Three years ago, I was 18, single, no debt. Now I am 21, married, 2 kids, with a LOT of debt. I live in the Greater Victoria Area (where home prices are quite high). My wife and I make about $6000 per month net (for now - which includes an $1100/month income suite), but I am worried that if our income drops, i.e. our tenants move out and we have a vacancy, or if my wife loses her job ($1500), we won't be able to sustain the debt. My debt consists of:
-$14,000 variable rate loans
I have about $17,000 in RRSPs, and about $1000 in TFSAs. Our house is probably worth about $445,000.
Our monthly expenses are pretty high:
-$250 property tax
-$1000 groceries (food costs a lot more on the island)
-$300 gas (I live 40km from work)
-$520 investments (TFSA, RRSPs, RESPs)
-$500 other variable expenses
That leaves a little under $500 per month for a cushion, which isn't very much in my situation where a lot of money is at stake. I'm wondering, should I sell off my investments to pay off my variable loans and throw all the extra money at my mortgage? Or should I continue doing what I'm doing and hope that it all works out? I would like to feel some sort of control in my financial life.
Thanks for your suggestions!