We have been on a good roll with our 2nd mortgage accelerated payment plan, paying down an extra $1,930.53 in principle since January 2008. The extra payments to our 2nd mortgage were great to pay down the principle, but cannot be pulled back out in case of an emergency (it’s not a HELOC). So, due to the current U.S. economic situation, we have decided to deposit future funds earmarked for our 2nd mortgage accelerated payment into our savings account.

We’re doing this to temporarily increase our emergency fund during this volatile time. That way, if the economy gets so bad that people start losing jobs, we will be a bit more prepared. Once the economy straightens out, we plan to pull the earmarked funds from savings and apply them to our 2nd mortgage.

I hope we never have to touch the money, but know we will sleep better with a bit more of a cushion right now.