MF by December 2014

billywhizz88

First post having read many posts so now feel determined to commit my actions to print

I and OH paid off our mortgage in October 2010 and promptly borrowed £150k against our offset mortgage to fund a purchase of a villa in Turkey which having paid for all the buying costs and furniture leaves us with £114k to pay which we are seeking to clear in time for when our son goes to uni in Ocrober 2013

This will require us to pay approximately £3300 off our mortgage which includes a £2500 overpayment which we have consistently achieved for the past 9 months so will see us pay nearly £40k per year for the next 3 years to achieve this goal

This will leave us debt free with 2 houses paid for in full and valued at £450k by the time we are 48 which is our ultimate goal

We are determined to achieve this and are lucky as we have got good salaries and whilst we have never really lived to our incomes, have always enjoyed life within our means and our holiday home will ensure we will enjoy some quality chill time for us and soem great times four families. We need to rent it out for 6 weeks to cover our costs and flights so should be able to achieve this fairly easily and should be brilliant to allow our families to enjoy it as well as us.

The ultimate aim is to be debt free and maybe be in a position to retire by 55 meaning hopefully we will have 7 years of being able to save about £35 to 40k per year and still live fairly comfortably. This is assuming everything stays as it currently is although being Debt Free will mean we have choices that will be nice should we lose our jobs as we both work in the public sector !!!

Committing it to writing makes it seem more real, 36 months to go and I will plot our progress on here as we go

Good Luck to everyone else on their goals

black_taxi_2

a plan is 100% better than no plan

billywhizz88

A quick update

Cannot believe where the last year has gone

Well I didn't quite meet the target I set us to save £30k in the last 12 months but I didn't bargain on the wife wanting a new kitchen which cost us £11.5k but possibly a good decision as we get to enjoy it and it would only have gobe up in line with everything else

However we have reduced our mortgage from £114k to £87k so have reduced it by £27k by the regular overpayments we have been able to make

I have reset the forecast and the aim is now to be MF by February 2014

That means us making £3.7k in payments on the mortgage (which includes over normal payment plus the overpayment) so hopefully if interest rates don't increase we can be M.F. on our holiday home having achieved it on our main property. Just need to keep the wife out of the shops for another 24 months (possibly the biggest challenge !!!)

madeupname1

Hi Billywhiz - good to see goals committed to paper (or should I say to a thread) and see how they compare a year on. You might not have met you target but still excellent progress (and at least the portion by which the target was missed got spent on something useful)!

If you have set a goal for repayments, how about joining us on the 2012 MFW thread (I am always trying to persuade people to join) but it is interesting to see other peoples targets and how they are doing Beware though - its a bit addictive

madeup

Sepa74

Kitchens are important... I got mine renovated this year too, and it makes SUCH a difference to my quality of life, and is definitely worth the cost plus the interest I would have saved on the mortgage

billywhizz88

Update

£3250 OVERPAYMENT MADE IN JANUARY...GOOD START TO THE YEAR BUT FEBRUARY NOT LIKELY TO BE AS MUCH !

Would have been slightly better but I sucummed to OH pressure for a change of suite in the conservatory. Our in laws gave it to us 3 years ago and she has never really liked it eventhough it was fine by me but it is helping out our nephew and partner start their new home

So I went searching on e bay after she showed me the one she wanted at £2200. 2 days ago picked up an immaculate 2 "2 seaters" and arm chair in white leather for a bargain £200 !!!! It looks terrific and with the hire of a van and petrol all delivered for £270. I even gave into a new rug from Dunelm and scatter cushions / leather boxes from ASDA at £170...the son was happy as he got the old rug that will now be a great play mat for our grandkids. So although an unplanned outlay, see all this as an invest to save as I had agreed to the new suite when we were MF in 2014

Gas supplier changed at start of month and expecting a £300 reduction on annual spend and looking forward to my free £50 of wine and 4 glasses curteousy of going via the MSE link

So month 1 down, roll on February and warmer weather to follow

billywhizz88

Cannot believe where the last 5 months has gone since last update

Spent 5 weeks in turkey at our villa survived the 6.3 earthquake albeit had an unexpected £200 repair bill for damage but we have decided that we are now going spend no more money on it although we have a new target to now retire at 56 and 53 respectively at the end of 2018 making our need to be MFE even more important

The tumbledryer packed in but accept these things happen and got a decent replacement for under £250 all in by shopping around. Comes of limited choice as the OH insisted on graphite not white

But apart from all this we have reduced off set mortgage by just over £10,000 so under target but have save £13,250 since January in 5 months

Hopefully with no forseeable problems or costs we should get near £30,000 by the year end leaving us about £40,000 to be MFE on our second home having been MF on the main house since 2009

Master Plan

By end of year

Main House - asset of £250k conservative - own outright
Holiday villa - paid £170k - £57k to pay now hopefully £40k by year end

By Dec 2013 - two assets worth £420k - even if villa has dropped in value £380k
5 years of savings - estimated with £50K assumed costs for extras (holidays, replace car, wear and tear) at £150k

Sell main house - £400k in bank

Live in villa in Turkey

Live off interest currently 8.9% but working on 5%

Hopefully mean we can withhold drawing work pension until 65 but have option to draw from 60 if need too

Seems like a plan

billywhizz88

Update

Cant believe its 2 years since starting to commit to my diary

So where are we ? We have paid £70k off in 2 years and will go into 2013 with £45k to pay off

A few extra expenses on birthdays and one or two items for the villa which cost £3k but we are just about on target

ONE MORE YEAR AND WE ARE NEARLY THERE

Themandarin

Am considering starting my own diary and its really inspirational to read others.

