital Photos. Net/renjith krishnan
Great work, Mr and Mrs. CBB. SO happy for you. :-). Good luck on the property decisions. We too are thinking about moving to a smaller town and getting a smaller mortgage in the process.
That’s great news Laurie!! I’m not sure what we will do yet. We don’t want to jump the gun as we know that in an instant everything could come crashing down. We are always watching our steps financially.
You guys are doing great. I love how you pointed out that when you have debt others have control over your finances, to a certain extent. Either way, there is nothing like the true freedom you have when you do not owe any money. Keep moving down the good path even when it’s hard.
Thanks mate, I hope we inspire others to take a good look at their own finances and make decisions that are right for them and not based on what others think or do. Cheers
Wow, you are doing awesome there!!!!!!! Given that you would like more land and a couple of the other points you raised…… one thought is to pay off this mortgage in full…….watch the housing market, if it does drop as the experts say is likely…….then start looking in a smaller town than the GTA as you stated…. the chances are good that you can pick up another house on a bigger plot for close to what you would pocket selling the current house. New house, more land….. paid cash so no mortgage…… It’s a thought…. it’s what my sister-in-law and her hubby did, they sold their one house, it took a few months but they got bridge financing until the first house sold and bought another house….COB once bridging was paid for……
Yes, we’ve been looking around to see what is out there. We don’t have anything holding us where we are and with so many cities surrounding us and easy ways to commute we may look into it further. Who knows where we will end up!! 🙂
Nice progress, Mr CBB! I’ve never once come out on the good side of exchange rates. Feel your pain there. =(
Bloody exchange rate, oh well what can you do.
Another great month. You are almost there. Paying off a house in less that five years is amazing. I know the math that says it’s better to invest, but who ever had regretted owning their house outright? We’re still a few years out, but I can’t wait.
Investing is just as risky but what I do know is it’s better to own the roof over your head first than a piece of paper that says you own stocks that may tank and you’re left with nothing but something to shred. Cheers!
Amazing work with killing that mortgage, and growing your net worth in the process. .
Working on it Mark… I know we aren’t investing like you are but I hope to get to a happy point with investing and balance of my portfolio one day. For now it’s in my advisors hands. Cheers mate
congratulations!! and I can’t believe how regular your NW progress chart is, in spite of all the expenses you have. You are truly doing amazing. I do think like you that the GBP will get a bit stronger, well that the USD and EUR are going to lose value rather, leaving the GBP comparatively stronger. I hope you manage a good rate, it does make a difference on such big amounts.
I kept telling me the pound would get stronger but it hasn’t seemed to go up only down lol.. I’ll just cut my losses and not look back. That’s all I can do or I sit on them and wait… and hope.
You and the Mrs will enjoy the freedom from debt Mr CBB! It will be important to focus on saving for the future though as your next priority, since the days until retirement & the opportunity for compounding income are reducing each and every day. I know I am hardly giving you a moment to enjoy the landmark…I salute the debt freedom but I also encourage you to shift gears and bear down on a “written in stone” approach to retirement investing IMMEDIATELY as soon as the mortgage is paid off…at least the same amount of your highest monthly mortgage payment. All the additional mortgage pre-payment funds and additional payments will more than cover the rest of your wish list. 🙂
Thanks Mary! That’s the plan that we set out with our advisor. Once the house is paid we will work on building the portfolio up to where it should be. Once we hit 100K we also pay less fees…. I forget all he said at this moment but I have the information in a file that I have.
I´m amazed over how much mortgage you`ve paid down over just 4 years! That is just mindblowing!
You are doing awesome!!! That mortgage-payoff date is getting closer and closer! 🙂
Keep up the great work Mr. CBB! It must feel great to have that end to be nearly in site. Nice work as well on the growth in your net worth, seeing that continuous uptrend is always nice to see.
Wow you paid $185,000 in four years, that is impressive Mr. CBB. I’m actually about to pay off all of my credit card debt within the next month or so, but then I’ll be on to working on a mortgage payoff fund. Keep up the great work.
Congrats on the improvement!
Huzzah! Sounds like the end is in site for you! 🙂
Fingers crossed.. it’s one of those don’t count your chickens until they are hatched scenarios lol.