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
    • VDOT47
    • By VDOT47 30th Oct 17, 1:32 PM
    • 45Posts
    • 44Thanks
    VDOT47
    Mortgage Free by 55
    • #1
    • 30th Oct 17, 1:32 PM
    Mortgage Free by 55 30th Oct 17 at 1:32 PM
    Hi all,


    As the title would suggest, my aim is to be mortgage free by 55! Having read through a few diaries on here, I thought that starting my own might help me to keep focussed.


    Right, background info! I am 35, OH 32 and DD 2. We moved house earlier this year, with a mortgage of £269,995 (with fees). We are on a 25 year mortgage with an initial 5 year fix at 2.19%, meaning repayments of £1169.xx per month.


    I have just registered for online banking, so once the passcodes come through in the post I will find out the exact balance, but I estimate we are currently on c.£264,000 with a repayment date of Feb 2042!!


    I don't intend to do a full SOA at this stage (maybe in the future) but will say that we are in the fortunate position that we can currently put £550 pcm into regular savers and have current easy access savings of c£7000.


    The aim over the next 12 months is to get the savings up to £15,000 (from the regular savings accounts maturing and also from a bonus I should get from work next summer) and keep that as our emergency fund. From that point, whenever a regular saver matures (or I get a bonus) I intend to stick that directly into a lump sum overpayment, unless the emergency fund needs topping up of course (which it will do, as we need to do a couple of bits and pieces to the house still over the next couple of years).


    In the meantime, I intend to make ad hoc overpayments as and when possible, hopefully averaging about £100pcm.


    My motivation for this is of course to be mortgage free by 55 in order to then make saving for retirement easier (I have a work pension but not much else, although OH runs her own business which hopefully would have value when we reach retirement or could be passed to DD if she wanted to run it), but in the interim it is to allow us to build up as much equity as possible so as to be able to move again within 5 years.


    The reason for this is twofold:
    1) We always intended that this move was another step on the ladder, rather than our 'forever' home, and we originally thought we would live here for 10 years then move;
    2) However, we (well, I in particular) are not happy where we have moved to. The area is SO noisy throughout the day (and during the evening over the summer too) with children shouting and screaming and frankly the noise is doing my head in! Also, we are in a semi so there is some noise through the wall too.


    Think that is enough to start with, any comments would be welcomed and I will hopefully post a little more in due course!
Page 2
    • VDOT47
    • By VDOT47 20th Nov 17, 11:30 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Morning all - another money saving week ahead!


    This weekend was quite productive, and included booking a holiday for next year. It did mean paying the deposit of £180 now (the balance is not due until August), but it did mean we could use a voucher for £60 off the balance, as we had to use it by the end of this month, so we decided to just take the plunge yesterday!


    Saturday was only an £11 top up shop (and kept total weekly spending about £5 below budget) and yesterday was a NSD completely.


    Checked our online mortgage balance yesterday and noticed some thing strange. I have made 4 mini overpayments so far (totalling only £20.98) but only £10 has actually been credited against the balance of the mortgage, with the other £10.98 showing as "Overpayment waiting to be allocated" or something similar. Any ideas why this may be? Do Santander only apply overpayments in multiples of £10 or something? Has anyone else with them had this issue. It is not something that really concerns me if I am making small payments, but when I start making larger ones (which will happen from the new year once my new salary kicks in and Christmas is out of the way) I want to make sure the full amount gets credited to the account immediately, rather than sitting in some kind of holding fund for a period of time?
    • VDOT47
    • By VDOT47 22nd Nov 17, 2:11 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Shopping for the week has come in quite low so far, but we are meeting friends on Sunday afternoon which will probably involve some spending at the pub on food/drink, so maybe we won't save as much this week as I had hoped.


    Changes in the Budget to personal allowance and income tax thresholds will make a small difference from April, and anything extra in my wages as a result of that can be siphoned straight into overpayments.


    OH is also amazingly ahead of herself with Christmas shopping etc too, so hopefully we won't have a massive bill in December for presents, food etc.
    • greent
    • By greent 23rd Nov 17, 8:13 AM
    • 6,514 Posts
    • 65,741 Thanks
    greent
    Can't answer your query about Santander OPs, sorry - I had my first mortgage briefly with Abbey National (showing my age!) but only for about 6 months - and long before online banking! Am sure if you phone them they could answer the question - and hopefully then allocate it properly whilst on the phone. Worth phoning to check what you need to do to make sure it doesn't happen again?
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) Bal 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    Next: BTL Mtge 12/16 £69786. 2017 OPs (#18) £5278/£3286
    Net sales 2017 £1445.57/£500 PAYDOX17 £12239/£10k Decluttered 1870/2017 items
    • VDOT47
    • By VDOT47 23rd Nov 17, 12:53 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Thanks GreenT - will do.


