Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 8th Sep 12, 12:07 PM
    • 551Posts
    • 2,416Thanks
    SuperSecretSquirrel
    Onwards to freedom!
    • #1
    • 8th Sep 12, 12:07 PM
    Onwards to freedom! 8th Sep 12 at 12:07 PM
    Hello and welcome to my MFW diary. Not sure how often I'll update as I'm going down the boring 'increase monthly mortgage direct debit' route, not the more interesting to read 'random repayment as and when a bit of extra money is made' route. Still, no harm in starting a diary here, even if it's just for me to look back on in a few years time!

    It seems like a good idea to start with a bit of background, so here goes...

    We bought our house in July 2010 with an 87k repayment mortgage, fixed for 10 years at 5.29%. Nearly two years of £525pm standard repayments allowed us to rebuild our savings, but after 20 monthly payments (over 10k paid out) the mortgage balance had only dropped around 2.5k thanks to all the interest being paid...

    We decided to make a small start on overpaying - small overpayments early on have quite an impact over the long term so why not start small and ramp up later? March 2012 we made our first regular overpayment, £50pm. Amazingly, if we were to keep up with this £50pm over the life of the mortgage we'd be mortgage free nearly four years early (Nov 2031) and save ourselves a tidy bit of interest. Not bad rewards for just £50 a month!

    A few days ago I decided to step things up a notch. From next month the regular overpayments will increase to £250pm, £200 less will find its way into my long term savings (paying 2.8%, minus basic rate tax), £200 more will find its way to the mortgage provider. Makes a lot of sense looking at the interest rates! I'll keep on saving in a normal savings account though and won't be putting every penny into the mortgage - I'm used to seeing my savings grow monthly, and like to try to be prepared for any eventuality, so I'll keep on squirelling away a chunk of my income in savings each month. I know this isn't the most efficient option in terms of reducing interest payments, but it's a balance that keeps me sane, if there's any major disasters the savings are there to fall back on, that kind of peace of mind is well worth a few pounds! Anyway, here's where the numbers get really interesting - by overpaying £250pm for the life of the mortgage we'd be mortgage free nearly eleven years early (Oct 2024). Wow!

    Seeing the massive savings I started looking into this stuff in more detail. We're allowed to overpay up to 10% of the mortgage balance each year without penalty. I don't want to increase overpayments over £250pm right now, but maybe after another year or so of growing my savings I'll step up the overpayments to £500pm. Two years later the overpayment would need to drop to £450pm (to avoid penalty), year after that drop to £400, and the following year drop to £350, and the years after that drop to £250 at which level the op's would have to remain until the end of the fixed period (August 2020). If we were to follow this plan, at the end of the fixed period our mortgage balance would be around about 20k which we could pay off with a lump sum from savings. Mortgage free fifteen years early, at age 36, sounds awesome, and what's incredible is that it also sounds very realistic.

    At the moment overpaying is my project. OH and I have our own accounts that our wages are paid into, and a joint account that we feed monthly to pay the bills. As I earn a little more I also do the grocery shopping, pay a few extra bills, and overpay the mortgage. Beyond feeding the joint account OH's income is none of my business, it can be spent on whatever OH likes, same goes for my income. This works well for us - if I want to splash out on a new computer game or a night out or whatever I can do so without needing to consult OH, and if OH wants to splash out on a night out or clothes or whatever no need to consult me. We're both debt averse and savers by nature, so as long as we spend less than what's coming in and all the bills get paid all is well. I'm hoping that seeing the mortgage balance reduce might convince OH to get involved in overpaying the mortgage (or at least split savings into two pots, one 'spendable' short term pot for holidays and home improvements etc, and a long term one earmarked for paying down a lump sum on the mortagage), but there'll be no pressure, if OH joins in that would be excellent, but if not that's ok.

    Finally, I know life doesn't always go smoothly - anything could happen in the next 8 years, babies, redundancy, armageddon, "the best made plans of mice and men, often go awry"... But if things don't go to plan, nevermind, we'll have made a great start on the mortgage regardless, any overpayments we make early on will benefit us later on, so we may as well give it a shot while circumstances allow It's nice to remember that circumstances can go up as well as down too - maybe there will be payrises and good fortune along the way that make achieveing the target easier, who knows!

    ----------

    January 2014 Update:

    Things have changed quite a lot since I first started this diary... The new aim is to hit the MFiT3 target of a 40k mortgage balance by end 2015, and to have 40k in savings by that time too, making us mortgage neutral 20 years early! Anything can happen, but I think it's time to aim high!

