W Network - Money - Episode 2

Episode 2 - Renee and Boris

Burn My Mortgage

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Renee and Boris say they are tired of being tied to their mortgage but their lifestyle tells a different tale. They’ve got the means to make their way to mortgage freedom - the question is, do they have the discipline?

MORTGAGE DETAILS...

Mortgage Amount: $545,000
Interest Rate: 4
Amortization: 25
Interest cost: $315,000

Actual Cost of Mortgage: $860,000

CHALLENGE 1 – A Night Without the tech Toys

THE FINANCIAL FOIBLE...

Shopping for electronics and small appliances is a costly hobby for this household. Renee, Boris and the Kids have one of everything! In this last year alone this family has spent $6000 on electronics – that works out to $500 per month. Spending time with their gadgets and gizmos is taking away from the family in more ways than one. Time for them to strip down and have a peek at a life without.

THE RULES...

We parked a 35 foot Motorhome in this family's driveway. If they can spend the night together without the gadgets, we will reward them with $1500. Start the clock – we gave them 10 minutes to go in the house and grab what they needed to get through the night – everything except for electronics. THE RESULTS... By cutting out what they were spending on tech toys this family will have an additional $500 a month - $6000 a year to put down on their mortgage.

The results?

They will save $82,000 in interest payments and take 5 years off their mortgage

Challenge 2 - Learning the Value of a Dollar

THE FINANCIAL FOIBLE...

Renee is shelling out $1000 above-and-beyond the basics for the kids every month – that’s $12,000 a year! The girls are old enough to bring in their own spending money but who needs a job when Mom is there to dole the cash out. It’s time for these kids to learn the value of hard work and a dollar.

THE RULES...

Niki, Indie, have 25 hot dogs to sell each @ $3.00 a piece. If they can get rid of them in 30 minutes – they’ll get a $1500 reward. Liam, is in charge of condiments.

THE RESULTS...

The kids got the message loud and clear! If Niki and Indie both work one day a week, even at minimum wage, between them, they could earn $600 a month - that’s $600 that Renee can slap on the mortgage. If we add that to the savings from the first challenge, Renee and Boris will have an additional $1100/mth or $13,200 to put on their principle annually. The results? Responsible kids, $138,000 in savings on interest payments and 9 years off their mortgage.

Challenge 3 - Show Me the Money!

THE FINANCIAL FOIBLE...

From coffee to books, to clothes to spa treatments, Boris and Renee’s debit cards get a daily tour of their neighborhood to the tune of $2500 every month! Not keeping track is a sure way to overspend – this family is guilty of both crimes! Time for this family to chase the paper trail and find out where they are going wrong

THE RULES...

This family is going on a shopping spree. Except they are not going to spend money – they are going out to find it - the $2500 they lose track of in debit card purchases every month. Hidden amongst their favourite neighbourhood shops are clues and cash – they’ve got 30 minutes to find $2500. If they make it in time, they’ll earn an additional $2,500.

THE RESULTS...

If Renee and Boris cut their debit card spending by half, they'll have an additional $1250 a month to add to the savings from the first two challenges giving them $28,000 that they could be putting on their mortgage every year. The results? 14 years off their mortgage and $200,000 in interest savings.