Howdy, and welcome to Melooley.com. I write about a little bit of everything, but some of my greatest blogging inspirations are Personal Finance bloggers. People like MrMoneyMoustache and Ramit Sethi, people willing to bare their financial souls in public–so let’s give it a shot, myself.
In this post, I reveal our net worth, as of November 2018. This includes my husband and myself–I have a bit more savings than him; he has a bit more student debt than me; we both share a mortgage on a trailer house in Colorado. We’ve generally combined our finances since we got hitched in 2015, but we do still both have personal bank accounts. It works well for the two of us.
OUR CURRENT FINANCIAL STANDING
We owe about $44K on student loans, and nearly as much for our trailer house–which is on land that we rent, not own. It’s a weird combination, but for us, it gives us the best of both renting and home-ownership… although sometimes it’s more like the worst of both worlds. Our landlord can dictate what we do with the land–like not having chickens, a personal pet peeve (pun intended) of mine, and has approval rights over changes to our yard, but it’s vastly cheaper than purchasing land in this area. We have no property taxes, which basically cancels out the cost of renting our lot each month.
We both have retirement accounts, although soon he’ll have one more. (I’m setting up his Roth IRA for his birthday, so sssshhhh, don’t tell him.) I’ve worked in public schools, and he works for the state, so we have access to Colorado’s public employees retirement accounts program, managed for us. I currently have more than him, but I no longer work as a public employee, so he’ll soon overtake me.
All together, our net worth is… drumroll… Negative $52K. That’s really not that bad, with around $80K in debt. That includes our vehicles as assets, but not any value from this fine single wide trailer house–since we probably won’t get much for it when we move (hopefully) to a site-built house someday. Trailer houses really are like cars, in a lot of ways. Available for under $50K, but depreciate like mad as soon as you sign on the dotted line.
Unfortunately, mobile homes don’t typically get the same loan terms as site-built homes. Chattel loans are far more common, with low down-payments combined with high interest rates. Our interest rate on our mobile home is 9.5%, far more than we could’ve found for a site-built home in this area… but again, we had to consider property taxes and all that. The faster we pay off that debt, the better the deal for us overall.
By most reasonable debt-reduction strategies, we should be prioritizing the mortgage and be done paying 9.5% interest as quickly as possible. Unfortunately, our mortgage lender isn’t high-tech enough to have an online account–seriously, we still have to mail them checks every month–so we can’t link them to our Mint.com account. In fact, we still mail them requests for updates to our total loan amount, and wait patiently for the written response to arrive. We always pay more than the bare minimum, but I’ve been underemployed for a few months, so hopefully we’ll be ramping up our payments in the next few months.
According to Mint.com, our net worth has been increasing by approximately $500 every month for the past year or so. This mainly accounts for paying down the student debt, but hopefully soon it will also include gains in our overall savings. We’re putting 35% of our after-tax income towards debt, including mortgage, so a significant portion of our expenses go towards interest, and not towards increasing our net worth, but that’ll definitely change once we get more debt paid off.
OUR FINANCIAL GOALS
Long story short, my car was declared totaled due to hail damage earlier this year. We got nearly $5000 from the insurance company, AND I’m still allowed to drive and insure the vehicle. We put the entirety of the insurance check towards student debt, because that allowed us to pay off all of one of the smaller loans. We always pay more than the minimum on every bill, so that particular loan got about $100/month, and it just feels amazing to not have to pay that anymore. We live in a state where it’s legal to drive “non-salvage” totaled vehicles, so I can continue my goal of driving this car as long as vehicularly possible.
Neither my husband nor I owe anything on our cars, other than standard annual expenses. Ideally, I’d like to “pre-pay” our next car by making monthly payments into a savings account, with the goal of just paying cash for our next vehicle. Hopefully, this will be in the far future, so we’ll have plenty of time to save up for buying a car without a loan.
Beyond that, financial goals include maxing out our individual IRAs–the limit has been raised to $6K for 2019, which we both hope to meet. Heck, to be honest, if we add anything to our IRAs, it’ll feel like a success. Maxing them out is a fantastic goal for our first real year of consistent IRA contributions, so we’ll see how well we do.
Of course, our final financial goal is to maximize our debt payments and work towards eliminating both student debt and mortgage as quickly as possible. As mentioned, we always pay more than the minimum, but right now we’re on schedule to get these suckers paid off in a decade or so, and I’m a bit too impatient for that. I want to pay off debts completely ASAP, so that makes up our final goal.