    ----------

    March 2015 Update:

    We did it! We are mortgage neutral (savings balance higher than outstanding mortgage) and are locked in to achieve the MFiT3 stretch goal of mortgage below 40k by the end of the year I'm going to keep this diary going, the aim is total financial independence now!
    Last edited by SuperSecretSquirrel; 20-05-2015 at 8:14 AM. Reason: We did it! :D
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
Page 23
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 29th Jun 17, 10:45 AM
    • 551 Posts
    • 2,416 Thanks
    SuperSecretSquirrel
    Hi SJ, thanks for stopping by

    Thanks to Ed for chipping in too

    I was asked what credit limit I would like when opening a 0% no fee BT card back in April. I asked for double what I needed, expecting to be offered half my requested amount, but they offered me the full amount!

    I don't think I specified a desired amount for any of the three cards I opened this month. They offered me a total of 25k right off the bat, and I felt that was plenty to be getting on with for now.

    I currently have a total credit limit of 45k across five cards, and a current credit balance of 24k. The three 0% BT cards are all pretty much maxed out (total balance at 90% of CL). There's about 10k of slack available on my 0% spending slow stooze card. The mule card has a zero balance - it's not at 0%, so carrying a balance would be bad. There's 8.5k of available credit not being utilised on the mule - if getting further credit becomes difficult I might ask them to drop the CL a little.

    I found it scarily easy to be offered these credit limits. Doing what we're doing, it's fine, but it's easy to see how people can quickly get themselves into a mess!

    Of course, it's vitally important to ensure you can pay off the balances as and when required, so do consider carefully where you stash the pot. Good luck!
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 1st Jul 17, 9:12 AM
    • 551 Posts
    • 2,416 Thanks
    SuperSecretSquirrel
    Net Worth Update - 1st July 2017
    Code:
                   CURRENTVALUE       +/-MTH       +/-QTR       +/-YOY
    House Value:    £125,000.00        £0.00        £0.00        £0.00
    Cash:            £42,651.90     -£462.71   -£2,017.60   -£3,026.48
    Pensions:        £69,749.09      £270.85    £2,825.31   £21,372.59
    Car Value:       £15,085.00     -£360.00   -£1,080.00    £5,285.00
    S&S:             £19,373.50      £806.13    £3,069.11   £10,169.85
    Mortgage:       -£18,680.39      £746.54    £2,227.15   £11,218.20
    Due to HMRC:       -£411.89       £82.52       £76.71      -£38.70
    Student Loan:      -£645.39       £86.80    £1,350.15    £1,909.52
    Total:          £252,121.82    £1,170.13    £6,450.83   £46,889.98
    84.0% of the way to 300k net worth (2020 challenge), 14.9% mortgage ltv, £42,933.12 beyond mortgage neutral in liquid assets, 15.6% financially independent.
    __________________________________________________

    June wasn't a spectacular month, but they can't all be! Happy to say we're still heading in the right direction

    This was the third month of recording all our spends, and I've noticed that although not all months are created equal (car costs, insurances, christmas, birthdays, holidays, etc, all spread out unevenly throughout the year) we seem to have a fairly steady baseline so far. Will be interesting to see if this holds over a full year!

    In June we spent:
    £1524.28 on bills (run a home and two cars - inc £828.48pm accelerated mortgage)
    £304.92 on weekly shops (food, cleaning products, toiletries, nappies, etc)
    £403.54 on everything else

    Hope you're all making good progress!
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
    • edinburgher
    • By edinburgher 1st Jul 17, 9:37 AM
    • 10,651 Posts
    • 55,316 Thanks
    edinburgher
    What if anything do you spend on home maintenance/improvement? I know my view is coloured by updating a 70s house, just curious to see how others fare. I.e. small repairs, paintwork touch ups, necessary purchases of tools for DIY/gardening etc.
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 1st Jul 17, 4:23 PM
    • 551 Posts
    • 2,416 Thanks
    SuperSecretSquirrel
    That's where the spending can get quite lumpy I guess Ed. In the past three months there hasn't been anything too major, but I'd estimate around 8-9k spent on that kind of thing over the past 7 years. New bathroom, replastering some internal walls, new carpets, painting the exterior of the house, a fair amount of landscaping, a little redecorating, etc.

    I guess once we have a years worth of spending recorded, we'll need to add a buffer on top to cover irregular expenditure. That should give us a fairly realistic ballpark annual spend figure.

