We all want to be mortgage free but how many of us actually have a plan. A plan is not, wouldn't it be cool if I was mortgage free, or, I'll be mortgage free when I die. A plan is a list of track-able and accountable steps required to achieve your goal in the time frame you choose. You may need some help from your friendly mortgage specialist as an adviser and accountability partner!
In doing so you are likely to save 10's of thousands of dollars in interest and live much longer as you will experience less stress in your life. It's a win win and can be done without completely changing your world. Instead just start to introduce some very simple exercises twice a year.
Yes this is when the "B" word comes in, BUDGET. Now before you panic, I'll be the first to admit I don't follow a budget on a daily or even monthly basis. I do follow a budget I set twice a year and I check it twice a year to make sure we are on track. If you can do the budget weekly that is fantastic, but you have to be realistic. If you are not a budget person then there is no sense setting yourself up for failure, start slow.
A semi annual budget gives basic parameters that keep you on track and spending within your means. If once you have completed your budget you decide you have even $25 or $50 extra a month that you can allocate to debt repayment, do it. But make sure it is automated so that the money is gone and the success is not reliant on you making the extra payment online or even worse at the bank. We are all human, we don't miss what we don't have.
The key here is to start paying a little extra on the most expensive debt you have, like that 18% credit card. Once that is paid off start on the next and so on. This is where the discipline comes in, now that you have all that credit available you have to stay focused and avoid the urge to use it. If you want a holiday put it in the budget and plan for it instead of using the credit card and hoping the lotto comes through to pay it off.
Give yourself an allowance to run the home, groceries, entertainment etc and allocate amounts to each activity. Some people even use a jar for each and when the jar is empty they are done until next month. It's amazing when you can actually see the money, how much more focused you are on making it last. Decisions like, do I by the chicken and cook it, or do I go out for dinner become easier because you can see the money you have left this week or this month.
Share the plan with your kids and involve them, this could be one of the best gifts you ever give them. Kids often don't hear what we are saying because they are to busy watching what we are doing!
The last things is celebrate your success and reward yourself when you achieve bench marks.