This client took your advice

One of the best parts of this job is the complimentary advice I’ve received from readers like you. I’d like to share some of the philosophies that have truly made a difference for me—especially given the current downturn.

1. You can’t have it all. Decide what is truly important to you.

When my husband and I first got married, we had two choices. We could live in his modest bungalow or we could buy a bigger home. But buying a bigger house would mean moving away from the city centre. Or if we stayed in the city, a bigger house would entail a much bigger mortgage and payments—doable but it would mean sacrificing things we’re both passionate about, like our biannual vacations. So, we settled on the bungalow. That meant a year of stepping on shaky plywood and dodging loose nails, and being relegated to exactly three rooms in the house. But there were positives—lower mortgage payments meant more money for renovations, savings and investments.

2. Variable mortgage rates pay off in the long run.

Perhaps we just got lucky on this one. When our mortgage came up for renewal in 2006, our bank offered us a variable rate of prime minus 80 basis points for four years, or the option to lock in at 5% for the same time period. We opted for the former, and instead of lowering our mortgage payments each month—something many choose to do, apparently—we arranged to double our payments, and added extra payments each year as the interest rates got lower and lower.

3. Kids are expensive. If you can, get that mortgage paid off first.

We’re now expecting our first child, who will be born sometime this month. We imagined the freedom of being mortgage-free—more money for investments, RESPs and life insurance. We didn’t quite achieve this goal but are pretty darned close. In fact, by the time our child celebrates his or her first birthday, we’ll be mortgage-free.

It’s been fun covering this industry over the last 10 years. Thank you for your support. For now, I’m looking forward to embarking on a new adventure—motherhood. We’ll reconnect next year.