    Just spoken with the surveyor who visited this morning and apparently we will be eligible for free cavity wall insulation, so hopefully that will save us some money on energy bills over the years :-)
    • louloubelle79
    • By louloubelle79 23rd Nov 17, 2:04 PM
    • 257 Posts
    • 127 Thanks
    louloubelle79
    Just found your diary, good luck with you journey.
    Hoping to be mortgage free by 2026 age 47
    Current rate 2.79% fixed for 10 years
    Current mortgage end date: 03/10/2043
    MFW Starting Mortgage Jan 17 - £114,703
    2017 OPs £6000
    Jan 2018 balance- £105,923
    • VDOT47
    • By VDOT47 23rd Nov 17, 3:36 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Thank you - I think it will be pretty slow progress initially, but every little helps.
    • greent
    • By greent 23rd Nov 17, 5:44 PM
    • 6,514 Posts
    • 65,741 Thanks
    greent
    We had most of the cost of our cavity wall insulation covered by a gov grant and it did make a noticeable difference to how the house felt after
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) Bal 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    Next: BTL Mtge 12/16 £69786. 2017 OPs (#18) £5278/£3286
    Net sales 2017 £1445.57/£500 PAYDOX17 £12239/£10k Decluttered 1870/2017 items
    • VDOT47
    • By VDOT47 24th Nov 17, 8:55 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Right, I have the answer.


    I got home last night to a letter from Santander saying that they had applied £10 as an overpayment and recalculated our monthly payment to take this into account. It said that, if this wasn't how we wanted the overpayments to be treated then we should call them, so I did.


    It is now set up that all overpayments will go towards reducing the term instead.


    Annoyingly, the girl on the phone said that after each overpayment I would get a letter confirming the reduction in the term! I asked if this was really necessary, and not just a waste of paper, but she said that was how their system worked. So I think, to avoid being bombarded by letters, I will just made one overpayment each month rather than ad hoc ones as and when.


    Also upped our DD to £1200 pcm from December, so we will be making a small overpayment each month just through that, regardless of other amounts.
    • VDOT47
    • By VDOT47 24th Nov 17, 9:57 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Been considering opening some new current accounts to take advantage of the various offers - we have c£7000 in an easy-access savings account earning the square root of nothing each year, so I think I am going to open some Tesco and Nationwide current accounts and transfer some of the savings into each in order to earn 3% and 5% interest respectively. Also would get us access to Nationwide's 5% regular saver, which is better than the 4% one I have access to with Halifax.
    • VDOT47
    • By VDOT47 27th Nov 17, 9:49 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Morning all,


    Two good pieces of moneysaving news:


    1) Nationwide FlexDirect account applied for, and I have persuaded OH to open one too, so that can be a harbour for a further £2500 of savings. So between them that should earn us £250 of interest over the next year (rather than the £10 or so it would earn where it is currently sitting). The only catch is that OH says I have to be the one to spend the time doing the transfers in and out every month to satisfy the account conditions.
    2) Pay rise, expected from next month, has actually taken effect from this payday!


    So, should be able to make a good overpayment this month after all :-)
    • VDOT47
    • By VDOT47 27th Nov 17, 9:50 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Oh, and when OH opens the Nationwide account I should get £100 cashback from referring ' a friend' :-)
    • VDOT47
    • By VDOT47 27th Nov 17, 10:33 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Combo of payrise and other bits of money saved in various accounts this month, have allowed a £400 overpayment today, which makes a total of £420.98 in November.
    • VDOT47
    • By VDOT47 29th Nov 17, 12:50 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Have had an email from Nationwide confirming the account has been approved and should be getting stuff in the post shortly to allow me to get it fully open, and transfer in the £2500.


    Also had letters from Santander confirming our new monthly DD and that all overpayments are to go towards reducing the term.


    Think it is about time to start setting myself mini targets along the way to mortgage freedom. Currently I think our balance will get into the 250ks in April/May, and I have set myself the aim to get there by the end of March.
    • greent
    • By greent 29th Nov 17, 1:05 PM
    • 6,514 Posts
    • 65,741 Thanks
    greent
    Targets are always good - when you get into the next £10k down, when your daily interest equals £x, when you can knock another month off the end date - all little things to keep you motivated along the journey
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) Bal 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    Next: BTL Mtge 12/16 £69786. 2017 OPs (#18) £5278/£3286
    Net sales 2017 £1445.57/£500 PAYDOX17 £12239/£10k Decluttered 1870/2017 items
    • VDOT47
    • By VDOT47 4th Dec 17, 10:57 AM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Thanks Greent - had a letter from Santander over the weekend confirming the application of the overpayments to date, and showing the estimated end date for the mortgage. The date hasn't moved yet, but it shows the estimated final payment being £5xx rather than £1169, so I can see that by overpaying £420 last month it has reduced the final payment by over £600. Good to see the theory in practice!


