Lois_E begins a long MFW journey

edited 24 May 2011 at 9:03PM in Mortgage-Free Wannabe
1.5K replies 90.3K views
Lois_ELois_E Forumite
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edited 24 May 2011 at 9:03PM in Mortgage-Free Wannabe
Hello everyone.

I've been lurking on here a little while and decided now was the time to join. You all seem so encouraging.

I'm not sure how much of a challenge to set myself, so I'm going to begin with a mini challenge: keep a spending diary for the whole of May. I'll set a proper mortgage OP challenge after that, when I've got a clearer idea of how my finances are going to work out now I've moved house.

So, what's to know about me and my mortgage dreams? Well, I'm in my early 40s, lone parent, living in my forever house. I've got quite a lot of equity, and the rest of my house purchase was funded by a mortgage and a couple of interest-free loans. I'll sort out some actual figures when I set my OP challenge when I've got all my building work sorted out and paid for.

I'm supposed to have 23.5 years left on my mortgage term (with the loans to be paid off as and when I can), but I'd like to do it faster than that. I don't have a specific date in mind. It isn't really that I'm looking forward to the day when I can be MF. I just want to minimise how much interest I pay over the life of the mortgage, and obviously that means paying it off sooner rather than later.
Starting again 13/4/19
Home loan 1: £21,102.50 Home loan 2: £7,698.99
Total owed: £28,801.49
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Replies

  • SJ1SJ1 Forumite
    270 Posts
    Hello!

    Welcome first of all. I haven't started a diary yet, still trying to pay off a few other things before I start in earnest.

    Spending diary is a great idea, I was shocked by how much we spent on some things. You might also consider an Statement of Affairs which would summarise everything that goes in and out? Up to you, some people like them, others are happy that theirs are on track already. I did a spending diary and have sinced moved on now to have a budget per week, I find most of my spends are weekly. I really like this although I have to admit I was generous with the amounts that I allow myself as I tend to get rather disheartened if I don't manage to stay on track (but that is another trick of this -- knowing yourself).

    If you are keeping a spending diary I would recommend two things, categorise your spends into categories that work for you. Mine are food, petrol, cash, eating out and other. These are probably different per person but these are my main spends, some are monthly like eating out, others are weekly like food. I tend to use my card for petrol and the weekly shop and bits like kids trainers and then I move to cash so would also recommend keeping a note of where your cash goes. This was a huge area for me as I would get out £50 and at the end of the week it was gone with little to show. It also highlighted to me how much I spend on food, I am a bit of a foodie!

    Good luck on the journey, I will keep track!

    SJ
  • Lois_ELois_E Forumite
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    Thanks SJ

    I did a spending diary for several months a couple of years ago when money was very tight, so I've still got the spreadsheet I used for that, and all I need to do now is dust it off and see if the categories need adjusting for this year. I have spends that are weekly (eg food), monthly (eg bills), half termly (after school club), annual (MOT, Christmas etc), and "other" (kids' shoes etc). This budgeting business is very complicated. You're so right about keeping a record of where the cash goes. I ended up doing that last time so I'll definitely do it again. Fortunately my phone has a thing for taking notes, so I'll have somewhere to record stuff that doesn't have a receipt.

    Last time I got serious about budgeting I ended up having a weekly budget for food, and a monthly budget for most of the other regular stuff. When my salary came in, I left 4 (or 5 depending on the month) weeks' worth of the weekly budget plus the monthly budget in my current account. Then the rest of the salary went into a different account, and I paid all the annual and random stuff from there. It evened out the differences from month to month. I'll do that again once I get started.
    Starting again 13/4/19
    Home loan 1: £21,102.50 Home loan 2: £7,698.99
    Total owed: £28,801.49
  • Hello :hello:,

    Just dropping by to subscribe. I find that if I've got cash in my purse I'm much more parsimonious about spending it as the decreasing amount left in my purse is so much more obvious. Saying that, I don't like carrying a lot of cash so I will withdraw £50 at a time and use it in the local shops for bread,meat, fruit etc. With cards, I find that the 'virtual' nature of them makes me a bit less aware of what I'm spending.

    Here's to the start of your MFW adventure :D
  • Lois_ELois_E Forumite
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    Hi AuntieMabel and thanks for subscribing.

    I'm not good at using local shops. The "working lone parent" lifestyle leaves me very short of time, so it's better for me to get most my shopping delivered. Also, my everyday life doesn't take me near any cashpoints very often, so I try to put things on my card as much as possible. I even feel pleased if my son asks me to buy something for him off ebay - I pay by paypal and he pays me back in cash, and then I know it will be a little longer before I have to make time to go to a cashpoint!!

    I know I can't overspend with my credit card because that direct debit is going to pay it all off at the end of the month, so it mustn't be more than there's going to be in my current account on the day! One of the things I'm going to try to do better is to keep swapping stuff between my current and savings accounts to maximise how much interest I can get to take maximum advantage of the interest free time on the credit card.

    But I do know what you mean about needing to do things to keep aware of what money's being spent. For me, it's typing everything into the spending diary that does it. In fact, just knowing I'm going to have to type it in has a very restraining effect.
    Starting again 13/4/19
    Home loan 1: £21,102.50 Home loan 2: £7,698.99
    Total owed: £28,801.49
  • This is what's so good about the forum, you can dip in and out of others spending habits until you find what works best for you. I'm at local shops everyday when i walk my boys to school and I only buy what I need cos I've got to carry it, and I'm not tempted to buy extras cos there's nothing extra in there!
  • Hello Lois_E welcome, when I read your diary I instantly thought of Pammyj she's also a working lone parent, might be a good one to have a look at.

    So lovely to see some new diaries, the old ones are great as well of course:D

    Good luck
    OPs so far £42,139
    Original end date Nov 2037 (53) Current end date June 2024 (40) Aiming for 5 years to be Mf
    DD1 Oct 2008:), DD2 Jul 2010:), DD3 Aug 2013:)
    When life is getting me down I try to remember to thank God for the blessings
  • Lois_ELois_E Forumite
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    Thanks sarahevie, I've taken your advice and had a read of Pammy's diary, and I'll certainly be following how things go for her (and lots of the rest of you too).

    I've copied my old spending diary spreadsheet from a couple of years ago, deleted the contents, and changed one or two of the categories to make it up to date. It's all my income and expenditure on it, with bar charts so I can compare incomings with outgoings, and compare from month to month. I've put in the regular monthly stuff already - my income's all predictable and then things like council tax and TV licence DDs (Self confessed Excel geek here! :o)

    Now just waiting for May to start so I can start using it for real.
    Starting again 13/4/19
    Home loan 1: £21,102.50 Home loan 2: £7,698.99
    Total owed: £28,801.49
  • Good luck Lois - I'll be following your diary with interest.
  • edited 30 April 2011 at 8:15PM
    Lois_ELois_E Forumite
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    edited 30 April 2011 at 8:15PM
    Thanks the_alchemist. I'll be following yours with interest too. :)

    ETA Ooh I've just noticed I've qualified for a star and am officially a money saving convert now! :)
    Starting again 13/4/19
    Home loan 1: £21,102.50 Home loan 2: £7,698.99
    Total owed: £28,801.49
  • Lois_ELois_E Forumite
    2.2K Posts
    Ninth Anniversary Combo Breaker
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    Woohoo! First day of my shiny new spending diary spreadsheet. I'll be filling the car with petrol and taking the kids swimming, but not doing anything else that costs money, if the day goes according to plan.
    Starting again 13/4/19
    Home loan 1: £21,102.50 Home loan 2: £7,698.99
    Total owed: £28,801.49
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