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  • FIRST POST
    • pinknsparkly
    • By pinknsparkly 15th May 17, 6:08 PM
    • 52Posts
    • 193Thanks
    pinknsparkly
    PinknSparkly's Mortgage Wannabe savings dairy
    • #1
    • 15th May 17, 6:08 PM
    PinknSparkly's Mortgage Wannabe savings dairy 15th May 17 at 6:08 PM
    So this is a savings diary with the intention of getting my husband and I into debt (i.e. a mortgage) as soon as possible

    I am currently finishing up a PhD and as such we won't be in a position to apply for a mortgage until I have been employed for at least 6 months. In addition, I am now at the fun stage of my PhD where I have no income (my bursary/stipend finished in March this year). This puts us in a position where our outgoings are more than our income. We knew this would happen and have pre-planned for it by building up a pot of savings to get us through this.

    My aim therefore, is to use up the minimum possible amount of savings to get us through until I am employed and to then save as much as possible towards a house deposit.

    I estimate that each month we will need to use around £250 - £300 from our savings to cover the short-full in our income.

    Current savings: .................................................. ............£38,000

    Property value: .................................................. ............£275,000
    Stamp duty: .................................................. .....................£3,750
    Other house purchasing expenses: ......................................£2,250
    (assuming £1000 legal fees and £1,250 for everything else)

    House deposit:.................................................. ................£32,000
    (total savings minus house purchase costs)
    LTV:.................................................. ....................................88%

    As you can see, we're already in the excellent position of having a 10% deposit. However, since we will have a minimum of 6 months of two full time incomes before we can get a mortgage, I hope to be able to get us up to a minimum of a 15% deposit by the time we apply. This is a very ambitious target of saving £10,000 in six months (plus whatever we've spent from our savings in the meantime), but what's the point in aiming low, right??

    What do you guys think of the plan? Do my estimates for house purchasing-related costs seem reasonable?

    In the meantime, I'm doing my best to get back to meal planning and making lunches to reduce our expenses as much as possible. The car is also being used as infrequently as possible to save on petrol (I'm mostly working from home at the moment). We've minimised how much we spend out and about (though my husband still ends up getting food out of the house probably once a week or so). We've also planned for no "proper" holidays this year (other than a week camping in South Wales). I'm going to a conference abroad which will be paid for, so that will satisfy my inner travel bug and my husband is quite happy spending his time off at home.
Page 2
    • pinknsparkly
    • By pinknsparkly 17th Jul 17, 5:55 PM
    • 52 Posts
    • 193 Thanks
    pinknsparkly
    What do people out there think of websites such as inboxpounds and ladycashback, where you get paid for reading emails (typically 1p per email)? I've finally reached the £20 required to get a payout from ladycashback and also managed to get my £20 payout from inboxpounds. However, I decided when I set them up that once I'd got to the first payout, I would close my accounts. It just takes sooooo long to build up the balance, I can't deal with the clogging up of my inbox/junk mail folder any more!


    On the plus side, it's £20 more into my savings that I didn't have this morning


    I've also managed to unearth £130 in Chef and Brewer vouchers (I exchange my Tesco clubcard points for Chef and Brewer vouchers as we have a gorgeous Chef and Brewer pub near us). It isn't money saving so much as money-spending as we'd probably not bother going out for dinner without the vouchers, and we still have to pay for drinks, but we've kind of tailed off on the date night front the past few months so this will be a nice, fairly cheap, way of restarting! I've already booked us in for the weekend after next
    Plan: buy a house in summer 2018
    Realistic savings goal: 10% house deposit. DONE
    Super ambitious savings goal: 15% house deposit. Currently on 11.9%





    • savingwannabe
    • By savingwannabe 17th Jul 17, 8:35 PM
    • 13,112 Posts
    • 46,662 Thanks
    savingwannabe
    Well done on the vouchers for nice meals. I didn't even know you could get paid for reading emails I hope you enjoy the money. Fab. Every bit helps.
    Happiness Fund (Dec 1st 2017)
    Reminder: I HAVE EVERYTHING I COULD WANT so SAVE!!!!
    • pinknsparkly
    • By pinknsparkly 3rd Oct 17, 2:50 PM
    • 52 Posts
    • 193 Thanks
    pinknsparkly
    I've not visited MSE for a while so am checking in. I've just seen a post on the mortgage free wannabe forum (I LOVE that forum, I can't wait to be at the point of exchanging my savings for a gigantic mortgage and be needing to pay it off - it sounds very masochistic written out in black and white!) that got me thinking. The poster was asking about whether or not she should overpay her mortgage, or if there was a better way to achieve her plans of selling up and moving out of london in 5-10 years time. It got me to pondering whether my view on houses and house buying is somewhat different to that of other peoples.....

    I've always taken the view that I have to pay for a roof over my head, whether it's for rent or a mortgage. Therefore, if the total amount spent on buying a house (fees, stamp duty etc) plus the total amount paid in mortgage INTEREST over the minimum amount of time for which you intend to stay in the property plus estimated total costs of NECESSARY repairs to the property minus the total amount of any income you get from taking in a lodger/renting out a driveway etc etc is less than the total amount spent on renting an equivalent property for the same period of time then buying is a no brainer.

    Then on top of that, the repayment part of the monthly mortgage payment is essentially you paying into a savings account (albeit, one akin to a 5 year fixed term bond that you can't access).

    The longer you stay in the property the cheaper the monthly cost will (probably) be, since the interest will be lower and the total amount spent on purchasing the property is averaged over more months. But you will also have more repairs to make! On the flip side, if you are renting then you have to pay out well over £1000 each time (in my experience) you move house simply to be allowed to move in so if you move frequently, that would probably cancel out the cost of any repairs needed for a property you owned.

