Budgeting for a Dreamhouse
Today I did some more number crunching in my budget spreadsheet. The picture looks rosier than before, but depends on some important variables. I will outline them here as well as show the breakdown in our monthly budget. It is interesting to look at how, when you shift some variables here and there, you can make things happen. Well, at least on paper it looks good. Implementation is another story.
Important Variables:
- Mrs MMJ can get to 30 hrs per week at the job or find some other source.
- I can find a job that will fill the rest of the gap. While I love my current employer, it may be to move on since I have seen better paying offers in the market. This is something we have been mulling even before the decision to find a new house.
- We can get enough out of the sale of our current house to help payoff our auto loan. This is a $278 per month savings.
- Our 2009 Tax return and work bonus level remains the same as previous years.
- The housing market does not rebound too soon. If the prices on the homes we are looking at rise, the game is over.
The above 4 variables are nail bitters for sure. We will try to tighten our budget as much possible and hope that the variables we can’t control(Housing market, wife’s current work situation) will work in our favor. The key is that for us to succeed, all the variables have to play out positively. The changes we have made in the last year have given me a positive view.
Now for the Budget
The one thing that bothers me is that the loan payment in our new house would be over 50% of our projected income. That number is double the recommended percentage and as I look at it, it is the one thing that would hold us back even if the above variables worked out.
Here is a look at the our current budget and 4 potential ones that are explained in the top row. Please click on the image for a proper view.
Maybe Hold Off
Our original idea was to plan or the move by the beginning of June. This would depend on the selling and buying to occur perfectly. Now that we look at that future mortgage more closely, it makes sense to either squirrel away as much money as possible over the next 2 years or pay off as much as possible on our auto and home equity loans. Both options make a lot of sense. We would be able to add more to our down payment and cut down on a future mortgage.
Decisions, Decisions
As you can tell, this is no small decision. As I write more about it, maybe some of you readers can offer thoughts that can clear my mind. The one thing that is great about this is that as I look at our current budget situation, it is not as bad as we were a year ago when we were spilling over $1000 a month onto credit cards.