Well done, you are on the home strait now!

billywhizz88

Update on my mortgage free by December 2014 ...

I think an update is due as its been 10 months since the last one

All being well I will achieve my target eventhough it has been an expensive year as its the OH 50th meaning an unplanned holiday to the Maldives this coming January at circa £9k (although it will be great), her presents coming to three times my budget at £3k and getting the house decorated at another £3k plus buying our lad his car as a well done for getting through your army training at £1,5k. Hence my view that I would have paid off the mortgage in theory taking all ISA's into consideration by December 2013 would have all but been acheived as I calculate that to be £16.5k and I will be at £21k owing at the year end

The lease car went back this week as our work scheme has finished which was costing me as I found to my surprise nearly £400 per month with contributions and tax and as our son is off to Germany I have bought back the car we got him which is a 950 lupo (a bit of a comedown from our second car the Honda CRV which my wife is having as the 5 series lease BMW has gone back. Hopefully it will keep going for a couple of winters at least with little cost and that should see us save about £4k each year.

The returning lease car gives me an unexpected additional income of £3000 per year increase in salary plus increased mileage and a better tax code which I work out will get me between £300 and £350 per month more meaning we can increase our monthly savings to £3600 even allowing for our £500 per monthly holiday budget and all other expenditure

This will mean we are in theory debt free by June 2014 and with ISA allowances between now and then mean we will be pretty much have £30k in the bank in ISA's and no debts by March 2015

The plan then is

We have two assets

Our main house (£270K) and the holiday villa (£150k) paid for in full

Save £3700 per month from 2015 onwards so £43,200 per year

By the end of 2018 we will have savings of £201k less what I estimate we will spend over and above day to day expenses

A new car at £18000
Replacement things for house £6,000
My 50th - £10,000
Other holidays (over and above £500 per month banked per month at £15000 - if we let it as we have this year this reduces this bill slightly although we are paying for improvements as we go)

I will then be nearly 53 and my OH 56 with £150k plus the proceeds of selling the house in UK at £250k

This gives us £400k to see us through to 65 or we can take pensions at 60 if we really need to which will give us at 60 about £20k per year each plus a lump sum of £100k each or if we can leave until 65 more

Living 7 - 8 months of the year in Turkey will need us to have about £14000 plus 3 months in Far East maybe £10,000 plus a month in UK - reckon that could all be done for about £30k

Interest on £400k should get us about £15k so feel confident we will have enough to live on before the need to draw on the pensions. You never know hopefully we will be made redundant in 2018 as LG budgets are really hit we would be a nice little bonus

So there it is a 5 year plan and my MFW update

Billy

billywhizz88

A quick update on where we are since my last post

The Maldives was fantastic and we have been converted meaning that this could be an expensive habit as we have booked to go back next year already. £6300 for 2 weeks but total r and r

We have also booked all our turkish flights now which will see us out of the country for

10 days in April/May
18 days in June
12 days in July
19 days in August/September plus the OH is away with her gfs for 12 days in October

so 59 days for me and 71 for OH. Luckily we have let the villa to friends for nearly 4 weeks so this will cover the flights so my budget will see us be able to save £4000 per month in 2014

Unfortunately my hope to get a couple of years relatively trouble free motoring out of our regularly serviced 4 by 4 didn't work out but thankfully every cloud has a silver lining as we bought a new car with a 20% family discount as by brother works at Nissan and with a reasonable trade in on the Honda the new car of £24k only cost us net £14k. So the plan will be to keep 3 years trade in on same discount and that will see us to retirement hopefully trouble free

So the budget is ever changing but on my forecasts we will now be mortgage free in September 2014 which takes into account ISA's currently offsetting the mortgage and mortgage free with £26k savings by March 2015

With yesterdays announcements on changes to ISA's this should help us as 40% taxpayers as we will be able to use the full allowance each year and the dream to retire at 53 for me and 56 for OH looks a distinct reality

Will need to move my thread then but as I am now in the year of becoming MF (we will only downsize from here) having bought our home and holiday home outright is a brilliant feeling

Work is challenging but the flexible working and holidays is delivering a much better work life balance meaning very much the work hard and liev when within my meanswhich I have done for the last 30 years since finishing my a levels will have all been worth it

Keep going everyone and make your dreams a reality

Billy