Pay off mortgage and start having fun!

newgirly

Gosh lots more replies !

Its a limited company, we are both salaried but don't take dividends and have not for a few years, so far we have been repeatedly told we can't take any wages into account unless your are in profit.

GG its seven years IO and I HOPE it will be cleared in the term - by overpayments :eek:

ourcornercottage

newgirly wrote: »

Gosh lots more replies !

Its a limited company, we are both salaried but don't take dividends and have not for a few years, so far we have been repeatedly told we can't take any wages into account unless your are in profit.

GG its seven years IO and I HOPE it will be cleared in the term - by overpayments :eek:

daft question I know but have you ran this set up past an accountant. Don't answer this question as its private but have a think, if you didn't draw salary would you be in profit if so you could pay yourself salary enough to use your personal tax allowance and can draw the rest via dividends at a lower tax rate.

newgirly

I had a post this morning from get more for less which I did not answer, it was a question about making a plan to put forwards to the mortgage company on Wednesday.

Id already looked at the figures and had a couple of options in mind, on extending two years and one extending four. It would free up £380 and £620 respectivly , however I'm guessing that even if they did allow us to alter the term, they would insist on extending the term much longer due to affordability?

newgirly

ourcornercottage wrote: »

daft question I know but have you ran this set up past an accountant. Don't answer this question as its private but have a think, if you didn't draw salary would you be in profit if so you could pay yourself salary enough to use your personal tax allowance and can draw the rest via dividends at a lower tax rate.

We would not be in profit yet unfotunatly, will get dh to double check with the accountant though, thanks.

AlexLK

newgirly wrote: »

Eek, I might just slink back to bed I think ! not sure if I'm ready to answer so many questions first thing after a great night out watching DDS followed by too much wine - paid for by grandad

First of all, the mortagage has six yrs 10months to run, its IO as I switched to that a few years ago , so I could borrow money (a loan as we could not add to the mortgage) to get the loft converted. At the time I could easily switch to repayment or extend the term.

Fast forward and we had an expensive legal fight with one of the owners of the business re selling the old factory. We ended up buying out their shares in the business (business paid). And then selling old factory to developers , with our share of the money we bought our new rented unit with an 80k loan on top.

As dh is now classed as self employed and the business shows no profit we can't remortgage, or therefore extend term, or even switch to repayment. Hence the hurry.:(

The business I have no say in, we have cut costs and have a few very large clients about to send lots of new work in too, hopefully things will pick up, we need to downsize a couple of staff ,but are unable to , two were made redundant about four years ago. But with the new changes in law and many much older staff , it means they can continue to work as long as they like , our office manager is in her seventies and has already made it clear she will not retire for many years. I just do my job on the shop floor, and have no say in the accounts, or running of the business. Its all dhs decision,which I find hard sometimes , as I often dont agree with how he does things, hence the stress at work! My marriage is more important than the business though, so I do try and keep my nose out!

I am waffling on about the business as I have to see that and our home finances are two separate issues, I have no control over it , so need to focus on home. The wages were cut this year by 5% which did not help at all.

I may start another post as this is going to be a bit war and peace !

Thank you for clarifying things.

RE. Business:
Why on earth do you have "no control" over the business when you are both Directors of your own Ltd. company? You should be working together as a business partnership and not letting that affect your marriage. If you cannot work together like this, one of you should be looking to move out of the business. There is NO WAY one Director should be making "all the decisions", unless there is only one Company Director.

This business is affecting your personal finances and life. The business (if you are both Directors) is as much yours as your husband's. Either you are not facing your responsibility or he doesn't want you to be responsible, neither option is the recipe to build a successful business, in my humble opinion.

AlexLK

newgirly wrote: »

Hi ed, we will own it outright in 7 years.

Sorry to be blunt but where is the money coming from? What is your plan and is it workable or "pie in the sky"? Be honest and ask yourself if it involves taking capital from the business, if it involves ceasing to trade or one of you finding more work?

I'd agree money saved is as good as money earnt but saving £20 here and there on food and going on cheaper holidays is not going to pay over £100,000 in under 7 years.

