Mortgage Insurance: What Is It? How Much Does It Really Cost?
A Story Of A Young Couple
Meet Evan and Violet. They are married, 27 and expecting their first child. They also both have good jobs and unfortunately and a big mortgage. They have big and expensive plans for the future. They want to raise three or four children and especially save money for their university educations. However, Violet plans to quit her nursing job once the baby is born and become a housewife indefinitely. Her job pays $75,000 a year.
Evan is a management consultant and earns at least $130,000 a year, in addition of a bonus. He is also confident that he will be earning more as each year goes by. Terrific salary for a young professional!
Their mortgage is expensive and they want to pay it all off by the time they are 40; which gives them 13 years. The whole ordeal costs over $700,000. Do not forget they also want to save for their children’s education. “We’re trying to plan for living on my salary alone while living in a house we bought in Toronto, [an expensive housing market],” he says.
Their biggest single expense is their mortgage, to which they are making extra payments. They do not have an allowance in their budget for vacations because they use Evan’s frequent flyer points, “and we think that with a baby on the way, travel will go down significantly,” he adds.
Their high-income bracket creates a unique planning scenario for their financial goals. I can certainly hope that things do work out for them. It looks like they are on the right track to achieving their goals
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