Onwards to freedom!

edinburgher

We'd be in a slightly better position had Mr Market played along, but I'll happily remind myself that cheaper shares means my fixed monthly investment amount will buy slightly bigger slices of businesses this month

Amen, I was reading yesterday that the DJ has abandoned all 2015 gains :eek:

SuperSecretSquirrel

edinburgher wrote: »

Amen, I was reading yesterday that the DJ has abandoned all 2015 gains :eek:

'Tis the nature of the beast I suppose... It makes hitting targets a bit of a lottery though, with cash savings you are pretty much in total control, not so with S&S. Still, it makes life interesting

bexster1975 wrote: »

Hi SSS

I confess to having read along with your diary for some considerable amount of time. This was mainly because our mortgage neutral target was similar ( I am currently £5000 off neutral). At several years younger than me I wanted to say that your dedication to the cause is inspirational. I am not so eager to have net assets of 25 times annual expenditure, however I am keen to do my own thing work wise so that I can have more time rather than more money.

I wondered if you found that people in real life don't really understand what you are trying to do - or even if you discuss it in real life?

congratulations on mortgage neutral, I will continue to lurk with interest

Bexster

Thanks for posting Bexster! I'm not on here often enough for this to be a very chatty diary so it's nice when someone new steps out of the shadows and says hello!

Congratulations on being so close to neutral I've looked but not found a diary by you, do you have one?

Honestly, I don't really talk about any of this stuff with anyone other than OH in real life - this place is a godsend in that respect! I guess they'll find out when I hand in my notice at work some day :cool:

velocity_girl

Hi SuperSecretSquirrel, you are doing so well and honestly sound so clued up and on track, I am so impressed! Wish I had your organisation and discipline.

SuperSecretSquirrel

Thanks velocity_girl I wish I was going on your holidays! No foreign holidays until LO is a bit older sadly... Holidays are too much like hard work with a tiny child in tow!

As for being clued up, sometimes I feel like I'm bluffing my way through I can't resist a bit of research into things I find interesting though, so bound to pick up a little knowledge along the way. We all know what they say about a little knowledge though don't we :rotfl:

SuperSecretSquirrel

Cashback and rewards have been quite lucrative these past few days

Our freesat box died last week. Instead of replacing it we decided to look into the current sky offers. All new free equipment fitted, and the basic package for 12 months, total cost £250. Less £100 tesco voucher, £120 quidco, and £7.50 S123 direct debit cashback, total real cost £22.50 At the end of the 12 month period we can cancel the subscription, keep all the equipment, and go back to just freesat channels at no cost. We essentially got ourselves a new freesat box and dish for the princely sum of £22.50, and access to some premium channels for 12 months thrown in for free

I've been earning cashback on my online purchases for many years, but just recently discovered in store cashback via smartphone apps like shopitize and checkoutsmart. Picked up £10.43 worth of shopping last night, after cashback I'll have only paid £3.96! :eek: There's a nice mix of money off staples like bread and milk that most people would buy weekly, money off branded items that result in the price dropping below that of unbranded equivalents, and free samples of new product lines. There's also some stuff that is not very good value and should be avoided. The key is to just buy the things you'd buy anyway, don't get sucked in to buying just because something is on offer. As an added bonus doing a quick cashback shop is a great opportunity to pick up some freezable yellow sticker items!

Our home insurance is due in a few days. We were sent a very reasonable renewal price of £106 from our current insurer, but decided to shop around a little regardless. Got a quote of £110 for a higher level of cover from an insurer offering a £80 M&S voucher as a sweetener! That's just £30 to insure home and contents for a year. The voucher is as good as cash to us as we easily spend that much at M&S in a year

Hopefully these tips will be of use to some of you reading along These little savings along the way can add up to years off your mortgage or working life, especially if you keep them up as good habits!

:money:

SuperSecretSquirrel

It's quarterly update time!

It hasn't been the best quarter for the pensions They are quite well fed, but aren't fattening up. My S&S ISA fared a little better, but has also taken a hit due to the current market turmoil. I'll remind myself that market dips are going to happen from time to time, this is what we signed up for and it's nothing to be concerned about.

Here's a full breakdown of the situation as of 1st July 2015:

House Value - £125,000.00
Cash - £46,106.63
Pensions - £36,786.72
Car Value - £11,600.00
S&S - £4,547.71
Mortgage - £41,704.70
Due to HMRC - £1,957.25
Student Loan - £3,552.45
Total - £176,826.66

That puts us at 58.9% of the 300k by 2020 target, and £6,992.39 ahead of mortgage neutral in liquid assets. We're still heading in the right direction at least

SuperSecretSquirrel

I've been a good little moneysaver this week. I've kept up with the cashback apps (and yellow sticker freezer goodies), and have joined a mystery shopping panel. Carried out my first assignment which was fun and netted me £2.75 plus a £7.99 item I needed to buy anyway Looking forward to a few cheap/free meals out with OH courtesy of future mystery shops

I've also filed my tax return for 14/15 - over 6 months earlier than necessary! This means my owed to hmrc figure for 14/15 is totally accurate now. I'm slightly over estimating 15/16 as 40% of profit (to cover tax, ni, sl) but earnings are so low that this fudge will be barely noticeable when replaced with accurate figures this time next year.

