Preparedness for when

moneyistooshorttomention

I was surprised to read there are other plants that can cause reactions besides Giant Hogweed. I'd been warned off Giant Hogweed before now and some of the recent photos of blistering some people have had from it have looked pretty nasty:eek:. I gather that it may be just some people who get so badly affected and others may not necessarily - but I'm not taking any chances.

Now common hogweed leaves are edible - and I've eaten them myself before now (fine as a spinach type substitute) BUT I don't intend doing so again - after a leading expert on this said he had been used to eating it but he has recently noticed that he and some other people have experienced reactions from doing so (though they never used to).

I think its possible that hogweed (quite possibly - both types of...) has changed its gene pool a bit (or whatever is going on technically-speaking..) and may have modified itself to be more harmful than it was iyswim. Hmm....stroking chin and wondering just how widespread the effect is of G.M. stuff blowing round the place in the wind and whether that could conceivably be anything to do with it?

*******

On the paying off the mortgage front - I've long been an advocate of doing so asap (particularly having got caught on the end of interest rates rising from Normal Level to Skyhigh Level back in the 1980s). Mine was paid off years early. Mind you - I had watched my mother do the same with her mortgage (ie she believed in paying them back as early as possible too). Of course - with my father in the Armed Forces that made sense for her to do so (though she had "belt and braces" insurance that the mortgage would have been paid up on the spot if anything had happened to either of them as well).

To me - it makes sense at a lot of levels. I always wanted to make sure employers/the DWP (if I were unemployed) had as little excuse as possible to put pressure on me (using the leverage of me having a mortgage) and that I and I alone was making my financial decisions - ie without any outside influence being capable of being exerted.

Frugalsod

Everyone seems to ignore the fact that housing is viewed by accountants as a depreciating asset. You will need to renovate regularly and that could be very costly as you have to take out those avocado coloured bathroom suites from the 70's and redo the kitchen to make it at least up to date if you are trying to appeal to higher paying tenants, or even to sell it. These could cost several thousand pounds and if you have a mortgage these could add up to several months mortgage payments when you really need that rental income to cover the mortgage payments.

I agree with you about debts but many people have debts all over the place, from credit card to store cards, even catalogue debts as well as overdrafts and loans. All of these should have priority in terms of overpayment as they are the most expensive debts. As you clear each one roll over the payments in to the next most expensive until you only have to pay the mortgage. The mortgage should be the last as it is generally the cheapest form of debt.

The problem as I see it is that many people are pretty stretched to start with. It takes time to cut expenses to build up a sufficient cashflow to overpay these debts.

First thing everyone should start with are the no cost options like changing behaviour like stop running the tap when washing your teeth or leaving lights on in empty rooms. Only buying the food you actually need and will use that week. Eliminating food waste could save you £25 a week or more. Other no cost options are changing providers of utilities like gas electricity and phone. If you are on means tested benefits you could qualify for BT Basic http://btplc.com/Inclusion/ProductsAndServices/BTBasic/index.htm which could save you £30 a quarter.

The next best option is to do things that reduce outgoings like overdraft fees whose APR can be in the thousands of %, or replace lightbulbs so that your monthly overheads fall enough to allow you to avoid needing extra finance, especially payday loans even if you literally have to just allow the repayments to run their course.

Next you should be doing things to reduce regular outgoings. So start with the things that have a higher rate of return than the interest rate on any debts. So if you had to invest in pans so you can cook from scratch more then the rate of return should be enough to pay for itself very quickly. Making those pizzas instead of buying them ready made will have huge cost savings. Insulation has a higher rate of return than most loans. Doing anything that you can that has a high rate of return will reduce regular expenditures and allow extra debt payments. Sometimes just leaving it in the current account so that you no longer get it with bank fees will pay for itself very quickly.

I have a weekly standing order to pay my credit card so I never miss a payment and because credit card debts are calculated on a daily basis it also reduces the amount of interest payable.

Then work your way through your debts in order.

Frugalsod

mardatha wrote: »

Totally agree with GQ on the property buying bit. People get so fixated on it and I never did see the point, too many potential downs as well as ups.
With one thing and another I haven't got a good feeling about the coming 5 years at all.

I agree re property. Only if you manage to pay off your mortgage in time will you reap any benefits. Though you may still have to have a significant upgrade by then as things like electrics will need replacing, boilers need replacing and insulation upgraded. All could involve significant sums of money.

With it taking years now for first time buyers to save up the deposit necessary to even get on the ladder and then they may still have significant student debts to clear first as well the dream of owning your own home will become ever more distant for more and more people.

