Reviewed our networth update. Still looks good - better than I thought - close to $100k gain by end of month (4/30). This summer will eat a good amount of that if markets are static or negative. I'll post the monthly tomorrow.
Yesterday was the first day where most of my advanced transactions were available for September. I accelerated entry of a few and finished out the month.
June through August will be a challenging period as I'll be the only one working, we'll be in a new house and my wife will be travelling on holiday. Bad combination for the cash conscious. Especially after the few months my wife took off 2006. We just came back and now it's going back out!
I've put in an expected monthly outflow for two mortgages. The current house is easy - I'm already paying that. The new house is more challenging as the closing hasn't occurred yet - so I'm estimating.
I estimate my tax benefit for the mortage interest to be about 1/3 of the mortgage payment - 10% (buffer). I expect the tax benefit for the property tax to be about 1/3. I reduced the estimated mortgage payment by the resulting benefit numbers to understand the net monthly outgoing cash flow, but this ONLY WORKS, if I talk with my accountant and reduce withholding accordingly.
I will attempt to do that tomorrow. Better to make the adjustment as soon as possiblee.
The bottom line:
If I get the tax breaks I expect:
$1,600 per month saved while making two mortgage payments
$4,400 per month saved when making only one mortgage payment (after original house sold)
My cash reserve will take a huge hit and be converted to illiquid home equity.
It will further be depleted by $25,000 to cover expense gaps while I'm the sole provider.
I'll still have about $46k in backup accounts and about $89k in non-retirement equity, but will try as hard as possible to touch very little of it, as the expenditures will not be converted to equity.
New expenses will be interesting. We'll have to gate off an access area to the swimming pool, open it for the season and maintain it weekly.
Not sure what other expenses will hit us, but some decorations always do, like window treatements. Lots of windows in this house...makes me worry.
I have a few potential avenues for additional tax, such as old business expenses reimbursement, flex spending accounts, etc.... I also have an old insurance claim being resolved. These can add to our situation. Am wondering what effect they have.
I could completely skimp on meals while travelling to save the per diem, big quality of life hit, but might do it. Maybe, I'll lose weight? It would suck to work as hard as I do (12 hours plus) to save $38 - $58 per day, but it does add up.
The good news is that:
a. We can cover both our mortgages
b. We have a chance to still save money
c. Once we sell the old house, we'll save a decent amount per month