I'm due to pay hmrc nearly £1400 payment on account this month, which leaves me with nothing from 14/15 left to pay in January Once that's done, I'll owe just £500 or so from this year's earnings, obviously (hopefully!) this will go up as I earn a little more throughout the rest of the year.

I've added a net worth chart to my spreadsheet that shows various balances over time. The general rule is to aim for all lines moving upwards, so savings etc should increase, and debts should converge towards zero. Seeing mortgage, hmrc, and slc below zero reminds me they are all debts to be repaid, and similar to how I enjoy making mortage OP's to pay the debt down quicker I'm almost looking forward to paying my taxes! I'll hold off until the very last minute to pay the taxes though, unlike the mortgage it's better to keep cash earmarked for tax payments in interest paying savings accounts for as long as possible!

Finally, in mortgage news, today's payment has dropped our balance to £40,930.45 (another square coloured in on the house - yes even though we're mortgage neutral I still colour it in when 1k is officially paid off), and the daily interest is now below £6 at £5.93

Firegirl

Your doing great!!!! Well done for all your efforts!!!

lavinia21

every time I log which recently hasn't been a lot I am amazed at how much you have achieved keep up the excellent work

SuperSecretSquirrel

Thanks Firegirl and Lavinia

My HMRC payment on account for July was reduced at the last minute, so that leaves an unexpected chunk of change sitting in my 123 account until the end of January. I was slightly disappointed at first as I was looking forward to that "debt" being very near zero, but I soon snapped out of it, I'll earn about £15 net interest on what has been deferred, and every little helps

I've seen some great threads on DFW recently along the lines of "what is the minimum monthly income you can get by on" and "how long would you last if you lost your job tomorrow". Since I'm not a DFW it didn't feel right posting in those threads, but it did get me thinking...

I've drawn up an emergency household expenses budget to illustrate what we could scrape by on should I find myself out of work. This is a "keeping our heads above water" kind of budget. No holidays, no social life, no jisa, no retirement savings, and minimal giving, it's about keeping a roof over our heads and keeping us clothed and fed. In an absolutely dire situation we could go even further and forgo the car completely (would need to budget approximately £80pm for public transport instead), and cancel our internet, mobile, and tv services, but I doubt it would ever need to come to that.

• mortgage £270pm (revert to original term and no more overpayments)
• groceries £250pm (food, cleaning products, toiletries)
• car £125pm (one car for essential travel only - £50 petrol, £50 repair/replace fund, £15 insurance, £10 tax)
• council tax £91pm
• water £44pm (current cost, could likely be reduced)
• gas £44pm (current cost, could likely be reduced)
• electric £40pm (current cost, could likely be reduced)
• clothes £25pm (growing child, adults just replacing the essentials when worn out)
• gifts £20pm (our child mostly, all other giving reduced or stopped)
• household repair/replace £20 (put money aside to cover emergencies - fridge, freezer, oven, boiler, etc)
• internet £16pm
• mobile £15pm (2x£5 payg, plus £5 put aside to replace phones as needed)
• life assurance £12pm
• tv license £12pm
• home insurance £3pm (after assumed cashback)

TOTAL £987pm

It wouldn't be a particularly nice life, but we're talking emergency budget not ideal budget. It seems we could scrape by on OH's reduced hours income alone. That was something of a surprise! If we were willing to go from living to existing I could become a gentleman of leisure immediately! I somehow doubt OH would be too pleased with that arrangement :rotfl:

If we were both out of work and nothing at all was coming in, we could sell the remaining car, and drop the internet, mobile and tv services. Since there would be no commuting, the public transport budget could be slashed to around £20pm. That would see us with a minimum monthly outgoings value of £839, or less if we could reduce our water/gas/electric bills. With nothing coming in, and having to give up on the FI dream by spending down our liquid savings and investments and the proceeds from selling both cars, we would survive for nearly six years (I conveniently assume we'd manage to keep up with our personal level of inflation).

Of course we hope to never have to put the emergency budget to the test, and so long as the money keeps coming in, we never will. But it feels good to have gone through the exercise and discovered that even the worst case scenario regards employment is not really all that bad.

Just to throw a spanner in the works regards the FI/ERE idea, we have recently been discussing the possibility of moving house at some point in the next few years. There's no pressing need, but the perfect house in the perfect area is within our reach right now, and we can't be sure that will always be the case. It'll be an interesting exercise to run through the worst case scenario with a much bigger mortgage and far less savings and see what the outcome would be. Something tells me it will put the brakes on a move any time soon as we have near complete security in our current home, and I very much doubt that would be the case should we "upgrade".

A big part of me is hoping that we can stick to the plan as it stands at least until this mortgage is wiped out. Then I'd hope to avoid the dreaded lifestyle inflation and keep on saving until we reach the point where the dream house could be bought with the proceeds of the sale of the current house plus our savings, no mortgage. The freedom fund 2020 aim could actually make this a reality, but of course if we were to pile all our money into bricks and mortar we'd be no closer to freedom... Oh well, you can't have it all!

It seems we don't really know what we want right now. Well, we do, but sadly we don't have unlimited funds so what we'll end up with will have to be a compromise one way or another! :rotfl: