Favourite Quote

The Road goes ever on and on Down from the door where it began. Now far ahead the Road has gone, And I must follow, if I can, Pursuing it with eager feet, Until it joins some larger way Where many paths and errands meet. And whither then? I cannot say. J.R.R. Tolkien

Thursday, June 01, 2017

House Repair and Debt Consolidation

My water heater failed about two months ago. Due to the setup of my heating and cooling system this meant I had no hot water and no heat. The system was probably 20+ years old. It also handles my air conditioning (which failed completely about 3 years ago). So, I had the tough decision about what to do.

After getting lots of different quotes and speaking with my dad (in the business of heating and cooling for many years), I decided to replace the entire system - hot water tank, heating system, and cooling system. This worked out to about $12 000. I don't have $12 000 lying around.

I talked to the bank, there is a ton of equity in my home (worth about $350, I owe about $160). They are willing to add the cost to my mortgage, but I also need to include my line of credit ($10 000) and my car loan ($10 000). This sounds good to me, lower rate at least.

So, I did this and now I have one monthly payment and one place to look at all of my debt. So, I'm trying to put the money I had set aside for debt repayment as a payment on my mortgage. But, I don't know what happened. This was true for a couple of months, but now I seem to not have the extra set aside. I don't feel like I spent more in the last couple of months.

But, this month I owe $700 on summer camps (next month as well) and my cat had to be put down ($300). So, it was an expensive month.

Plus, I had put my yearly bonus and tax return against my line of credit. So, I no longer have access to that extra money for this year, which would have been used to help on the summer camp.

But, on a happy note: my debt (including my mortgage) is $186 000, and my house is worth $350 000 (not that I could afford to move - as nothing would be available for that). It's nice to have one number in one place. I only have about $16 000 in investments, but it is something and it is growing.

I am hoping to get the debt back down to $160 000 in the next two years and to increase my emergency fund as much as possible in that time. Once I've got the debt back to where I want it to be, I'll increase my emergency fund, and once that is where I want it, I'll be upping my savings. I'm not in the financial shape I'd like, but I'm getting there.

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