As of fifteen minutes (and one very cold beer) ago, I officially own the beautiful house I’m sitting in right now.
That’s right: I paid off my mortgage early.
My partner and I have been refreshing our mortgage account every few hours today, waiting for the final payment to process. (Weirdly, you have to WIRE the final payment. Seriously? After this years-long relationship of sending personal check after personal check, our mortgage lender refuses to trust us at the finish line? Fine, whatever…) Just before the close of the day, it happened.
Current principal balance: $0.00.
My mortgage is gone. I am done paying rent. I paid off my mortgage early. If all things go according to plan, I will never ever pay rent again for as long as I live. Let’s talk about it!
How it feels
Tanja Hester wrote an excellent article noting that the metaphorical language employed in the personal finance community is often, uh, insulting! We agree with her conclusion that language around “freedom” can be an ookie term considering the history of the literal, actual, non-metaphorical enslavement of human beings in our country’s history.
Still, I struggle to find a word to summarize my feelings that isn’t “free.”
I feel unburdened, unattached, beholden to no one but my own self. I feel clever and successful and proud to be “a woman of my word.” Is this the feeling of… dignity? Yes, holy crap, I feel dignified! Being truly debt-free for the first time since childhood is empowering and thrilling and new and scary.
It also feels utterly gross and wrong to have such good news during such an awful time. It’s only at Piggy’s urging that I write about it at all.
Having good news in 2020 feels like finding out you’ve won the lottery while you’re attending a funeral. You wanna leap in the air and click your heels like you just successfully defended your Lucky Charms from hungry children. Yet at the exact same time, you want to sink to the floor and weep because you’re just so fucking bereft.
At time of writing, half the U.S. population is without jobs. A stomach-churning number of families across the country are facing foreclosure, eviction, and potential homelessness. Given that, sitting the fuck down and shutting the fuck up about how I paid off my mortgage early seems like the best option I have for a personal celebration.
But alas, this is a site about money. We’ve always been open with you guys about our successes and our set-backs. I’m sure the fact that I paid off my mortgage early will come up often enough that I’ll be asked to explain “how I did it.” Which is my least favorite question.
Beware the “Here’s how I did it” narrative
Personal finance is full of headlines following this format:
Here’s How [Relatively Young Person] Paid off [Relatively Normal Debt] in [Relatively Short Timeframe]
Some are legitimately interesting or useful articles… but not many. Most are shortsighted and self-congratulatory wank sessions for aspiring upper-middle-class “finance gurus.” Far from offering helpful advice, their authors loudly announce their own obliviousness by attributing their lightning fast six-figure debt repayment to their bold decision to cut cable, lmao.
These “… and you can too!” articles tend to focus on the same few points:
- Setting goals
- Cutting expenses
- Working real, real hard
- Contemplating how tough it is to resist going out for expensive cocktails with “the squad”
- Being super evasive about their income
Ugh. Honestly, gag me.
Sure, these points are each individually useful and valid; we’ve talked about them plenty. But taken together, they play into a tired narrative about wealth accumulation: that it’s the natural outcome of self-discipline, asceticism, and hard work. There’s nothing complicated about the narrative, which is why we see it so often.
It’s a bedtime story we tell ourselves about capitalism.
Here are some real tips no one wants to publish
Wanna hear how this thirty-three-year-old paid off a $300,000 mortgage in four years? Fine, I’ll tell ya! It all comes down to…
- Being born white
- Having reproductive freedom including access to abortion
- Finding a rich partner
- Lucking out meeting many people who selflessly helped me advance in my career
- Prioritizing my financial goals over my happiness and mental health to an unhealthy and unsustainable degree that no one should ever emulate
- Growing up with enough stability to internalize the comparative merits of self-restraint and social trust
- Having a weirdly shaped brain that finds money management easy and inherently rewarding
Let’s see… have I left anything out?
Oh! There is one more helpful tip to repaying a $300,000 mortgage in four years, which is: earning at least $300,000 in four years!
It’s an ugly bit of common sense that you cannot repay a mountain of debt without making a mountain of money.
Aren’t there any ACTUAL tips?
It really frustrates me when people don’t acknowledge the help they’ve been given. But I get it.
I really, really wish my success story had a cooler plot than “DINKs bought less house than they could afford.” It grates my fucking nerves to put it that way, even though it’s completely true.
Of course there was also goal-setting and sacrifice and long hours; I won’t completely sidestep the element of my own self-determination. We werked! But it’s important to me that our readers understand that they can set goals and sacrifice and work a backbreaking number of hours every day and still wake up in debt. Just because it worked for one person doesn’t mean it’s an attainable reality for everyone.
That said, if you’re trying to pay off a debt early, I do have a few tips that are slightly less bitter and more actionable. Whether it’s student loans, a credit card, or a mortgage, here’s what’s helped me the most.
