When Will You Celebrate "D-Day" (Debt-Free Day)?

[katmai]

I seem to get money every month and it seems to accumulate over time.

Aren't we special.

[The Brain]

I seem to get money every month and it seems to accumulate over time.

Aren't we special.

ty

[Caliga]

Most: I will deposit my pay into my chequing account and, on my own, divvy it out into various payments and savings. Look, I have a budget on my spread-sheet ... !

This would be us, as well as my parents, bro, and most of the rest of my family.

None: savings? What's that? I'm on my way to get a payday loan, there's a party tonight!

This would be most of the other people in Princesca's family.

[KRonn]

My mortgage has a ways to go but I'm paying it off faster on an accelerated payment program. Thiry year mortgage but should be paid off in about a dozen years. I could pay it off a lot sooner if I decide to do that when I retire, which should be withing five years to retire. Depends on how things look when I retire.

[CountDeMoney]

Let's see should be debt free by Nov of 2013, but then thinking i need a new car as of 4 cars have the newest is 1993

You still driving that little 4 cylinder hoopdie you brought to Pennsylvania that one time?

nope, but it is still sitting in my driveway.

Kudos for trying to keep that fucker on the road.

[Berkut]

Mortgage refi rates are now well below 4%. It is simply insane.

I almost wish I owed more on my house so it would make sense to re-finance.

[katmai]

Let's see should be debt free by Nov of 2013, but then thinking i need a new car as of 4 cars have the newest is 1993

You still driving that little 4 cylinder hoopdie you brought to Pennsylvania that one time?

nope, but it is still sitting in my driveway.

Kudos for trying to keep that fucker on the road.

thanks, i have an '87 GMC Sierra pickup with plow on it for my real old vehicle.

Would have a '62 ford pickup to fix up if it wasn't stolen

[Martinus]

It seems like a bit of a drastic move.  I find it easier to just allocate higher percentage to 401k.  That allows me to save passively without being tied down by a major lifestyle decision.

I don't have enough time and nerve to play the stock market (plus with my job, it's exceedingly difficult, as we need to jump through all sorts of reporting hoops every time we trade stocks, since our firm has access to a lot of confidential information), and since the last stock market bust I don't trust various savings plans that are based on someone investing my money for me (I know people who started saving that way in 2001 and now have half of the money they put in).

From that perspective, I can either put my money into foreign currencies and bonds, or I can put it into mortgage. The mortgage seems a better investment (although, admittedly, I put about the same amount into bonds and deposits each month as I pay as mortgage as I don't want to find myself without cash suddenly).

[Syt]

I'm debt free, and pay my bills on time, including credit card.

I don't own property or a car, though.

[Martinus]

I'm amazed that (a) anyone would be dumb enough to take out a mortgage for "half their income" (I assume you mean their monthly payments are half of their income), or (b) that a bank would lend out that much.

I know lots of people whose mortages are half their income and they are actually pretty intelligent people in most ways.  It just amazes me.  However they are mostly single people who are in that situation...still that strikes me as a disaster waiting to happen.

Ours is 28% and frankly I think that was too high.  The final one I will shoot for more like 20%

My mortgage is about 25% of my income after taxes. Another 25% I save. About 15% is used to help my parents (mainly with the costs of maintenance of their house which I stand to inherit so it could also be considered an investment). The rest goes to costs of living etc.

[Iormlund]

I'm amazed that (a) anyone would be dumb enough to take out a mortgage for "half their income" (I assume you mean their monthly payments are half of their income), or (b) that a bank would lend out that much.

Now, obviously that isn't a good idea. For one, mortgage rates are at a historic low, they can only go up, and if they do and your rate isn't fixed you are truly fucked. For another, even if that wasn't true, half your income is way, way too much. The usual limit I've heard is around 30% of one's gross income, and even that is too much in my opinion.

The banks were not supposed to lend over 30%, yes. They did so anyway. Why not? Those doing so were mostly politician-led regional savings institutions and there were not answerable to shareholders. And in any case, in Spain lenders own your ass and will get anything beyond minimum wage for the rest of your life if you fail to meet payments.

As for the borrowers, in dysfunctional renting market with rents costing as much as mortgage payments and interest rates well below inflation, it is no surprise pretty much everyone bought a place, price be damned. After all, prices would always go up!

That being said - the fact that some people are borrowing way, way too much isn't really a critique of borrowing at all, is it? That's like saying pencils are bad because some people stab themselves in the eye with them. 

I was responding to Martinus' claim that anyone that doesn't have a mortgage is some kind of failure.

[Grey Fox]

26% of my net income. Banks loan on Gross income tho.

[Duque de Bragança]

I am like the Germans here, no car and I'm renting. Not a fan of credit as well.

[Baron von Schtinkenbutt]

I'm amazed that (a) anyone would be dumb enough to take out a mortgage for "half their income" (I assume you mean their monthly payments are half of their income), or (b) that a bank would lend out that much.

Ours is 9% of our combined gross, and 20% of the lower single gross.  I could get it even lower if I had another 10% equity.

When we went in to pre-qualify at BoA the loan officer was trying to convince us to go for nearly double what we wanted qualification for.  My wife and I both thought she was nuts.

[CountDeMoney]

When we went in to pre-qualify at BoA the loan officer was trying to convince us to go for nearly double what we wanted qualification for.  My wife and I both thought she was nuts.

I bet she was pushing that shit hard.  That's how they make their money, rat bastards.