Its time to grow up and pay off the mortgage

OS_QS

Well this is our year to start chipping away at the mortgage!!!

Got our annual mortgage statement in, and instead of filing it away, I actually read it this year.

We are due to be mortgage free in 2032 at the age of 48. This seemed very far away, so I began playing around with numbers and spreadsheets (a major weakness of mine!) According to the number crunching, with dedication, it should be possible to knock 10 years off the MF date. But imagine being MF at 35….a girl can dream!

Then reality kicks in - Unfortunately we will have some big expenses coming up this year – likely a car, a couple of close friends’ weddings, and I would like to get started organising my own wedding.

However, I thought it about time we committed, so I have set up a Standing Order for overpaying £300/month, which started in January. I had hoped it to be higher, but was being cautious.

I’ve decided we’re finally going to start overpaying our mortgage. Hopefully this diary will keep me focussed and motivated.

Thanks for reading!

ETA 2016: four years on and have done all the expensive life events and am now thoroughly grown up with our own wee monkey to look after. Still chipping away at the mortgage, and our aim is to be financially free by 35....ties in nicely with little one going to school.

OS_QS

I've been lurking on these boards for a few months and am truly inspired at the commitment and hardwork everyone puts into their goals, as well as the support offered.

I have signed up to February's Grocery Challenge in the hope that it will keep me focussed.

Obviously, I'll need to do more than the Grocery Challenge to make sure I hit my monthly overpayments so any comments / ideas will be greatly received!

thanks in advance!

originalmiscellany

Excellent work ma'am. It's incredible how as you've identified, a small difference of say even £50 a month makes a terrific difference long term. Here's to a productive 2012.

macgirl

Sounds like you've already got your head screwed on, so I reckon you will make amazing progress.
Go for it

Spiggle

Good luck with your plans, you'll be amazed at the difference such an OP each month can make. And it can become highly addictive!

All the best,
Spigs

Jock_Tight

Just grow up eh

Every overpayment no matter how small makes a big difference over the term of the mortgage especially if you have 20 years to go.

We started out with just £60 extra then started looking around for ways to increase this further. Saving on utility bills, insurance, Bank of Scotland reward accounts for the free £5's etc....its all adds up and can be put to wards the mortgage. If you set this up by DD then it focuses the mind and you get used to the money coming out so don't miss it as much. Five years later we are now up to a fixed OP of £475 per month.

All the best on your journey, have a can do attitude and you WILL succeed

Jock.

OS_QS

Thanks to all that have left messages. I talk a good talk, but can’t seem to follow through!:o

Yup, we need to grow up and move on to the next stage of life. We’re living life, with no thought to tomorrow. In a way, we are kind of burying our head in the sand.

If we don’t start saving for a car soon, (its almost 10yr old) we will be forced to get a big loan (something I don’t really want to do)

SO, I need to re-jiggle finances to get our lives in order so we can grow up and move on with life… How to do that is an entirely different matter!

I now need to get these musings into action and according to the spreadsheets, we can afford the following / month (although goodness knows what it currently gets spent on!):

300 Mortgage overpayment
300 wedding fund (aim £4K)
300 car fund (aim £8k)

However, I have no idea with how to save. I only have my current account, our billing account, and an old isa which pays 0.1% interest. I don’t know if I can move it as I’ve put money into it this financial year.
Also, my problem is if I see money in my account I easily justify things to buy. :mad: But I also worry about not having access to money should something go wrong.

Thanks again.

SomersetSaver

I'm more of a lurker on these boards (starting to think about how I put my MF wannabee plans into action) but just wanted to add my good luck wishes and to say well done so far; I wish I'd started OPing mine when I was younger as I would probably be mortgage free by now!

Just a tip which I have found has worked for me is that if you THINK you can afford those 3 x £300 overpayments then perhaps set up 3 new accounts (don't forget there are various offers for switching accounts - like the £125 for First Direct) and set up an SO/DD on payday into those. That way, the money isn't in your account to spend it. And if really necessary, you could arrange to transfer some back out if you do find you're short near the end of the month.

Finally, if you put up your SOA then I am sure people could help advise on where they think you can cut back.


There are also some good regular saver accounts so you could look into those as they are really good rates if you can commit to an amount each month. (e.g. FIrst Direct had an 8% one if you also had their current account).
Have a check of Martin's best buy guides for instant access and regular saver accounts as you should be able to get near 3% for accounts at the moment.

Second, if you're not sure what you're currently spending your money on then do a spending diary for a month. If you've a smart phone, there are loads of apps for that kind of thing. Or get a little notebook and write it down as you go along. It's really enlightening (and scary!) as to where the money goes. It's all those odd little things that seem to add up (e.g. chocolate bar here, magazine there etc)

You're doing well and don't be so hard or yourself - think the person who said grow up was being ironic by the way!

OS_QS

Thanks for the response - I will look into First Direct, and never thought of having more accounts.

Dont worry - I took Jock's comment in the light hearted manner it was meant (I'm scottish too and we are very sarcastic by nature)

I'll definately look into the apps for recording spending..........if only my OH would record his - I'm sure that make shocking reading!!

macgirl

Yes it is easy to talk a good game and I certainly wish I'd been as savvy at your age, so don't beat yourself up. You've made a plan to start now - so that's as good a start as any

As SomersetSaver says, once the savings leave your account on payday, you can enjoy watching the savings grow and the mortgage balance come down. As others have said, it *does* become addictive - so just jump right in!

SomersetSaver

OS_QS wrote: »

I'll definately look into the apps for recording spending..........if only my OH would record his - I'm sure that make shocking reading!!

There are some apps you can share, so that you can record your household spends.

I use a simple one called EEBA - which is basically envelopes of money which you fill each month and then record your spend against. I'm not very good at filling it in, mind you, but it does give a nice visual of how your spend is doing and tells you if you're ahead or behind of schedule. New Year's resolution is to fill it in properly! It's free too so very:money: There may be a sharing feature of this but since I'm the one obsessed with recording our income, I just get my OH to give me the receipts on the occasions he does the shopping!