Friday, July 1, 2011

Net Debt- July 2011

Student loans: -$77,809.34
Car loan: -$3,836.49
Revolving Credit card debt: $0.
Mortgage: -$139,228.54

Net Debt: $220,874.37

It has been several months since my last net worth update and you'll likely see some dramatic changes that have happened in these numbers. So, let me explain a few things from top-down.

The student loans have been on deferment so I haven't made any payments to those; however, I have another 4 years or so left in school. So I will likely try to pay off at least some of the higher interest loans that are sitting at 6% and of course pay the interest while in deferment so it wont get added into the total again once I graduate.

Next the car loan. I was a naughty boy; I got into an accident and it was my fault and sadly, I totaled my beautiful car. Although I was starting to save for a new car, I didn't have enough saved at the time to purchase a car, hence the car loan. The car we did purchase though, I did extensive research into in regards to recalls, overall cost of ownership, mpg, etc. and will hopefully last a long time and save us some substantial money (over the life of the car) as the previous car was a gas guzzler. Likewise, you can see the loan amount is small, I'm hoping to have it completely paid for by the end of this year. Once it has been paid for, I will begin the process of saving for another car, hopefully save $12,000 or more and get a reliable car when needed.

Lastly, we purchased a home! Yay! We love our home and the mortgage principle and interest is actually less than the rent, however because we only did 3.5% down, we have a larger monthly than our rent due to the taxes, escrow and insurance along with all of the other prepay things. :-(

I am a bit disappointed with myself because we didn't pay 20% down, but I'm not sure when we would be able to save 20%. The home we purchased, as you can see wasn't an overly expensive home, and we plan on living here for AT LEAST another 5 year or so until my wife and I both finish our Ph.D.'s. Afterwards, we are hoping that we'll both be able to find a job locally, however, we are prepared, if necessary to sell and move.

However, I don't care much because we now have the freedom of doing what we want in our home. It is an energy star home (I'm too green not to go energy star) so our utilities seem to be staying around the same even though there is a lot more space in the home than the apartment.  We've also retrofitted in water saving devices into the home like the aerators and shower heads which  you can see all of those things in my previous post on how to save money, water, and the environment.  Likewise, because it is my own home I can do a lot more car repairs and maintenance at home saving us additional money!

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