The ups, downs, and occasional sideways bits of trying to be mortgage free

armchairexpert · 9 February 2017 at 5:00AM

Hello! I used to loiter around here a few years ago and you were all terribly friendly. Then I was made redundant, started my own business, and it's all been a bit uppy and downy since then.

We've been meandering along for the past three years, since taking on a new mortgage in 2014, paying things as they come up and failing to notice that we're not making a dent in the mortgage at all. It's set up as a line of credit, so the minimum payment on it is only interest - we'd expected to be paying down the principal as well just as a matter of course, but it hasn't quite worked out that way.

I'm not going to do a SOA because I'm in Australia, and even the most dedicated MFW'er probably can't tell me if I'm paying the right amount for my electricity! But I have buckled down and done a very comprehensive YNAB budget, and it tells me that I should have about $700/month extra without cancelling the children's extra-curricular and the occasional treat. We shall see if this holds true.

As an aside, I also have a second mortgage on a buy-to-let, but the tenant is my mother, who can't afford to pay us market rent much less cover the running costs, so that costs us about $5,000 a year or so. As a way of clawing back savings, I don't budget any of the tax reductions that brings us, I just treat it as a normal expense, and then anything we get back at the end of the tax year is like an annual bonus.

What else? Two DDs, the youngest one started school this year which is a GAME CHANGER I tell you what, some lovely silly chickens who very generously make eggs for us, the beginnings of a fairly pathetic vegetable garden which I'm not convinced even pays its own running costs - and long suffering DH, of course, who keeps the lights on.

Also I am not the most succinct person in the world.

armchairexpert · 9 February 2017 at 5:15AM

Of course, I sat down and did a very responsible budget with instalment payments worked out for all the upcoming bills - and then five of them came in at once. Quarterly strata, quarterly council rates for the main property, annual school fees for both children (only $800, which is A Bargain, but still a lot of money to find at once), term fees for their ballet classes, and oh, DH says, did he mention he forgot to pay the last month's phone bill, so he's just paid off two months at once. I have a sneaking suspicion that the other set of council rates is about to come in as well.

All of this means that it's increasingly unlikely I'll pay a red cent off the mortgage this month. My goal is to make it through to zero: if I can start fresh next month, instead of behind (my usual approach: oh, it's been a spendy month, we're further into the line of credit, oh well, next month'll be better!) then I should start seeing some progress.

In the meantime I am terrorising DH to sort out his mobile phone contract (he goes over his data limit every month and pays through the nose for extra data) and find a life insurance policy that he's somehow paying $71/month on which seems like an awful lot.

armchairexpert · 10 February 2017 at 12:44AM

After an entire night of running the air conditioner because it was 42 degrees here yesterday - not a typo - and 39 today, I am far too sticky and cross to do anything at all, frankly. So I guess that's a saving.

I am contemplating the problem of how to rein DH in on the grocery budget.

He does the weekly shop at the moment, and I think I'd hurt his feelings if I took it over, but he is the king of 'it was a BOGOF so I got 8' treats. He also spent $40 on rump steak last week, because he 'wasn't sure if 2 steaks would be enough' so he got 3, which turned out to weigh 1.6 kg, because I guess a family of 4, including two small children, needs to eat almost 2kg of RUMP STEAK just casually on a weeknight.

Do you think if I write him out a shopping list that has things we need down one side and things we Definitely Do Not Need, Not Even If They're On Special, on the other, that would work? And remind him that just because something has a yellow label doesn't mean it's a bargain? I'm going to have to come up with a great reason why I should do the groceries, aren't I.

ada-or-ardor · 10 February 2017 at 8:09AM

I totally sympathise with you on the DH who leaves all the lights on - argh!

It sounds perhaps like you two are on very different pages - probably because your only debt (I assume??) Is the mortgage and he thinks "everyone has a mortgage and takes forever to pay them off, so let's enjoy some steak!". Have you spoken to him properly about your thoughts and plan to chip away a bit more? If you haven't, and he has no idea, he will just scupper your plans at every turn - and I doubt a shopping list would keep him on track! He sounds generally quite relaxed towards money - the phone bill, the life insurance, the steaks - so I'm guessing it's just his attitude and you may have to accept that and but keep a check on the smaller things and make sure they don't affect your joint spends on mortgage etc. Has he any idea that you're not making a dent in the mortgage, and that your second property is an expense and not a source of income?

I think a big chat is in order, just so he knows where you're at, and you him.

