Pavlovs_dog starting as she means to go on...

pavlovs_dog

after 6 long years living with my in laws so that we can save a deposit for a house, we will be getting the keys to our first home tomorrow.

we don't know if it is our 'forever' home but it is certainly the place where we plan to spend many years to come. We are currently a family of two but have bought a four bed so that we are 'future proof' and can grow into our new home when we decide to start our family.

we bought our house for £174k with a £44k deposit. We managed to find a very good five year fix at 4.19% with Accord which will run until june 2015. Due to having to add the mortgage fees for this product to the mortgage(i know and it pained me greatly but this is the best product for us) we have a starting mortgage balance of £131,990 payable over 25 years. Or at least that's what the bank thinks!

we really don't want to be slaves to the mortgage until we are in our 50s. We want to slay this debt so that we can have security, and the freedom to holiday as much as we want. With that in mind, here is the master plan...


September - December 2010 - paving the way

Our aims in this period are to

*try to finish furnishing PD Towers as best we can with the last bits of spare savings

* build up a slush fund in the current account to deal with the unexpected.

* fine tune budget from forecasted figures to actual incomings and outgoings and get a much better feel of how much we actually have left at the end of the month.



January 2011 - on your marks, get set, GO!

* set ambitious but achievable target with which to join MFI3

* Start overpaying the mortgage each month. I've forecasted that we should comfortably be able to OP at least £100/month.

* drip feed emergency savings/rainy day fund. We do have a safety cushion, but i'd be happier if it was bigger.



January 2014 - Steady as she goes

Hope by this point to have made sizeable progress towards having a super duper LTV ready for when we will be in a position to remortgage June 2015 onwards. i'm quietly hoping to be sub (or as near as) £100k by remortgage time.


so that's us as things stand at the mo. I've gained so much inspiration from reading the diaries on here, and I'm so excited to finally be joining the MFW ranks :j

Iris_Blue

How exciting about you getting the keys tomorrow. Bet you won't sleep tonight! It sounds like you have it all worked out Pavlos. Well done with everything


Ouch at 6 years with the in laws though :eek:

cha97michelle

I bet it will be bliss having your own space. I think no matter what space you have also, you fill it with stuff. We filled 3 rooms before the kids came along by ourselves, and have been constantly decluttering since.

Really nice to see your long term aims. No reason why you can't do it. And good idea to fix for 5 years while you get your bearings. That is what we did.

wynnvegas

Great plan PD - sounds like you've got it pretty much figures out. I really hope things progress smoothly over the next few years. Will the September - December leg of the grand scheme give you a solid estimate of a mortgage free date or is it too soon to think about that yet?

Cheers,

Billy

Secret_Saving_Squirrel

Hello and good luck to you. I wish I'd had your good sense before we had our children and couldn't afford to do anything! It would have been easy to overpay but we were ignorant and as a result we filled the pockets of the bankers over and over and over....

Well done,

Squirrel

gallygirl

pavlovs_dog wrote: »

i'm quietly hoping to be sub (or as near as) £100k by remortgage time.

Oh dear, that's how we all started, with one little target........

Good luck, how exciting for you :T

pavlovs_dog

wynnvegas wrote: »

Will the September - December leg of the grand scheme give you a solid estimate of a mortgage free date or is it too soon to think about that yet?

Hi Billy. To be honest it's hard to get a definite MF date. I'm a teacher going into my 2nd year of teaching. Inspite of the govt pay freeze my pay will increase every year as i move up a 6 point pay scale. I've just gone on to point 2 of 6, but until i get paid at the end of the month it's hard to know exactly how much more my take home pay will be. We will have this situation every September for the next 5 years! My initial forecasts suggest that clearing the £31990 in the next 5 years is ambitious but within reach so long as nothing unexpected happens. Sadly life doesn't happen like that I also suspect I'm on the wrong tax code so I need to investiagate that.


so we got the keys on Friday and have spent the past two days madly cleaning, unpacking and building flatpacks. I've managed to sort out mobile broadband to tide us over until we get our broadband installed. Only a million and one things left to do before school starts tomorrow :eek:

pavlovs_dog

well today is our one-month-in-the-new(to us)-house anniversary. Can't believe how quickly the time has flown. Although I still have a list the length of my arm of things to do to get the house how I want it, it feels really homely and it has been lovely having our own space.