Of course, you do not need to answer my questions but do think about how you are going to do this.

newgirly wrote: »

Just had a chat with dh in bed , - needed a lie down after all the questions. He has basically said I do the finances , just do it! I got told off for ordering dd the birthday cake, so there is an mse'er hiding in him somewhere

You should be working together. I'll admit there's often been a power struggle in my marriage and it almost got to the point of my wife and I going our separate ways but over this year we've pulled it together again and started to work in the pursuit of common goals.

She has stopped telling me to deal with the finances and we work things through together, so there can be no resentment from either party.

newgirly wrote: »

I am still thinking about the car- Alex if you are reading this would you like to buy Eric and then sell him back in seven years ? :rotfl:

:rotfl: ... I have too many cars already but send me some details and you never know ...

newgirly wrote: »

Another dilemma that's cropped up in the most broke of times we've had, do I sell some rings.

Jewellery , I have an engagement ring that was my grandmothers , just under a carat, but no inclusions, could never afford to have it valued , probably £4k in shops maybe 1k second hand? Dh bought it for me off my Dad for £100 way back when we were youngsters, it all he could afford, dad wanted to give it to him,but he wanted to pay

Ring 2 , a triple stone eternity , perfect diamonds , new I don't know £8k ? Large diamonds ,platinum, left to me by dads sister after she died at 50. Value £2k+ at least I think.

I wear the triple one with my wedding ring as they are both platinum , but am more attached to the engagement ring. I don't actually mind about expensive rings, can do without both if I have to.

Dad would be upset if I sold either, dh would be upset if I sold the engagement ring. Mum may possibly buy the triple ring as she has expressed and interest in the past, dad would probably be OK with that.

I should add, both have been in the family on dads side for a VERY LONG time.

Opinions ?

Whether you sell or not is up to you but get them valued and properly insured.

newgirly

Hi Alex, to clarify with the business, I started work there a year and a half ago, as another member of staff was leaving. I'm not a director and at the time I was employed when dh was the manager and held about a 60% shareholding. I just work on the shop floor and am married to the boss. The company has been running 125 years and dh has only recently got all of the shares.

Its all his decision and would probably be very different if we started the business together. It still feel a very much like the co-op it once was , where all the staff had share in it.

We have never drawn out of the business since taking over, in the past dividends were paid to all shareholders when they should not have been , with £100's of thousands going to shareholders (mainly his late boss) and old debts showing on the accounts that should not have still been there. The company was bled dry and we are now paying the price writing off years of bad debt.

Anyway, things are picking up, but any money made will go to paying back the loan we took out to buy the new building and also to raise wages for staff who have had a five % paycut as well as ourselves.

I can't and wouldn't want to rely on anything but our wages to help pay the mortgage. The138k will have to be paid from wages, if I can keep spending very low we may be able to achieve it.

AlexLK

Thank you for clarifying.

The business situation sounds somewhat awkward but if you are happy with the arrangement, then it is nobody's place to judge. Do think about whether or not you could make more money working outside the business though, especially if you have a profession more suited to your qualifications / prior experience.

If you have done the figures and you can pay off the mortgage from your wages (only you know this), then things are OK and all you need do is stick to the budget you set (may be easier said than done, though). However, if this cannot be done, would you be able to sell up and buy a house outright with the money you currently have in the house? If the answer is "yes", is it worth considering buying a smaller house outright and saving for a bigger house over the coming years? This would save you the money you are paying on the mortgage and the stress of NEEDING to come up with almost £140,000 in 7 years or circa £1,700 every month.

newgirly

Alex I have no qualifications except a few GCSEs, and have been a sahm since having dd at 22, so not so easy to earn more money. We can't downsize but could move to a cheaper area,we currently have a three bed terrace with a small garden on a main rd with an extra bed and bathroom in the loft. But we are in a lovely town with outstanding schools and are on a mainline 20mins from fenchurch street. Moving area would be a lost resort and out of total desperation.

The business situation is awkward, but I think dh does not really feel the company Is his yet, lots of the staff have been there longer than him and he has been there 27 years :eek: its a gradual mindset which is slowly changing !

newgirly

A possible minor victory - dh has offered to sell his beloved TV amp and speaker thingy (not sure what it does!) Worth a few hundred second hand possibly :j its not the money I'm pleased about ,its the fact he has taken onboard our situation and is trying to help. 30p on one poll surveys

Dd is still on her way back from London after her last show tonight, I am soooo tired.