The Matrix - Re-Evolution!!

Memory_Girl

tellmeitsfriday wrote: »

A £25000 buffer fund...!!!! You're kidding!

Sorry, but that is the most ridiculous thing I've read all day!

Back in your box TMIF!

..................... but what if you could?????????:D

Scary innit???? .................. but what if you could????

MG

tellmeitsfriday

IF I could, it would be lovely of course.

However, I still don't think I'd prioritise building up masses of savings (paying pitiful interest) instead of overpaying the mortgage (at a much higher rate, and in turn whacking years of the term!)

Firewalker

tellmeitsfriday wrote: »

A £25000 buffer fund...!!!! You're kidding!

Sorry, but that is the most ridiculous thing I've read all day!

Back in your box TMIF!

Why is it ridiculous? You think it is not possible? We think many things are impossible and then they turn out to be achievable. I never thought that we could reduce our negative wealth by about £48,000 in eighteen months (without selling the house or myself repeatedly) but it was done.

Or you think that you don't need it? You do - this is years very consertvative minimum expenses for most people on here (negative wealth or not).

FW

Firewalker

Memory_Girl wrote: »

I did FW net worth calculation early this morning - how come if my net worth is over 40K I am counting pennies for car repairs???? S'funny ole world.

Calculation:

20K - difference between what I bought house at and value (conservative but I did by a repossession)

£14K - -deposit on house

£7K forgotten pension


S I get what FW says about asset rich and money poor.

MG

Thank you! Our situation is even more ridiculous than that. But - knowing your net worth is very good for morale and for planning what to do and how to change the situation.

FW

starnac

Firewalker wrote: »

Mortgages! Someone (a financial advisor) recetly mentioned to me that he meets many people with mortgages that are paid off and not much to live on.

Firewalker

have i mis read this firewalker?

their mortgage is paid off but they don't have much money to live on??? or do you mean they don't have much to live on while they pay off their mortgage??

speaking for me personally. I would be quite a few hundred pounds better off a month should my mortgage be paid off

starnac

Memory_Girl wrote: »

I did FW net worth calculation early this morning - how come if my net worth is over 40K I am counting pennies for car repairs???? S'funny ole world.

MG

This made me smile. DH and I are in a similar position. Glad we're not the only ones

Firewalker

tellmeitsfriday wrote: »

IF I could, it would be lovely of course.

However, I still don't think I'd prioritise building up masses of savings (paying pitiful interest) instead of overpaying the mortgage (at a much higher rate, and in turn whacking years of the term!)

The £25,000 I mentioned is not for interest - investments are separate andf they should be done differently. This is to have what to live on if the !!!! really hits the fan. And gives incredible security. Focusing too much on the interest that one is paying or earning is a distraction, I have come to believe.

Each to their own, is what I say. I just think that having over 50% of our personal wealth (on average) tied up in non-income generating real estate (in our houses) can't be right - this is what makes us immobile and inflexible. And, oh yes, another 40% is in the pensions that won't be enough for a hot dog dinner by the time we retire.

There should be another way;).

FW

Firewalker

starnac wrote: »

have i mis read this firewalker?

their mortgage is paid off but they don't have much money to live on??? or do you mean they don't have much to live on while they pay off their mortgage??

speaking for me personally. I would be quite a few hundred pounds better off a month should my mortgage be paid off

No, you are not misreading. There are people who have paid their mortgages and don't have what to live on. You are better off only if you continue having your current income - or higher. What happens if and when things change?

We don't know what the future holds for us - we may be able to pay the mortgage in one big and swift move or not. We may have jobs that pay twice as much but we may lose the ones we have. The only way to offset these kinds of risks is to have very serious 'reservoirs'. This should be done after negative wealth is paid off (this is bad and should take priority).

FW

tellmeitsfriday

I don't think it's sensible to have masses of savings when in debt (and let's be honest, a mortgage is a debt, and they charge you handsomely for the priviledge!)

(It's exactly the same principle as owing money on a credit card and making an effort to build up savings. Pay off the debt and then save).

Have a little bit of cash set aside if you like to mend a tap, or fix the car - but personally, I don't see that masses of savings is the most sensible stewardship of resources...

Anyway, most mortgage products allow you to draw down any overpayment if you need it - so again, IMHO it is better to get it off the mortgage and take it back if you REALLY need it

Off soapbox.

Out of interest, I don't even earn £25k a year, so it's going to take some doing to stash away that amount

Dorastar

Well anyway it appears I can make overpayments of up to 10% (gets head out of sand and looks very:o and hopes no-one notices!)

Might be able to put a few quid in as dh is working mega overtime with training at the moment - so in answer to the other question, how would I raise an extra £300=make dh work 3 weeks hours in the space of 2 actual weeks:rotfl:

Have also dealt firmly with dh's credit card debt - he got a snotty letter in post today - so I have paid off his £1.61 outstanding balance before they come and take goods to the value of!!!