Although there are still obvious furniture gaps, the house is now at a state where we can live comfortably in it. Apart from our sofas (which are paid for and on order - due end of Nov), there is nothing that we don't currently have that we cannot live without in the short - medium term. Structurally, there is nothing essential that needs to be done to the house, although I am eager to get a man out to cap our chimney pots and sort out our aerial sooner rather than later.

today has been the first opportunity that we have had to sit down and look at how our new budget is shaping up. I did not envisage having to pay quite so much in advance for quite so many bills, so that has !!!!!!ed the budget slightly until the new financial year. Thankfully we can afford the higher bills and still have a little cash floating around at the end of the month. The budget busters are:

Council tax - 5x £112 payments instead of the £81 12 monthly payments we budgeted for

Gas - monthly DD of £54 (budgeted £40) although we can reduce this after the 1st bill if it is way out. As we're heading into winter we're going to be using more than 'usual' anyway, although we've been very disciplined about putting on extra clothes, blankets and hot water bottles. Heating has only gone on twice, one of which was because we had guests!

Electricity - is a quarterly bill, i've upped my pricing in the current budget to match the gas dd. We currently have a different supplier for each. Once we have some usage figures to play around with we will compare and see if switching will save us money.

water - 6 months worth of payments at £65.12 instead of the £40 we'd budgetted for. Using data on the bill which shows charges of £454.85 for the year that should give us a monthly outgoing of approx £37.90 from next spring.

tv license - this one i knew about. Payments of £29.10 instead of the £12.12 I was using in my original budget.

As for my pay 'rise' this year, my take home pay has increased by a measley £100. I know a rise is better than a fall, but it's a bit of a kick in the teeth considering how much heavier my teaching timetable is this year. I'm trying hard to be more organised and disciplined about school work this year (with a reasonable degree of success), but I am absolutely knackered now. Only 15 more teaching days until half term!

The cumulative affect of the above is that on the current budget we have about £152 'spare' at the end of the month, and by april (ish) that should hopefully have risen to £250 ish. As the budget is one that aims to provide for every financial eventuality, that money really should be spare, so most of it will be channelled into OPing and building up our safety cushion savings further.

pavlovs_dog

Progress thus far...

pavlovs_dog wrote: »

September - December 2010 - paving the way

Our aims in this period are to

*try to finish furnishing PD Towers as best we can with the last bits of spare savings

there's nothing that we don't currently have/haven't ordered that we cannot live without, so the savings will now be left as they stand and we will not be dipping into them any more as per our original plans.

Next furniture priorities: When the sofas are here and finances allow we will get a proper coffee table and some kind of sideboard/unit for the front room.

pavlovs_dog wrote: »

* build up a slush fund in the current account to deal with the unexpected.

we thought our first proper mortgage payment was coming out on 28th September, but it is actually the 28th Oct. We are therefore leaving £500 of the £710 mortgage payment in our current account as a slush fund to deal with any unexpected bills/things that go out before other monies have had a chance to come in. As our monthly outgoings settle down further still this slush fund way well be further reduced.

pavlovs_dog wrote: »

* fine tune budget from forecasted figures to actual incomings and outgoings and get a much better feel of how much we actually have left at the end of the month.

ongoing - see previous post for more details. May well post SOA for feedback in a month or two.


Priorities for the month ahead

*get estimates for having new aerial and socket points installed.

*find out if it is possible to view mortgage balance online

*join and attempt to keep up with flylady - i've been a bit lax on the cleaning front

*choose and apply for new ISA accounts as rates on current ones are rubbish.

* set up savings account to drip feed the money for larger annual purchases (eg insurance policies)

*create standing orders to automatically pay into new savings accounts

*plan rough budget and present list for christmas.

*reduce J's mobile contract down to £10/month contract - he doesn't need any more and we get free weekend calls with our phone package

*track expenditure on food and ensure we stay within budget. we've been successfully mealplanning and shopping from the cupboards following a big shop when we first moved in so it shouldn't be too difficult

*maintain organisation level regarding school work

* make inclusive calls to avoid being charged by BT for not making enough calls :cool:


PERSONAL

- try and get into sleep routine
- drink more water


looks like another 'quiet' month in the pavlov household :eek:

originalmiscellany

I like your details PD, makes a good read.
I too work in education and like you am thinking of the 15 days till half term - boy do I feel I need it!

I have water at school in a big 2 litre shape, and drink one per day during normal teaching. I find having it on my desk means it's easy to drink and keep everything lubricated as it should be - much better than tea and coffee anway

I'll subscribe to your thread as it'll be interesting to see how you're getting on, and you have my sympathies re pay rises, you think it's gonna be a big one, but the reality is often that you get a much smaller increase once pension NI etc have come off. That said, I'm not complaining, and like you am grateful for any pay rise in a climate where cutting back is the key driver to so much.

All the best PD!

kazwookie

Have you looked at your local freecycle / freegle group for the odd bits of funriture you need, till you have the budget to buy what you want?

Good luck with it.