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    • VDOT47
    • By VDOT47 30th Oct 17, 1:32 PM
    • 42Posts
    • 41Thanks
    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!
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    • phillw
    • By phillw 7th Dec 17, 5:59 PM
    • 1,030 Posts
    • 614 Thanks
    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!!
    Originally posted by VDOT47
    It is a lot.

    What I found at the beginning was that the debt was so large that it was unreal and not worth worrying about. When you have 270K in debt then spending 2K on a holiday doesn't seem like much. When you get down to 2K mortgage, going on a 2K holiday will be the choice between being mortgage free or not.

    I keep a balance sheet with everything on it. Whether it's a current account, mortgage, utility accounts, contents of my wallet, euros I have left over, amazon vouchers etc etc. That way I know month on month what the position is and I don't forget to spend vouchers etc. Every month I fight to get the number lower.
    • VDOT47
    • By VDOT47 11th Dec 17, 10:39 AM
    • 42 Posts
    • 41 Thanks
    A reasonably good weekend spending wise, although the heating has been on much more than normal what with the snow and plummeting temperatures, so that will be costly in the long run but it has definitely been needed (especially as DD has a horrible cold).

    First mortgage payment at the revised amount of £1200 went out today, so that is an overpayment of approx. £31. Will make my additional monthly overpayment once payday arrives (early this month) and I do the maths to work out what we can spare this month.
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