    Edit: Replacing cars would fit into this lumpy category too, and maybe out of the ordinary once in a lifetime type holidays too. Then there's helping out the children as they reach university or house buying age... I can see how life usually ends up being an eternal hamster wheel
    Last edited by SuperSecretSquirrel; 02-07-2017 at 9:54 AM.
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
    • Calfuray
    • By Calfuray 5th Jul 17, 6:33 PM
    • 964 Posts
    • 5,863 Thanks
    Calfuray
    Just finished reading your diary SSS - thanks for the kick up the backside
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 7th Jul 17, 9:55 PM
    • 551 Posts
    • 2,416 Thanks
    SuperSecretSquirrel
    Thanks for reading along Cal - looks like you're back with a vengeance!

    So, umm, I was at a loose end a little earlier today, and found myself back on the credit club... Another couple of cards are on their way - that's a further 16k-ish to be added to the stooze pot very soon My next credit score update could be a shocker!
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 21st Jul 17, 8:54 AM
    • 551 Posts
    • 2,416 Thanks
    SuperSecretSquirrel
    That's all the 0% BT cards well and truly rinsed

    I've paid £151.34 in fees, and £5.27 in interest (a little more may be added next month, but it shouldn't be much as I avoided the weekends this time, and arranged the BTs while the MTs were still in progress). I'm also expecting £25.25 cashback. Overall cost of £131.36 to borrow £30,270 (minus min repayments) over two years.

    Minimum repayment DDs setup, and reminders to pay off or BT balances at end of 0% periods arranged.

    Total stoozed balance now stands at £39,824.62

    PB's will be maxed out after a regular saver matures this weekend, and will remain maxed until the mortgage payoff in January. They will be depleted over time, as and when stooze cards need repaying, or I find better homes for the cash.

    Tried my luck applying for the remaining 0% BT deals available to me, offered ~£500 CLs so didn't bother submitting applications. Just as well really as I've run out of places to stash the cash for the next six months!

    I think I'll just sit back and wait for some PB wins now while the automated systems keep things ticking over for a couple of years.

    I will keep crawling along with the slow stooze of course
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
    • edinburgher
    • By edinburgher 24th Jul 17, 10:25 AM
    • 10,651 Posts
    • 55,316 Thanks
    edinburgher
    My credit score dropped from 850 to 450 or so

    Planning on killing the MT card, as it would drop my total credit available by £5,000 and hopefully start the journey of rebuilding said score. Realistically, the next time we will need access to credit will be the end of 2020 when we remortgage.
    Last edited by edinburgher; Today at 10:31 AM.
    • SuperSecretSquirrel
    • By SuperSecretSquirrel 24th Jul 17, 12:56 PM
    • 551 Posts
    • 2,416 Thanks
    SuperSecretSquirrel
    Hi Ed Yikes!

    Mine has dropped from 890 to 790 so far, but the last update was made when things were still in motion...

    Since then 3 cards have been added, credit limit increased by 26.5k, borrowing increased by just over 25k, and percentage credit used gone from 41% to 65%. No doubt my credit score has a long way to fall!

    Like you, I foresee no need for credit in the near future, so who cares

    I guess consistently making the repayments will bump it up a little over time, and like you I will most likely close the mule card (or reduce the CL drastically) since it's no longer of much practical use.

    This stoozing business has certainly made the "boring" bit of the last couple of months a little more interesting. I like having cause to update my spreadsheets
    Mortgage [2013 £64k|2014 £51k|2015 £38k|2016 £26k] £17,912.48
    MN [2013-£25k|2014-£2k|2015+£16k|2016+£34k] +£42,603.43 (MFiT4:+60k)
    NW [2013 £126k|2014 £156k|2015 £190k|2016 £228k] £252,121.82 (2020:300k)
    FI [2013 -1.2%|2014 2.8%|2015 6.9%|2016 13%] 15.6%
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

2,680Posts Today

9,053Users online

Martin's Twitter
  • Byebye! I'm about to stop work & twitter, to instead spend glorious time with Mrs & mini MSE. Wishing u a lovely summer. See u in 10 days.

  • WARNING Did you start Uni in or after 2012? The interest's rising to 6.1%; yet it doesnt work like you think. See https://t.co/IQ8f0Vyetu RT

  • RT @JanaBeee: @MartinSLewis Boris is the anomaly (coffee), the others are versions of normal (beer). Lots of same candidates = vote share d?

  • Follow Martin