Personal Finance Reads: Burn Your Mortgage by Sean Cooper

For our latest personal finance book review, we tackle Sean Cooper’s recently released Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians. Below is our take on his ode to frugality.

Book title: Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians

Year published: 2017

Author name & bio: Sean Cooper is a personal finance writer, speaker, and money coach. He bought his first home when he was 27 and paid it off by age 30. Find him on Twitter at @SeanCooperWrite or read his blog at www.SeanCooperWriter.com.

What’s this book all about?

Burn Your Mortgage is a comprehensive primer for the prospective first-time home buyer. It covers almost everything related to homebuying you could imagine, including building good financial habits (like my personal favourite: tracking your expenses), determining if homebuying is right for you, deciding between house types, selecting location, navigating the mortgage process, accelerating mortgage payments, the ins and outs of being a landlord, and the power of side hustles.

For Cooper, homeownership is all about achieving financial freedom. And he explains how to tackle life’s biggest financial decision through good, old fashioned hard work. Judging by the fact that he paid off a $255,000 mortgage in three years, we can be pretty sure his techniques work.

But aside from what you’d expect out of a book like this — actionable advice about homebuying and mortgages — what surprised me is its unapologetic defence of frugality. Given the recent trend in the personal finance world to embrace 'balance' above thrift, I found this perspective refreshing. (Yes, of course you can have both, but you get the point).

Who should read this book?

Anyone considering purchasing their first home should read this book — plain and simple. It’s an easy read that’s rooted in real life examples, has oodles of creative cost-savings ideas, and includes helpful end-of-chapter summaries. Because let’s face it, there’s a lot to remember when it comes to buying a home. 

Even if you’ve already made your mind up about buying versus renting, Burn Your Mortgage is a powerful reminder that we have more influence in the homebuying process than we’re often led to believe. A 25-year mortgage term can become a 15- or 20-year mortgage term more easily than you might think.

3 biggest takeaways

1. It’s O.K. to be obsessed with paying off your mortgage — at least in the short-term.

Cooper caught some criticism from internet folks (shocker) when he burned his mortgage for having an unusually large down payment ($170,000), living in his basement, working 80 hours per week, being extremely frugal, etc. But I say the more power to him. Sure, his approach isn’t for everyone, but a few years of slumming it while earning a good salary can pay off big time. Short-term pain for long-term gain, as Cooper describes it. His philosophy feels like something from a different generation: work your ass off and focus on your stretch goal. Maybe even focus on it to a fault. Because the sooner you get out from under life’s biggest debt sentence, the sooner you gift yourself the best thing money can buy: flexibility.

2. Curb your (lifestyle) enthusiasm.

It might not earn any popularity points, but Cooper repeatedly stresses the importance of making long-term financial freedom a top priority. And he’s not ashamed to admit that it comes at the cost of lifestyle inflation — a term used to describe how our spending habits tend to grow with our peers and our careers. If we can resist the temptation to upgrade our lifestyle with every career advancement, we’re left with extra money to put towards debt, save for a down payment, or pay down our mortgage. Related to this, Cooper challenges readers to not just live within their means, but to live below them. Again, it’s all about stretch goals — pay off more than the minimum, save more than you need, and burn your mortgage more quickly than expected.

3. Accelerating your mortgage payments.

In terms of concrete homeownership tips, this was a biggie. Simply by switching your mortgage payments from monthly to bi-weekly (coordinating payments with paycheques), you can save over $15,000 in interest and be done with your mortgage nearly 3 years sooner. How? Because it means you’re paying roughly an extra month’s mortgage payment each year. It’s an easy tweak, with huge payoff, and you probably won’t even notice the difference. Another powerful tip was to round up your mortgage payments; so a $709 bi-weekly payment becomes a $725 bi-weekly payment. It’s a minor move that can shave off another three years from your mortgage.

Lingering Questions

Cooper touches briefly on being ‘priced out’ of housing markets, but addresses it mainly by encouraging homebuyers to act quickly (when they’re ready, of course), so as to avoid missing out. But what about those of us who are already priced out?

The down payment is saved, the finances are figured out, the house type is realistic, but we've simply missed out on affordable options. That’s the reality that many urban Canadians face, and that’s what I found missing from Burn Your Mortgage. Obviously, nobody expects Cooper to create opportunities where they don’t exist, but some discussion around realistic alternatives for urban professionals (non-owner occupied properties outside of the GTA? A shoebox in the 905 exclusively to rent?) would have been helpful.

It’s hard to burn a mortgage that you can’t possibly afford — no matter how frugal you are.

Favourite quote from the book

“You can’t expect to accomplish something by doing nothing. Procrastination is the biggest enemy of success. You don’t have to get it perfect, you just have to get it going.”