One day, I will run down my mortgage…
March 15, 2018
Written by Martin Lau
I am a keen runner. I will not break any records. But I am committed enough to pound the pavement regularly and continuously chase my Personal Best at races.
It has not always been this way. When I first started 5 or 6 years ago, I could barely complete a 10 minute jog – resulted by many years of neglecting my health. I remember casting many envious glances when runners glided past me effortlessly.
My first race target was to complete 4km at the HBF Run, before progressing to 12km at the rollercoaster-like City to Surf. But it was all casual until 2016, when I started training with a coach, and begun learning different facets of running. Who knew how fast you run can be broken down into 3 – 4 different zones?
One weekend morning, on my long, slow run, I had an epiphany – running is a lot like managing a mortgage. Most people dislike it but had to have it. And the similarities do not end there.
Everyone finishes the race
Out there, on the road, no matter what distances you are running – 5km, 10km or a Marathon – you will reach the finish line, as long as you keep moving your feet.
When you first get a home loan, a 30 year loan term seems like a long time. And it is a long time. But if you keep up with the repayments, the loan will be paid off.
There is no short cut
After you cross the starting line, there is only one way to the finish line. A predetermined race course. There is no other way.
There are experts who proclaimed they have a strategy to shave 20 years off a mortgage. I suspect they are more interested in boosting their bottom line. You pay off the mortgage by making extra repayments, and diligently managing your financial and investment affairs.
Learning to go faster
To finish a 10km race faster, you need to learn to run faster. You can gradually increase your long run distance and train at a faster pace. Eventually, you will shave seconds and minutes off your race time.
Instead of following the minimum monthly repayments on a 30 years loan term, you can revise the repayment frequency to fortnightly and increase the repayment amount, even if it is just $50 more per week.
It is ok to take a break
During a warm summer morning, even elite runners stop in the midst of their 20km training run to rehydrate. It does not ruin a session. In fact the pause helps them mentally to reassess where they are at.
While we all have the best intention to repay the loan as soon as possible, sometimes, life gets in the way. Maybe it is the new baby in the family? Yay! Or that redundancy? Boo! Don’t beat yourself up if you have to re-adjust your repayment goal.
You are running your own race
In races, some runners will disappear in a flash and some runners will huff and puff alongside you. You will be overtaken by runners, you will overtake runners. However, it is paramount to keep running at your own pace.
We read about people who pay off their home in 3.7 years; or about Jones who upsized to the fancy riverside suburb. But we do not know their life, and we probably do not want to live their life. Stick to the basic money management principles and enjoy your own life!