I had one of "um duh" moments the other day. I was thinking about needing about $15,000 to pay off the second mortgage. Then I thought about the approximately $12,500 I have in savings (some of that we got back from our canceled Japan vacation) and the approximately $2,500 more we should be getting back from the canceled vacation within the next couple weeks and then I realized if I really wanted to I could actually pay off the mortgage! But of course if I did that, I'd be left with NO emergency fund, and also the property taxes are due next month and some of the savings was being saved specifically to pay the taxes. I would also have to take early redemption penalties on some CDs. However, I make between 1 and 1.25% on the CDs and the mortgage is over 8%. One of the CDs has about $1,000 in it and it made a grand total of 96 cents last month. Right now we're paying about $4 a day in interest just for the privilege of having that second mortgage. So it sounds like a no-brainer, let's just pay it off! But like I said, I’m still waiting for $2,500 to come back from our canceled vacation, I don't feel comfortable going with no emergency cash and I need some money to pay taxes. However, I think I can build up a small emergency fund and make enough money for the taxes in the next month. I think four more paychecks should be enough, so I think I'm going to shoot for May 5th as the pay off day! A few months ago I thought I’d be lucky to pay it off in two years, last month I was hoping for the end of 2011, and now it’s less than a month away and I'm very excited! I just hope I don’t regret running our emergency fund that low. I don’t think I’ve had less than $5,000 in savings in at least 3 years and it kind of makes me nervous.
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