It’s been a miserable summer in Juneau. Rain, rain, and more rain. I wonder how many people have seriously considered moving because of it. And I wonder how many of those people decided to stay because of the Alaska Permanent Fund dividend.

The Alaska Permanent Fund is Alaska’s way of giving back to the residents of the state. Profits from oil sales are put into a fund, only 1% of which is then invested. Every October, the average earnings over the last five years is split among us 600,000 (or so) residents. (It’s more complicated than that, but only slightly.) Our dividends dipped during the dot-com crash, but that five-year average insulted us from a huge cut. Conversely, it’ll take a few more years before we see how high these record oil prices push it back up.

Everyone’s waiting for the checks, which could arrive as soon as Friday. This year’s dividend is the biggest ever, at $2,069. Of course, our illustrious governor decided that her constituents were unfairly burdened by high oil prices this year, so she spearheaded an initiative to share a little more of the state’s wealth. Each resident will receive an extra $1,200 in “energy relief” this year. (No wonder she has such a high approval rating!) The energy relief packaged is issued by the same office, the Alaska Permanent Fund Division, so in essence we’re each receiving a $3,269 dividend this year. Think of it: A household of five will receive a bulk sum of $16,345! Sky’s the limit for Mormons and Catholics! Who wants to move now?

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$300,000. That’s the amount that Alaska Pacific Bank was willing to sign over to us at the drop of a hat. During the AHFC homeowner’s class, we were told a simple formula to guesstimate how high our mortgage could reach and our combined incomes topped it out at only $210,000. You can imagine the shock we had when we realized how wrong we were.

We spent that Friday evening going over the large amounts of practically incomprehensible paperwork. The $300,000 loan would be good at 5.5% interest, only 5% down, and the closing costs would be about $10,000. It would have stretched our finances to the limit, but conceivably, we could have taken that loan out on Monday!

The part that gave me the most pause, though, was the schedule of payments. The magnitude of a 30-year loan doesn’t quite sink in until you see the date of the final payment: April 1st, 2036. 2036! I’m picturing the end of fossil fuels, world-changing contact with extra-terrestrials, or at the very least, flying cars! Are we really ready for such a protracted commitment?

We had plenty of time over the weekend to reevaluate our financial lives. Could we afford a waterfront, sunlit house? Would it be possible to build our own home? Should we even consider pushing our limit, or should we look into something we could pay off in a lot more time?

We also started to talk more seriously with other homeowners, and of course, the suggestions started to come in fast and furious. Spend your limit on waterfront – it’s an investment! Get a place with an apartment so that you can rent it out and let someone else pay most of your mortgage! Spend as little as possible so that you have some remaining cash flow for emergencies!

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