    I realised that I've never banked on house prices rising, simply that long term buying works out cheaper (and more secure) than renting. I do however, also ignore the risk of house prices decreasing since I would only consider buying a property in which I'd be willing to wait out any price crash if necessary. Any price increase would simply be a nice bonus!

    Running some numbers through the MSE mortgage calculators, even an interest rate of over 5.5% we'd still be financially better off buying a house for five years than renting. On top of that, we currently have a lodger who wants to continue living with us long term who pays us £500/month. Assuming we didn't increase it at all, we would remain financially better off buying than renting on an interest rate of over 7.5%
    Plan: buy a house in summer 2018
    Realistic savings goal: 10% house deposit. DONE
    Super ambitious savings goal: 15% house deposit. Currently on 11.9%





    • savingwannabe
    • By savingwannabe 6th Oct 17, 9:30 PM
    • 13,112 Posts
    • 46,662 Thanks
    savingwannabe
    Hello, good to see you posting. Smart thinking. I agree with your analysis but it will feel harder sometimes as the grass always seems greener on the other side. For example, when a pipe bursts and you have to pay to sort it.

    I don't regret buying my house and feel v fortunate sometimes though I do feel it's a bit of a millstone but then I remember it's for life.
    Happiness Fund (Dec 1st 2017)
    Reminder: I HAVE EVERYTHING I COULD WANT so SAVE!!!!
    • pinknsparkly
    • By pinknsparkly 28th Jan 18, 11:02 PM
    • 52 Posts
    • 193 Thanks
    pinknsparkly
    Hi everyone! So the end is FINALLY in sight for my PhD, and I will be submitting my thesis in the next week or so alongside starting paid employment again on Monday 5th February

    Once my thesis is in, I intend to start being a lot more aggressive with my savings plans, and to try increasing my income as much as possible (currently I'm considering a number of things including stoozing, matched betting and opening a few bank accounts for the welcome offers). I want to start investing for our long term future so my plan is that any additional money I make on the side will be invested. I'm interested in investing in dividend paying stocks and low cost tracker funds but I need to do a lot more research into that first! And the additional money I make from my actual job will go directly into saving for a house deposit (and going to America in the summer for a wedding and festival, woop woop - it'll be our first holiday ANYWHERE in over two years. I guess it counts as our honeymoon as this coming Tuesday will be our first wedding anniversary!). I need to sit down and do a proper working out of where we are at in terms of savings, as we've had to use some of our savings recently to get us through the period of me being unemployed (i.e. studenting!). But onwards and upwards!
    Plan: buy a house in summer 2018
    Realistic savings goal: 10% house deposit. DONE
    Super ambitious savings goal: 15% house deposit. Currently on 11.9%





    • savingwannabe
    • By savingwannabe 29th Jan 18, 8:44 AM
    • 13,112 Posts
    • 46,662 Thanks
    savingwannabe
    Hurrah for nearly end of thesis and for getting a job. Marvellous news.

    Oh yes Sinking Funds are those expenses Dave Ramsey says we can plan for eg. Christmas, insurance, holidays, medical fees. If we save in advance for these they will not catch us out when they eventually occur and we can continue to save or pay off debt without problems.

    I don't know anything about stocks and shares other than they are a risky I would avoid them until I had more savings? but that is my personal opinion. It's great news about your holiday. Something great to look forward to. Happy Anniversary for Tuesday. Hurrah.
    Last edited by savingwannabe; 29-01-2018 at 8:49 AM.
    Happiness Fund (Dec 1st 2017)
    Reminder: I HAVE EVERYTHING I COULD WANT so SAVE!!!!
    • pinknsparkly
    • By pinknsparkly 30th Jan 18, 1:11 PM
    • 52 Posts
    • 193 Thanks
    pinknsparkly
    Thanks SW, turns out I do have sinking funds already then! I just call each fund by what I've allocated it to (e.g. car maintenance/insurance etc).

    And yes I agree with you completely about stocks and shares being risky, but on the other hand the longer you hold them for the less risky they become as they've got more time to recover from any nose-diving! That's why I'm only intending to put "extra (i.e. made on the side)" money into them to start with until I get a feel for what I want to do with it. In an ideal world I'd love for us to not *have* to work and to be able to retire early (I'm 31 at the moment so this is quite a long way in the future, and any pensions won't kick into until I'm pushing 70!). So I'm viewing this as a way of hopefully working towards this. And if it's not enough to retire early on then we would have the money available for holidays/cost of living in retirement instead. We already have sufficient savings if we needed them in an emergency (they're currently "allocated" to house deposit, but the idea is that we could also use that money in an emergency for a new car or something) so I feel comfortable doing this.

    All the additional money I'll be getting from being employed again (HURRAH!) will all be going into normal savings for a house deposit (plus some for holidays!).

    And thank you for the wishes, I can't believe we've been married a year already
    Plan: buy a house in summer 2018
    Realistic savings goal: 10% house deposit. DONE
    Super ambitious savings goal: 15% house deposit. Currently on 11.9%





    • atrixa
    • By atrixa 3rd Feb 18, 2:10 PM
    • 23 Posts
    • 19 Thanks
    atrixa
    In an ideal world I'd love for us to not *have* to work and to be able to retire early (I'm 31 at the moment so this is quite a long way in the future, and any pensions won't kick into until I'm pushing 70!). So I'm viewing this as a way of hopefully working towards this. And if it's not enough to retire early on then we would have the money available for holidays/cost of living in retirement instead.
    Originally posted by pinknsparkly
    Looks like we have similar goals for later life If I can be mortgage and rent free well before my retirement age I can hopefully reduce working hours by quite a bit if not retire early. I'd hate to be working full time past 60ish.
    I work in Pensions and I'm currently saving for my first house deposit
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