What to do, what to do? Good question when faced with either $2,500 repair on a 30-year-old furnace or a replacement cost of $6,300. For those who may have missed part one, you can read about it here.
We have decided to replace the furnace. Although the cost of doing so is more than double the repair estimate, this makes the most sense. The issue now is how to pay for it? I’m genuinely feeling nauseous with our solution, but I also realize a properly functioning furnace is a real emergency. That being said, we are financing this purchase. I know, I know.
I’ll be honest and say my first thought was to take everything we have in our checking and savings account and pray Hubs next check would be enough to cover the rest. While it *might* be, I’m not sure how we would then pay our upcoming bills. As it is, I was planning on throwing a larger snowball at our Citi debt. Now with this furnace situation, a snowball isn’t happening right now.
So what have we done? We took out a $6,000 12-month 0% advance on our Discover card. With a 3% fee, this loan will cost us $180, providing we pay it off within these 12 months, which we will. Now please pardon me while I throw up. Adding $6,180 to our debt is not something I wanted to do.
A reasonable question would be why almost the entire amount? That came down to our (admittedly self-imposed) need to keep our savings going. Obviously, we were not prepared for this type of emergency. Now that we are going through this, we feel an even greater need to distance ourselves from these nasty visits from Murphy. We also have other concerns (upcoming taxes, family member health issues to name just two) that is further pushing us in the direction of increasing our savings.
Where does all this put us financially? After several discussions with Hubs, I’m working on it. Stay tuned.
Wow. Tough choices for sure. I do agree that it makes more sense to replace it now than to pay for the bandaid and then replace it later. I probably would have used some of my savings and financed a smaller amount. I think you should slow down on paying the other debts for now and focus on paying the furnace off right away and bolstering the savings a bit for taxes and travel expenses. I am sure you will be debt free by the end of this year. It just might take a little longer. And that’s ok. You are doing great!
Unfortunately, we need to also focus on paying off our Citi card as the 0% rate expires in June. Our goal to get debt free this year remains the same…even if it takes us a little longer. Thanks for your encouraging words.
“Now pardon me while i throw up.” It’s good to see you still have your sense of humor.
Well, if you need to borrow funds, doing it at zero percent interest is the way to go, and I have no doubt you’ll pay it off within the 12 month allotted time!
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Sometimes it feels better to laugh than cry. I have no doubt we will get this done. Just a bump in the road.
Well, I guess that is the best option of the two bad ones, eh? I also have NO doubt you will pay it off quickly and be right back on track. Just imagine if this would have happened before you got to where you are now. You are still doing great. It’s also something we should all think of when we have older appliances and systems – they will need replaced/repaired and we should all probably be budgeting/saving for these. Maybe your new furnace will be more efficient than the 30 year old one and you will see some savings through that each month. Hang in there!
That’s what we figured. With a house that is 30 years old and still has ALL the originally appliances and mechanicals, things are bound to start happening. We do need to do a better job with being prepared for things to fail. Thanks for your words of encouragement.
You are making the right decision. Spending the money on a new furnace now will give you years of reliability. Your new furnace will most likely be more efficient.
I hope so! The new furnace also comes with a two year parts and labor warranty, so we will have that peace of mind too.
Hi Lucy, I agree with what One Family said, yes, it is a setback, but I know you will have it paid off quickly. Hang in there and don’t get discouraged. I think you are doing so well.
Thanks, Chris. In spite of the setback, I won’t give in. 2019 is the year we will be free from our non-mortgage debt!
We had our water heater and several valves go this weekend….over $4k 🤢 We were in your boat just a few years ago and it took a long time, several blessings and several setbacks. I remember our last house something like this haplmeimg but the cost wa s only 1k and we had to use our entire emergency fund. It was awful. This time we had cash and were able to get a 10% discount. It still hurts…a. Lot. I do not like using my emergency fund, even for emergencies! I know you will get there…just stay the course!!
Ouch! But what a great feeling it must have been knowing you could cash flow the entire repair, and save money with a discount! While I don’t like this setback, I do feel we are in a far better position to rebound. Had this happened even two years ago, I’m not sure what we would have done.
With the way you have been ROCKING this debt payback, this is just going to be a little blip in your radar – you will get this paid off in NO TIME!!!! I am REALLY trying to get my sinking funds built up but I keep stealing from them to pay something else….how do you get to the point where you have $6300 in a sinking fund for a household emergency????? Is it even possible while paying off debt?
Thanks, Sue. We will see this through. We’ve come too far to quit now. Sinking funds are still a struggle for me as well, It seems like the money we try and save never stays put for long. Sigh. I wish I knew the answer for how one plans for something like an unplanned furnace replacement. For me, it became a “what would Dave (Ramsey) do?”
A furnace is a need-you’re not financing a cruise. Good luck and hang in there.
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Yes, but a cruise would have been so much more fun! I think when I first hear the new furnace kick on, I’m going to pretend it is the sound of crashing waves. At least we will be warm, too! Lol
Good luck. It is just one baby step back. You have already walked miles in your journey. Don’t stress about it to much. Just go crazy on it and get it done ASAP. We are all cheering you on.
Thanks, Marybeth. Our goal of getting consumer debt free in 2019 remains the same. Now we just have more to tackle, which we will!