Other Goals from 2011

In addition to our 2011 savings goals, we had a couple of other 2011 Goals.

I'm happy to report that just this week I finally rolled over my old 401k.  This "to do" had been on my personal to do list for six months when I put it on our "2011 other goals" list.  That means I've been thinking about this personal project for 15 months.  But, listing this "to do" on our "2011 other goals" list got me to do it before the end of 2011.  And, crossing this "to do" off my list before year's end makes me happy.

We also had a goal to get our debt under $600,000 in 2011 and we were able to accomplish that goal as well. We actually added to our debt load, a bit, this year when we rolled refi costs for one of our investment properties back into the loan.  Right now our debt load is at $595,088.  In January 2011, our debt load was at $613,291.  Which means, in 2011, we have paid down $18,203 in debt.  As we think about our 2012 Savings Goals, we are thinking about whether to renew the goal to pay down mortgage principal.  I vote yes as I find paying down debt more fun than savings.  I wonder why this is, I need to research and spend some time thinking about this issue.  

Regarding our debt load, it doesn't really make sense for us to pay down the debt on our investment properties because our tenants are doing that for us.  Since we will be holding these properties for some time  there really is no advantage to prepay when our tenants cover the carrying costs for us.  Even though this debt is on our personal balance sheet and in our personal names it really is business debt.

But, when it comes to our primary home, I would really like to pay down that mortgage.  Being personally debt free would, of course, be awesome.  Without a mortgage payment we would have a lot of extra money to invest and save.  And if we paid off our mortgage we would have flexibility with our wind-storm insurance which is very expensive in South Florida.  However, I still question, as we should, the economic benefits to paying down our mortgage when we've got a low fixed rate and it is tax deductible.  On the other hand if I'm using dollars to pay down our mortgage that I'm not using for savings/investing, well that probably makes sense.  For example, if we reduce our eating out expenses and use some of those dollars to pay down the mortgage.  Could we get our debt down to $575,000 in 2012, I think we probably could.  That would mean paying down @$20,000 in 2012.  And in 2011 we paid down more than that, but we added some debt back in during our refi.

We still need to find a new accountant.  We have got to prioritize this goal for early in 2012, because I would like to get our taxes done on time and not file for an extension again.

Also adding to the other goals for 2012 is revisiting our insurance on each property and on our cars. We need to determine if we have the appropriate coverage and determine if we can save and/or take advantage of discounts.