Longer term this is disastrous for the economy. Renters simply do not buy the white goods that home owners need. They might not buy many of the goods that owners might get. This shrinks the market for so many goods and services, creating less economic activity. Worst of all a population that is socially excluded from most of the benefits of society become revolutionaries over time. Occasionally the elites pay for this arrogance with their heads, sometimes they have to flee with only the things that they can carry.

moneyistooshorttomention

There is an element of "could go either way" dependant on peoples circumstances as to which to pay off first out of debt or mortgages. I guess I tended to work on the basis that decent size chunks of money would go towards paying the mortgage off early and smaller bits (ie spare money from a months salary) would go towards paying off debts.

I think it depends a bit on what type of debts you have. I didn't have loads of storecards/etc. Mine were of the "loan taken out for urgent expensive work on house" type debts - and thus were being paid off in the course of monthly payments anyway (rather than having to make a special effort to do so iyswim). When I got fair-size chunks of money (ie a large-ish lump sum one time and payouts from building societies that they were doing a few years back) then I wanted to see something concrete for my money - hence chunks like that went straight to paying off mortgage capital.

There is an element of "horses for courses" based a bit on personal circumstances as to whether to prioritise debt or mortgage.

Re the swopping of avocado bathroom suites - then many aspects of getting a house sorted out can be lived with until there is spare money available for it and old-fashioned coloured bathroom suites is one of them. Right now - I ran out of money before being able to swop the kitchen and that has got to wait until I have the money (as, despite having been done earlier this century, its 1980s style and a bodger did it). As long as the basic structural stuff of roof/central heating/electrics/general maintenance are okay - then the rest of the money to get a house sorted out can wait.

Re housing as a "depreciating asset" - that may or may not be the case in some respects. However, owning your own home is about a lot more than that. Its about having security and stability (particularly given the state of the rental market for the last few years - with its 6 month contracts and high fees to get a place). Its knowing you've got "your home is your castle" and its up to you and only you what happens within its garden walls basically. Its a bedrock of security and confidence from which you can then work outwards and feel more able to get the rest of your life as you have decided/assumed it will be.

But...yes...I do tend to agree that "socially excluding" people from things they've been brought up expecting to have is something that could cause them to turn "revolutionary". I remarked earlier that 3 spells of unemployment in a row (and sometimes not for fair reasons either) and I still hadn't been able to buy a starter house for myself brought me feeling very close to the brink myself and I was there thinking "One more hit...just one more of this darn unemployment lark and I still haven't got my house yet....and I might turn communist yet". Fortunately that didn't happen (though gawdknows I had to fight hard sometimes to prevent it) and I did manage to buy my house - but I can well understand why people might feel that way.

Frugalsod

A mortgage should be the last debt to clear as it is the cheapest to have. Any other debt should be eliminated first as it will almost certainly be a higher APR.

After that you could ask about over paying a mortgage as it will reduce the term of your mortgage and allow you to pay it off early. It might only be allowed once a year so save up and then each year make a big one off payment.

Until you have cleared that mortgage you are only marginally better off than renters except that you are a little more in control of your outgoings. I have known people who have lost their homes because of a property collapse and negative equity. Overpaying your mortgage will allow you to clear it sooner and possibly avoid negative equity. Well renters might be at the whim of the market they can always benefit from falling rents, plus mortgages have only one way to go.

In a serious financial crisis house prices could collapse as you could find that the home plummets in value. As only cash buyers will be able to buy. In Greece 95% of home purchases are now cash only. http://www.zerohedge.com/news/2015-07-20/95-real-estate-market-greece-all-cash It will be the very bottom of the market that suffers most should this happens here.

[Deleted User]

For the first time I can remember, diesel is actually cheaper than unleaded.

Tesco is selling it at 113.9, compared to 114.9 for unleaded.

As a diesel driver :j

Frugalsod

Bedsit_Bob wrote: »

For the first time I can remember, diesel is actually cheaper than unleaded.

Tesco is selling it at 113.9, compared to 114.9 for unleaded.

As a diesel driver :j

Congratulations have you started stockpiling it?

A friend of mine with a diesel pointed out to me on Sunday that it was the same price in the local ASDA service station.

[Deleted User]

Frugalsod wrote: »

Congratulations have you started stockpiling it?

What kind of a fuel do you think I am?

Frugalsod

Bedsit_Bob wrote: »

What kind of a fuel do you think I am?

Clearly a petrol head or should that be diesel head?

maryb

LOL just before the election when Labour's manifesto had the mansion tax proposal, someone said that there would be a sudden run on avocado bathroom suites from people trying to make their homes LESS valuable