Pay Down the Mortgage vs. Investing: Rockstar Finance Money Match-up

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Our Financial Path and I had the opportunity to square off in Rockstar Finance’s Money Match-up. The Money Match-up is a series at Rockstar Finance where bloggers debate two different sides of a money related topic.

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Our topic discusses paying extra on a mortgage versus investing the excess funds elsewhere. I took the side of paying extra on the mortgage. If you’ve been following my story you know we’ve been aggressively paying down the mortgage for the past 2 years.

Pay Down the Mortgage vs. Investing: Rockstar Finance Money Match-up

The reasons to pay down the mortgage include:

  • behavioral aspects,
  • guaranteed return on investment,
  • decreasing monthly expenses (when the mortgage is paid),
  • protection against a recession, and
  • not being tempted to spend the extra money instead of investing.

Overall I believe that paying down the mortgage is more beneficial if you are seeking peace of mind and financial freedom. If your goal is to get as rich as possible as fast as possible, then I understand the argument of investing instead. However, this approach also comes with additional risk. Overall, Our Financial Path makes several good arguments to invest instead of pay the mortgage. It’s just not my preference.

Please check out the article and let us know which side you fall on. This tends to be a very personal topic and can ignite a lot of passion. My wife and I have been on both sides of this argument as well. Only recently did we move to the side of paying down the mortgage aggressively.

In the end, if an someone is in position to either make extra payments on the mortgage or invest the excess funds then they are likely doing very well financially. With the majority of Americans barely scraping by or living paycheck to paycheck, those of us fortunate enough to be in this position should be grateful.

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Want to learn more about my story?

Check out my interview with Scott at Making Momentum.

Fourth of July, Paying off the Mortgage, and FinCon

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When I started this blog a little over six months ago it was primarily to stay motivated while paying down our mortgage. Paying off debt is really boring and something needed to be done to keep from doing something crazy like buying a new house we didn’t need. Like most bloggers, I came out of the gate full steam and have since slowed a bit. I’d like to attribute that to the summer lull, work being busy, life with two kids, coaching two baseball teams, and a variety of other excuses. The reality is that we have time for anything we want, just not everything. This is a whole other topic, so I’ll digress at this point. Regardless, I am learning so much blogging, developing relationships with other like-minded individuals, and am so excited about attending FinCon in September.

My favorite thing so far about blogging is the community of personal finance nerds like myself who are focused on spreading financial literacy and improving the financial lives of others. Getting people to think differently about money will require an army of content providers to make a small dent when faced with the competition of billions of dollars in targeted marketing dollars everyday. This small but mighty militia definitely seems up to the challenge. Continue reading “Fourth of July, Paying off the Mortgage, and FinCon”

Review of Dave Ramsey’s Financial Peace University

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Financial Peace University

After following the Dave Ramsey baby steps for nearly seven years, my wife and I decided to take the Financial Peace University (FPU) course through our church. We completed our final lesson a few weeks ago (mid-March 2018).

We were introduced to the concept of becoming debt free from Dave Ramsey in 2011 by reading the Total Money Makeover. Even though we have been on this debt pay down journey for years it was refreshing to go back to the basics in Financial Peace University and see first hand how other people react to Dave’s philosophy.

Dave Ramsey has been more successful than just about anyone to encourage a diverse audience to eliminate debt and live a more purposeful life. There have been many conversations in the personal finance community about how to better reach the low to moderate income population. My suggestion would be to start with Financial Peace University. Dave is effective in rolling out basic personal finance principles such as budgeting in an inspiring way.

Dave uses a seven step approach to eliminate debt known as the baby steps. Once you become debt free (baby step 2) and save up a three-to-six month emergency fund (baby step 3), people can usually start moving to more advanced personal finance guidance. For example, in baby step 6 the goal is to pay off the mortgage. Even though we have decided to pay off our mortgage, the same may not be best for others depending on an individual’s unique set of circumstances (my opinion, not Dave’s).

What is Financial Peace University?

Financial Peace University is an interactive 9 week course facilitated primarily by weekly videos featuring Dave Ramsey. While you can purchase the course material and take it on your own, I’d highly recommend seeking out a small group to go through the course together. The real magic of the course comes through the small group discussions which also creates accountability. It’s similar to the Weight Watchers approach  that creates a small community of individuals who hold each other accountable. After all, personal finance and weight management has similarities. The overall concepts are simple but the actual doing is hard. Continue reading “Review of Dave Ramsey’s Financial Peace University”

Early Career Benefits of a 9 to 5

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The Benefits of a 9 to 5

Escaping the 9 to 5 job is a fantasy for many individuals in pursuit of financial independence. Many do not want to waste away in a cubicle staring at spreadsheets all day. And really, who can blame them? Why would you want to work for someone else’s dream when you can work for your own? If working for yourself is a dream of yours down then road this article will share a few advantages of starting your career at a 9 to 5.

Many organizations are starting to offer flexibility to align the traditional 9 to 5 with the up-and-coming gig economy. Organizations are realizing that millennials, who now make up the majority of the workforce, like to work differently than previous generations. Organizations who adapt to the changing desires of the workforce will be more successful in the long run simply by attracting top talent. Millennials tend to favor flexibility and purpose over job security and even money.

With that being said there are still many organizations where the 9 to 5 hasn’t yet adapted to the new generations. Regardless, there are several benefits that may make that 9 to 5 job worthwhile, especially early in your career.

Growth and Development Opportunities

There is a huge difference in the person I am now compared to 11 years ago when entering the workforce. Much of my growth during the past nearly 11 years can be attributed to on-the-job experience.

I came out of graduate school as a timid and inexperienced person with much to learn. A few of the skills I have developed over the past 10 years include: Continue reading “Early Career Benefits of a 9 to 5”

2018 Goals: Saying Goodbye to the Mortgage

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2018 Goals: Saying Goodbye to the Mortgage

If we are able to achieve our 2018 goals it will be a very exciting year for the Financial Pilgrimage household. Our goals range from personal to professional, with an emphasis on getting the remaining balance on our mortgage paid down ($31,000 remaining as of December 31, 2017).

I’ll save the lecture on the importance of goal setting for another day. If you’re interested in my thoughts, you can read the recap of our 2017 goals. Now let’s jump right into our list of goals.

Goal 1: Pay off the Mortgage on our Personal Residence

This is the big one. We’ve been paying down debt since 2011 and it’s surreal to think that we should be able to pay off our mortgage in the next few months. All of our extra money is going towards the mortgage at this point. By minimizing lifestyle inflation and paying down all other debt, we have been able to make a huge dent in our mortgage that started out at $123,000. Continue reading “2018 Goals: Saying Goodbye to the Mortgage”