I can’t believe it has been 19 months since I last determined how much interest I pay to financing companies!  I remember how I felt when I wrote that post, while I understood how amortization loans worked and that financing costs were inevitable it wasn’t until I did the actual calculations that I found how much was going to interest. In November of 2009 I was paying approximately $1,498 in interest per month and that was out of a little over $1,900 in monthly debt servicing payments.

So when I came across it in my archives I knew I should at the very least attempt to recreate that experience to determine if the amount being paid towards interest was lower.

How Much of My Monthly Payments are Going to Interest?

I don’t keep a balance on my credit cards which is why none are present.

DebtMonthly PaymentPrincipal PortionInterest PortionDifference From 19 Months Ago
Mortgage Payment$1,259 (without Taxes)$183$1076$44 More towards Principal
Student Loan #1$252$82$170$82 More Towards Principal
Student Loan #2$106$80$26$5 More Towards Principal
Auto Loan*$221$198$22$92 Will be paid off by the End of the Month
Total$1838$543$1,294$204 Less Interest Per Month

I would assume I am like most people in that home lending costs is my biggest debt and I doubt that is going anywhere any time soon, however, I am pretty happy with the strides I have made in the other debts.

I refinanced the auto loan since that original November 2009 post and have paid it down with intentional aggressiveness. Year to date the auto loan balance is down about $8,000 and should be paid off in the next 10 days. I will then focus on building my assets more than paying off debt, whereas, now it has been a shared primary goal. 

Has my Attitude Towards Debt Changed?

I don’t think my general attitude towards debt has changed all that much, but rather my priorities have.  My first priority was to get rid of that ridiculous auto loan, and then, for the rest of the year, I will balance (in this order):

  • My need/desire for liquidity
  • My need/desire to pay down School Loan #2
  • My need/desire to build up investable assets

Have you ever done a similar exercise? How did it turn out?

photo credit: Arrrgghhh