    Probably won't be able to overpay quite as much this month (what with extra Christmas spends) but hoping that our overpayment at the end of December will actually knock the first month off the end date!


    Weekend was relatively low spend.


    Nationwide account open, but can't seem to get registered for online banking and don't want to send the £2500 to the account until I can get this set up. Will need a call to them I think.
    • VDOT47
    • By VDOT47 5th Dec 17, 4:19 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Received a letter yesterday from Nationwide enclosing internet banking login details, but I still cannot get it set up as you need to either input Memorable Data (which I haven't chosen yet I don't think) or use a card reader (which they haven't sent me)! Hopefully they will send this to me shortly. WHY do they have to make everything so bloody difficult these days!!!


    In moneysaving news, we have a pretty quiet week planned so fingers crossed for a reasonable overpayment this month!
    • VDOT47
    • By VDOT47 6th Dec 17, 2:17 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Still no card reader. Will have to call or go into branch later this week to establish what the problem is and how I manage to register for online banking. Also need to investigate how we go about getting the £100 bonus for recommending a friend, by getting OH to open an account too.


    Yesterday was a NSD (apart from petrol to get to work and back). Only 77p spent today on snacks to supplement lunch brought from home. Tonight we are eating pasta with a sauce that we made a batch of a couple of weeks ago, so freezer dinner which will be very cheap. Quite a good money saving couple of days I think!
    • VDOT47
    • By VDOT47 7th Dec 17, 1:30 PM
    • 45 Posts
    • 44 Thanks
    VDOT47
    Nothing to report, except for a low spend day (£1.11 at lunch), but I have been having some ideas around setting myself mini targets for the end of each year of the mortgage term for the next 5 years.


    So:


    Year Balance if no overpayments Actual balance at year end


    1 (to Feb '18) £261,789 £259,000


    2 (to Feb '19) £253,402 £243,500


    3 (to Feb '20) £244,830 £227,000


    4 (to Feb '21) £236,068 £208,000


    5 (to Feb '22) £227,113 £187,000




    This is calculated on the basis that each year I would hope to be able to overpay a little more than the last, due to payrises and the effect of the compound interest reduction starting to make a little more of an impact.


    This therefore predicts overpayments of basically £40,000 over 4 and a bit years (as I didn't overpay anything in the first 8 months of the term) or about £9000 a year! Sounds a lot when I write it down like that!!
    • shangaijimmy
    • By shangaijimmy 7th Dec 17, 2:08 PM
    • 2,281 Posts
    • 10,616 Thanks
    shangaijimmy
    I agree it sounds a lot!! Still it helps to get the mind focussed to the task at hand!
    MFW: Turning June 2036 into March 2023... 33//120 Payments Challenge, Diary Reduction £35,448.08
    Aug 2009: £163,051 // Current: £100,551.94 // Avg Daily Interest £4.52
    MFiT-T4 #8 - 56.74% of £41,000
    • greent
    • By greent 7th Dec 17, 5:44 PM
    • 6,514 Posts
    • 65,741 Thanks
    greent
    It sounds a lot, yes - but it's surprising what you can achieve once you set your mind to it
    I am the master of my fate; I am the captain of my soul
    Repaid mtge early (orig 11/25) Bal 01/09 £124616 01/10 £104927 01/11 £89873 01/12 £76317 01/13 £52546 01/14 £35356 01/15 £12133 07/15 £NIL
    Next: BTL Mtge 12/16 £69786. 2017 OPs (#18) £5278/£3286
    Net sales 2017 £1445.57/£500 PAYDOX17 £12239/£10k Decluttered 1870/2017 items
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

3,155Posts Today

5,578Users online

Martin's Twitter
  • RT @bearface83: @MartinSLewis check out the @Missguided new 60% off offer. Upping the cost of items almost double to make us think it?s a?

  • RT @efitzpat: Thank you SO SO much @MartinSLewis for your Student Loans refund advice! I just got a grand refunded right before Xmas! Whoop?

  • Have a lovely weekend folks. Don't do anything (fiscally) that I wouldn't do!

  • Follow Martin