How to Do Better Teaching Stuffs
Friday, February 22, 2008
For
You-Know-Who, so she doesn't get fired.
I do actually have some interesting news, though I'm afraid if I actually talk about it, it will all fall apart. Here goes nothing.
MW and I are awaiting the verdict on our Mortgage Application. We went to go see a financial planner, who looked at our financial information, said "You have $50,000 in debts, and no assets". And then I threw up all over his executive office.
Well, half that is true. I'll let you guess which half.
(but seriously, though, I totally made the "gglaaaggbbfffghkkkk" noise when he said that.. he didn't really think it was funny)
So, he gave us two pieces of advice to get more
"positive debt" and less "negative debt". Essentially, positive debt is debt that can build your wealth/assets, and negative debt is unnecessary debt. Between us, about $35,000 of that $50,000 is student loan debt. There is really not much we can do about that, but we can tackle the other debt we have (credit cards, lines of credit, etc.).
As a public service (unless you already know), here are the two piece of advice:
- Get an RRSP Loan. I always knew it was a good idea to invest in RRSP as soon as possible, but I didn't know that you could loans specifically for that purpose. There are two good things about this strategy. The first is that, dude, you're totally investing in our retirement, and that's always good. The second is the tax benefits. So, let's say you take a $10,000 loan. You put it into RRSPs and then BAM, your tax return comes back with $3000-$4000. So, BOOM, you can take out one of those credit cards, removing that payment. Now, you still have to pay back that loan. We were quoted (for a 24 month term) around $500/month (back to that later). So, instead of making payments to VISA, you're making monthly payments to yourself.
- Get a frickin' mortgage already. In the past 2 years we've lived in our apparently, we've basically pissed away $20,000. I think everyone knows the logic in this. But, ya.
So, after some number crunching, etc, we decided to, right now, get the mortgage training rolling. I love the idea of an RRSP loan, but we are expecting, since we intend to buy a condo rather than a house, to spend a little more in mortage payments/condo fees than we are now in rent. If we coupled that with a larger RRSP loan payment, we'd be eating Mr. Noodle and cat food. In the long run, it is better to do both, but we decided to just do one at a time so we don't overwhelm ourselves.
My parents are coming up this evening to talk with us about how to actually go about this whole home buying business. I'm just impatient to get a real estate agent and get things moving. Our lease is due in May, so we really only have until the end of March to work something out. My gut tells me this ain't going to happen, but how hard do you think it would be to get out of our lease? It's a very popular building, so I don't imagine it would be all that hard? Anyone?
4 came
4 Comments:
yipes!
You should totally buy a place. It's really satisfying to have a place that's *yours*. You might even be able to work some of your debt into the mortgage.
Grant is actually considering renting if we can't find a place when we sell ours, and I'm like, are you retarded? He's not, but I'm holding out hope that we'll sell and find a place and happily ever after.
We started looking for our place last year in mid-march and moved April 28th, so it's totally possible.
If you do have to sign another lease, you might be able to sign for 3 months instead of 12 or work something out. We left two months early, but helped our landlady find a replacement. We posted on craigslist and it was super easy.
So exciting!!! Keep us posted!!! Woohoo!
I suppose it makes sense to rent short term, but, yeah, that's definitely a good plan B.
We did actually check in maxing out our mortgage so we could pay off some cards, but it turns out you can only do that after a certain amount of time has passed.
Thanks for that, Jules. Last month, when we were looking for apartments, they get snatched up pretty quickly, especially the higher end, downtown ones, so I can't imagine it would be that difficult. We'll see, I guess.
I do not know what housing is like where you live, but you could equally look into trying to purchase a house that functions as a duplex. You could rent out part of it, ideally for a sum that would cover your mortgage, and live in the other part.
I only say this because I walked away with a $30,000 profit after I sold the house I lived in while going to University. And that was only after owning it for 2 and a half years. I did a lot of renovating, but the point is that I had strangers pay my mortgage so that I could concentrate on fixing shit up. It worked out well for me.
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