Changes in life- Changes in overpaying

ironman1

I've mentioned this on other posts but could do with some advice from people.

Me and my GF recently found out she was pregnant. It was sort of planned, but really we would have liked to have waited a couple of years. But after alot of thought we both decided we were happy and excited about it.

On another topic outside of MFW I have got alot of helpful advice but thought I'd post on here as I'm sure there will be a couple of people in the same boat.

Me and oh have lived together for two years with a shared ownership. We have overpaid £6000 odd since July last year mainly thanks to help and advice on this site. We are early 20's so still enjoy the odd night out with friends and a drink, restaurant that sort of thing. We don't earn loads but still manage to overpay around 4-500pm.

What with the oh needing time off work next year do you suggest overpaying when possible or concentrating on saving money for when the baby is here? We have around £7,500 saved which was going to go towards our wedding but that will have to take a back seat now obviously.

I just want advice really, I don't want to stop overpaying but know how expensive it could be with one wage (plus maternity pay) and a baby to look after! How is it done? We can survive on my wage alone but won't have much leftover. Thanks for reading, always get helpful advice on here...

LilacPixie

I am expecting our third and OP'ing is still on the cards, Its a question of priorities and not going OTT, babies actually don't NEED much and what they do need can be bought for a very reasonable price. Often things like bouncer seats and moses baskets only last a few months and some babies don't actually like them so often someone you know or work with will have one to give/lend you.

You need to sit and work out if your one wage can cover all the bills. Child benefit will cover the cost of nappies and you will get a mountain of clothes as gifts. If your OH chooses to breast feed/suceeds in breast feeding then costs will be further reduced, if not a tub of formula is just under £8 and when my youngest was feeding the most it lasted about 6 days. If you can cope on your wage it would leave her maternity pay free to overpay and leave your savings in tact.

Factor in the cost of maternity clothes, they cost a fortune especially if your OH needs smart office type wear.

wynnvegas

Congratulations Ironman,

I'd think a halfway house between overpaying a slightly lesser amount and ensuring that the new baby has not only what s/he needs but a good few treats as well would probably be the best option. You'll get loads of stuff from friends and family no doubt and, as much as some of the stuff is incredibly cute, having a Dior and Armani clad baby is probably not a necessity!! Paying off £6,000 in a year is incredible for a couple at 23 - we didn't manage any substantial overpayments until we were about 25. Keep up the good work.

Cheers,

Billy

ironman1

Thanks all, and Billy that comment will make me feel less 'guilty' when we can't overpay as much next year!

Before I found this site I had no intention of overpaying the mortgage. We are both hardly on mega wages and living in London it can be tough, like anywhere obviously but i'm just saying! We actually got talked into 35yrs and that's on a shared ownership so you can see what we thought about getting it out the way early at the time!

I think overpaying will help when the baby arrives as we are now used to not having alot of spare cash as the majority goes in savings or towards the mortgage!

Obviously my main concern is paying the bills when my oh is off work and making sure they are well looked after. I struggle to see how we will overpay for at least a year but it doesn't feel too bad considering what we have op'd so far. I'll continue to look on here for tips!

wynnvegas

Hi Ironman,

I'd advise keeping the overpaying up - even if it's only a small token amount every month, it will hopefully keep your diary current (and the supportive comments coming in) and the motivation up for when there's more money to fling at it. When is the baby due?

Cheers,

Billy

ironman1

Cheers Billy I think thats good advice. If we have spare money I think we should overpay when possible as you say. Haven't missed a month since we started... So far!

Found out my GF will get three months full Maternity pay off her work then half for another three months. That is more than we expected so I'm happy with that.

I want her to have the year off so the remaining six months she will hopefully get the Statutory pay unless they change that!

I feel more confident in coping than I probably would have a year ago, alot of that is to do with this site

LilacPixie

SMP is only for 39 weeks from birth of baby so you will get 3 months full pay then 6 months half then she will get nowt for hte remaining 13 weeks.

ironman1

Oh thats not too sad, I thought the SMP was only for those who didn't get paid maternity from their employers anyway.

I think six months of any pay is more than enough and can't be easy or nice for the people paying it (it's only a small family firm).

EDIT- I was originally meant to write that she gets three months full pay and THREE months half, not six months as I first typed.

Courgette

Hi Ironman

Just wanted to chip in re the cost of maternity clothes. Yes, they can be expensive so it pays to go to NCT sales (find your local via website) also charity shops although not a lot of maternity clothes seem to turn up in charity shops for some reason.

It's tempting to buy lots of clothes but you don't need to. Cardigans don't need to be bought at all, just wear non-pregger ones open. I have a pair of mat jeans, black trousers for work and a dress which isn't actually a mat dress just loose and 3 smart t-shirts. Now I'm completely massive the dress is a top . Accessorise with lots of different jewellery if that's your (her) thing so you don't feel like you're wearing the same thing all the time. If she needs to buy new shoes at any point in the next few months, think about being able to get them on and off without help, ie slip ons.

Re the OPs. I think psychologically it's always good to OP even if it's just a tenner pm but like you, I'm unsure how hings will pan out once my mat pay fully kicks in. I'm putting quite a lot away as savings so I can draw on them if needed or can OP as a lump sum later on. Yes, I would reduce the mortgage quicker by paying them straight off the mortgage but I don't want to leave us short.

Some mortgage providers allow you to underpay by what you've OPed - you could find out if ours does this or anything similar.

Good luck!

ironman1

We are with Halifax who don't seem to be very flexible. You can't withdraw overpayments like you can with others and all OP's have to be over the phone or in the bank. It's strange that you can't do it online because moving money from account to account is easily doe, but not with the mortgage...hmmm!

Thanks for the advice on the maternity clothes, I will let my oh know.

uzubairu

ironman1 wrote: »

We are with Halifax who don't seem to be very flexible. You can't withdraw overpayments like you can with others and all OP's have to be over the phone or in the bank. It's strange that you can't do it online because moving money from account to account is easily doe, but not with the mortgage...hmmm!

Why no save the overpayments in a separate account (eg Regular Savers)

After re-mortgaging we've gone from having a mortgage with lots of flexible options (eg borrow-back, payment holidays etc) to one with a better rate and no limit on overpayments, but no access to the overpayments once they have been made.

We've recently opened several savings accounts specifically for saving our mortgage overpayments.

The only difference now (which does niggle a little) is that we can't see the mortgage balance online (got to make a phone call), and every time we make an overpayment, it doesn't physically show the next day in the mortgage balance like previously.

Good luck with the pregnancy.