I have seen some financial advice along the lines of “wait a long time for big purchases.” I get the concept of this advice but it is more to do with impulse spending. If you are prone to spending on a whim or tend to make a lot of unbudgeted purchases, wait to spend money. This goes for purchases that are big or small. Today marks 5 years that we got the keys to our house and it was the biggest financial decision of our life. I could also say that it was one of the fastest as well. If I think about advice to wait a year on a big purchase I know that for our home it doesn’t make sense. In honour of 5 years in the house I thought it would be interesting to share how we went against that advice and made the biggest purchase in our lives in 4 hours.
The Basement is FINISHED!
After months of finishing touches the basement renovation is finally finished. There are some décor items that still need to be found but that isn’t much of a priority. Several months back I did a post showing the mid-way point of the renovation. Now we are very excited to have a finished area with nice tiles so we don’t need to wear shoes to do our laundry!
We are now in the midst of a renovation break. We have some worked planned to redo the front of the house and possibly our powder room next year depending on finances. Then after that we have to save up to do hardwood on the top floor of our house (and either stain or replace the hardwood on our main floor).
Choices to make as we edge closer to paying off our mortgage
Sarah and I are working very hard to knock out the mortgage on our house as soon as possible. We are on track to be mortgage free by our early-mid 40s. This is depending on what life has in store for us in the next little bit. The reason why we have been focusing on the mortgage is about commitments. Math-wise it makes more sense to invest in our retirement savings. We have RRSPs – and the money we contribute to them lowers our taxable income. That leads to nice tax refunds which we then reinvest. If we ran into any financial difficulties we would stop contributing. We would still have a fat mortgage to pay off. Once we are mortgage free we can then focus on retirement. Currently we do contribute to our RRSPs on a consistent basis. Any extra we come up with goes to the mortgage. While that is our current plan, things might change as our priorities shift in life.
A couple of years ago, Sarah and I decided to do a basement renovation. The ground level floor plan of our house didn’t leave much for living space. We wanted to expand our square footage, and we had this unfinished basement sitting there waiting for some work. The great thing about our situation is that we both are able to do renovation work (yes Sarah can use a drill). We both make decisions on design, and then we both get our hands dirty making it happen. Additions included an entertainment area, a little eating area, a wet bar and a 2-piece bathroom.
The second half of the basement was left unfinished (storage, laundry and furnace room). A few months ago – we started to tackle a renovation on the 2nd half of the basement. One of my big regrets with the first renovation was that we didn’t take pictures of the progress and that is something we corrected this time through. So here is part one of our 2nd basement renovation. Part two will follow once we are finished the area.
A Rant After Paying My Monthly Bill & Hot Water Tank Rentals
So a head’s up that I’m writing this a bit hot under the collar; just need to get this off my chest. That is one of the wonderful things about blogging – it can be just as therapeutic to the writer as it is helpful to the reader. So, that being said – here is a bit of a rant.
In December of 2012 Sarah and I moved into our new home. It was a magical time with a ton of paperwork on closing and several delays before that. If you have bought a home (new or resale) you know the house often includes a hot water tank rental. The term hot water tank rental can be quite deceiving though. The practices of the “service supplier” can be shady at best. I’m not going to talk about the company by name but feel free to DM on Twitter or email me if you are curious.
We have lived in our house for over 4 years now. It’s an open concept townhouse in a prime location, with 3 bedrooms and 4 bathrooms. A finished basement, hardwood and stone counters throughout. Finished backyard with a deck and patio…wait this starting to sound like a listing for the house.
We Like To Move
Did you know that according to a study by comFree 28% of Canadians feel the urge to move every 5 years? We are approaching that mark in our house. I have told family and friends that I don’t want to move right now or at all. Most people look at me with some side eye because we live in a “starter home.” They say once the house gets too small we might change our mind. I’m not so sure about that.
How We Cut Our Telecommunications Bills by Over 40%
Recently Sarah and I sat down and had one of our standard saving check-ins. Our financial situation was stable but there was a potential hiccup coming down the pipes and we felt it was better to be proactive and make some changes. We went line item by line item with precision until we hit our telecommunications line item. This one was going to be tricky. Sarah and I see eye to eye on the big picture stuff, we both knew we needed to cut this bill down for some extra savings. Where we needed to talk it out was on each area of our service and how we were going reduce costs I’m not going to discuss our particular carrier, but if you have their services you’ll probably be able to figure it out.
In 2014 we paid over 2 years of property taxes in a single year and we didn’t take on any debt to pay for it.
I wanted to share why that had to happen, how we did that and provide some tips based on what we went through. I want you to avoid some of the pitfalls we have seen others make with their property taxes.
As I mentioned before we purchased our house in 2011 directly from a builder and it closed in late 2012. In the city we live in a new build takes some time to be assessed before the city sends you a property tax bill. This varies from city to city but usually there is a little bit more time for a new build.
To be honest we had no idea that was the case until we heard it from one of the lenders when we were shopping our mortgage rate. He told us of a horror story of a friend of his that needed to pay over $6,000 for property taxes in one year. They didn’t have that money so they needed to take out a line of credit to pay the bill.
After hearing that we also found out that we had two options to pay for our property taxes, let the bank take out the money or pay the bill the directly ourselves.
Doing the renovations yourself to save some dough
Home ownership is a lot of work especially when it comes to maintaining your home or home renovations. You have to pick out your paint colours, figure out the “feel” that you house will have from top to bottom, upkeep the property, change filters, change bulbs, repair, build, replace….it is simply exhausting. If you are reading this blog, chances are you are interested in budgets and personal finance so you aren’t so loaded you can just buy your way through life. Even if you have a list of friends and family in the trades chances are you are going to have to fork out some cash at some point for some work at your house. This is where the Y/Why? comes in in DIY. There are so many things you can do with a bit of elbow grease, a bit of preparation and a bit of inspiration – so why not save some money. I’m going to focus on things that I feel you can do yourself without a degree in design or being a licensed contractor.
Today I wanted to share some steps that we took to cut off 6 years of our mortgage amortization. These steps were relatively easy to adopt and they didn’t make a huge dent to our overall lifestyle but they made a huge impact to our mortgage balance. With no consumer debt (or car loan) we are very focused on doing what we can to reduce the number of years we have our mortgage and effectively reduce the interest we will pay over the course of the loan. Even though in Canada interest rates are at record lows that might not be the case forever and while they are low we wanted to take advantage of this unique opportunity to accelerate our path to mortgage freedom.