PS - also not succinct! ;-) it's your diary, write as much as you like! And please send some sun to England!!

Ada

armchairexpert · 10 February 2017 at 10:53AM

God, you're welcome to as much as you want. It's just horrible here now. It sounds nice, briefly, but the house heats up and the plants wither and nobody's slept a full night all week.

He does know about the other mortgage and the not-making-a-dent, all our finances are shared. But last year he was choosing not to know, and because everything runs through a card and the line of credit's pretty deep, it's pretty invisible. When I make a budget and tell him about it, he goes along with it, but we've both been a bit too laissez-faire. He does have a tendency to shop for shopping's sake, but it's not large extravagant gestures, it's like - once I went on a dairy-free diet for a month, and he bought an 8-piece coffee set "especially for your black coffee".

Also I don't want to turn into the harridan going "you've exceeded your lunch budget this week, take a sandwich", so there's that.

Anyway! Meal planning for the upcoming week is about to commence, and I have persuaded him to go to the cheaper fruit-and-veg market instead of the expensive one next to the supermarket, and "in return" I will do supermarket, ha, result.

armchairexpert · 12 February 2017 at 1:05PM

Excellent and MSE weekend! Heatwave finally shifted east and we got out into the garden - it's been literally too hot to go outside this week. I kept my half of the groceries (supermarket + butcher) down to $100, I did let OH out of my sight and he spent another $100 at the greengrocer and somehow apparently his car just magically stopped at a garden centre for some more things, but it's all well within budget. I think things for the house count as guilt free for him, and it's hard to get cross at someone for buying potting mix! So I didn't.

Today we took the DDs out for a cycling lesson, and DD1 finally, FINALLY got the hang of cycling without trainers! She's eight, so we've been trying to teach her for approximately a billion years. I suggested celebratory afternoon tea and DH made us go home where he made coffee and pancakes, good man.

I'm converting an old cubby house into a second chicken coop - the Maternity Ward, DH calls it, because I'm going to try and raise littlies in it. I think I can do it entirely out of odds and sods we have lying about the place without it costing a cent, and then I'll try and find a few dollars for some chicks next month. I have a couple of friends who'll buy eggs from me if I have a surplus, so it'll pay for itself if not make me some cash.

Oh and I made a big vat of lentil soup and a pan of rice pudding to start us off on the weeks lunches, so I'm feeling very smug.

Kittenkirst · 12 February 2017 at 2:31PM

The maternity ward sounds like a great idea!

Very envious of your rice pudding, such a lovely treat

Allotrope · 12 February 2017 at 9:49PM

Sounds great.. am now following

good luck on reigning in DH...!

armchairexpert · 13 February 2017 at 12:34AM

Thanks so much, Kittenkirst and Allotrope - I haven't quite worked out how to see if someone has a diary of their own, would love to see what you're up to if you have one!

newgirly · 13 February 2017 at 8:48AM

Hi armchair expert, best of luck with the new diary

armchairexpert · 14 February 2017 at 12:42AM

Today the CC got paid off from the main account. This happens monthly: we run almost everything through the CC, then it is set to pay off from the mortgage account (which is a LOC). Fine. No dramas. YNAB is set up to reflect the real position either way, it doesn't matter whether the debt is sitting in Account A or Account B.

What it means, though, is that the mortgage debt is now at its highest point in two years. It's often difficult to see this properly when I'm not running a budget and I'm realising how easy it's been to convince myself that actually we're doing much better than we are. Today's figure, although I could already see it in YNAB, was sobering to see on the actual bank statement.

I feel like I should be over on DFW, in that I'm turning around bad habits that have crept up over time. I was lucky to buy my first house very young, before the housing boom, and that's cushioned every decision since. But I need to get a handle on this and make sure the numbers start going DOWN!

(To be fair, this month saw us pay off the December bill, which included not only Christmas, but unexpected travel expenses for a funeral, already-committed-to holiday and also $1500 on costs associated with a new car. Once I sell the old car, for which I'll get a couple of grand hopefully, it'll look better. I'm just waiting for a couple of replacement bits to come in the post, because I need to fix a few things so it'll sell. It's woefully old, and - amongst other things, like it leaks - the gearstick has crumbled! So I need to replace that. But none of that negates the larger point, that I've been ignoring the lack of forward direction in the mortgage for at least a year).

The ups, downs, and occasional sideways bits of trying to be mortgage free

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