Learn to spot potential financial exploitation
We bought our home for $300,000, which is well below the average home price in our migraine-inducingly expensive area of the country. Both our mortgage lender and our realtor pushed us to get a larger loan so we could look at more expensive houses.
I did not fall for this trap.
In the process of eliminating my student loans, I’d come to realize how “taken for a ride” I felt by the whole process. Parties who didn’t have my best interests at heart urged me towards a very expensive school, and offered me loans whose terms and interest rate I didn’t fully understand. Not knowing who would want to exploit me, or how they would do it, I was unable to be my own advocate and make more defensive choices when I was younger.
Not so now! When shopping for houses, I knew I couldn’t pay off a mortgage early if I was struggling just to keep up with a normal minimum monthly payment, let alone make an extra mortgage payment every month. And I knew that my lender’s and realtor’s pay scaled with the purchase price of the home. It was in their best interest to get me to spend as much money as possible.
Learning to spot good deals and bad deals is a huge part of gaining financial competence. Along the same lines, don’t beat yourself up if you make financial mistakes. You may learn unpleasant lessons—but they’ll be priceless.
Put more energy into growing income than cutting expenses
My original goal for getting my house paid off was ten years. I managed to do it in four mostly because my partner changed his career, which grew his salary eight times over in the the span of about a year.
This highly unexpected eightfold raise was so helpful we paid itself to itself and hired it to be its own butler.
Your ability to save extra money is limited. You can’t frugal your way out of the necessities of human life: food, shelter, clothing, medical care, etc. Nobody in America is out there living some kind of Aladdin lifestyle, dead broke like woah but still “finding” enough tasty bread to live and sleeping rent-free on a gorgeous, scenic rooftop garden.
Your income, however, is theoretically unlimited. And considering we live in such a naked plutocracy, I don’t know why I bother to say “theoretical”!
This isn’t to say that saving money and budgeting aren’t useful skills. You’ll need them once you have money to manage. But until you have money to manage, it’s not what I would recommend focusing on.
Get your career right. Seek raises and promotions. Consider other income streams, but don’t glamorize side hustles. (As we’ve said before, it’s much better to max out growth potential in your day job. People should not assume the pressure of a second job because their company is too morally bankrupt to pay them a living wage.) Try to join a union, or organize new ones in your workplace to protect everyone’s dignity and quality of life. Because we would all be better off if we lived in a society that made it easy to live within our means.
Ignore the naysayers
I have had more one-hundred-follower finance bros (who always seem to pick a name that abbreviates to three Ms, the cheek) give me unsolicited advice on the topic of mortgage debt than any other topic we’ve covered on the site.
Advice is too kind a word. It’s unsolicited scolding.
Any time I mentioned I was working hard to get my mortgage paid off, at least two would appear to tut-tut at my foolishness. “Don’t you know that you can get an 8% return in the market? It would be MUCH SMARTER to invest that extra money in the market instead!”
First of all, no, I don’t think 8% is a good benchmark of stock market performance.
Second of all, WHO ARE YOU, AND HOW QUICKLY MAY YOU FUCK OFF?
There are a lot of people who confidently proclaim themselves experts, only to fade like morning mist once circumstances prove them wrong. All those market enthusiasts have been silent during the current crisis. The consistency of this “advice” could’ve made me question what I was doing. Luckily, I’d thought deeply about this goal, and considered all options before committing. So I never gave them a second thought.
Don’t let the goal consume you
Obviously, Piggy and I are cheap queens at heart. When we were trying to eliminate our student loan debt in our very frugal 20s, we said “no thanks” to a lot of very tasty-looking adult beverages.
But we weren’t joyless either!
For example, I took one summer off to do meaningful work on a good friend’s nonprofit. It was meaningful and incredibly fun, and allowed me to travel and spend lots of time with people I loved. It paid dog shit; I could’ve made much more money doing almost anything else. But I knew I’d never have another chance, so I took it.
And it was the right call! I rely every day on the skills and relationships I built during that summer.
The average person changes jobs more than ten times throughout their lives, and reaches their peak earning potential between the ages of forty and sixty. You have your whole life to go out and make money. Don’t pass up once-in-a-lifetime opportunities so you can take a few more $15/hour shifts at a job you hate just for the sake of your debts.
… And that’s really it. Hopefully y’all find this more honest take on a “how I did it” story valuable. As always, one of the things I love most about my home is that it gives me the ability to extend stability to others who need it. We’ve already acquired our first coronavirus refugee… I wonder how many more we’ll have before all this is done?
I’d be thrilled if you lifted a glass of whatever you’re drinking to my good fortune; otherwise, that’s all I really plan to say on the topic for now! I wish you all goals based in active desire rather than reactive panic. Be kind, and don’t hold yourself to impossibly high standards.