Onwards to freedom!

SuperSecretSquirrel

Another small PB win this month

I've paid a total of £151.34 in money transfer fees, and £6.35 in interest. Received £25.27 cashback, and 2 x £25 premium bond prizes.

2 months into a 24 month experiment I'm £82.42 down. Plenty of time to break even and then start making a profit. Nothing is guaranteed with PB's, so I could end up being down by £82.42 at the 24 month mark. There's also a vanishingly small chance of ending up around £1m better off. I guess reality will lie somewhere in between.

Interestingly, a holding of 50k is more likely to hit the £1m jackpot (1 in 28,537) than it is to win nothing (negligible). At least £500 is a virtual certainty, 96.9% chance of at least £750, 63.3% chance of at least £1,000, 7.02% chance of at least £1,500.

Average luck would see me win £1,000 over the two years (if I don't shift any money out into better options in the meantime). That's a stooze profit of £867.58. Will be fun finding out if my luck is average, below average, or above average

Interestingly (for me anyway), the chances of hitting a million being 1 in 28,537 doesn't seem all that bad. As a percentage, 0.0035% - never gonna happen. Funny how the same number, written in two different ways, give totally different gut reactions

Betterthanever

Well done on the win....I'm sure it will be an experiment worth doing! And of course, essentially "risk free" so you know you can get your money back if you need it. I'll be watching with interest!!

Lexi-lu

Hello SSS,

Congratulations on the win and wishing you lots of luck

LL

SuperSecretSquirrel

Thank you both, fingers crossed for the October draw

Nearly six months worth of detailed spending records under our belts now... Yesterday I realised a couple of cashback payments had been missed off the spending diary. Rather than lump them all into September, I've gone back and added them in the right place. I'll do a mini six month review with the corrected values soon.

Reviewed my credit club credit score history too: 891 June, 786 July, 650 August, 564 September... Down down deeper and down

In theory it shouldn't drop any further. No more borrowing or applications planned short term, and repayments slowly reducing the stooze pot... But next on the agenda is closing the mule card and some dormant current accounts, and potentially reducing the credit limit on the slow stooze card. This will reduce my available credit, but it will also result in my used credit percentage shooting up, will be interesting (to me at least) to see how this affects my score

Not much else to say, other than if we stick to the January lump sum plan we have just 3 mortgage repayments to go!

SuperSecretSquirrel

[SIZE=2][FONT=Courier New]               CURRENTVALUE       +/-MTH       +/-QTR       +/-YOY
House Value:    [COLOR=Blue]£125,000.00[/COLOR]        £0.00        £0.00        £0.00
Cash:            [COLOR=Blue]£41,352.54[/COLOR]     -£296.82   -£1,299.36   -£6,016.73
Pensions:        [COLOR=Blue]£72,450.57[/COLOR]   -£1,109.01    £2,701.48   £16,020.82
Car Value:       [COLOR=Blue]£15,145.00[/COLOR]       £95.00       £60.00    £5,795.00
S&S:             [COLOR=Blue]£22,539.52[/COLOR]      £810.38    £3,166.02   £11,378.93
Mortgage:       [COLOR=DarkRed]-£16,426.36[/COLOR]      £756.30    £2,254.03   £11,368.44
Due to HMRC:       [COLOR=DarkRed]-£432.40[/COLOR]      -£20.43      -£20.51       £46.21
Student Loan:      [COLOR=DarkRed]-£513.79[/COLOR]       £66.20      £131.60    £1,829.96
[B]Total:          £259,115.08      £301.62    £6,993.26   £40,422.63[/B][/FONT][/SIZE]

86.4% of the way to 300k net worth (2020 challenge), 13.1% mortgage ltv, £47,033.30 beyond mortgage neutral in liquid assets, 16.5% financially independent.

Barely any change to net worth this month, mostly thanks to pensions taking a hit. Oh well, can't win them all I'm not in the least bit concerned by dips in pension value, though I admit the quarterly/yearly comparison make it clear that this is a very minor blip along the way. I might be a little less sanguine if the year on year value was negative That could easily happen sometime in the future

I'm happy that everything within our sphere of control is still being handled well. No real progress this month, but through no fault of our own, so there's nothing to be done about it

SuperSecretSquirrel

Here are our household spending totals for the past six months:

[B][SIZE=2][FONT=Courier New]          BILLS     SHOPS     OTHER      TOTAL[/FONT][/SIZE][/B][SIZE=2][FONT=Courier New]
Apr     1278.73    291.91    721.37    2292.01
May     1526.24    330.91    419.88    2277.03
Jun     1518.57    304.92    397.63    2221.12
Jul     1426.33    343.04    759.65    2529.02
Aug     1167.57    329.88    333.92    1831.37
Sep     1174.28    425.27    437.43    2036.98
[B]Total   8091.72   2025.93   3069.88   13187.53[/B][/FONT][/SIZE]

The bills category is comprised of mortgage, childcare, council tax, electric, gas, water, phone, internet, home insurance, life insurance, tv license, tv subscriptions, mobile top-ups, transport including all costs related to running two cars (fuel, tax, insurance, servicing, repairs, etc). The mortgage is without doubt our largest outgoing, having halved the term we are paying £828.48 per month. £4970.88 of the £8091.72 bills total was spent on mortgage repayments, leaving £3120.84 spent on all the other bills, an average of £520.14 per month. The mortgage line will disappear soon, and our outgoings should drop quite sharply as a result

The weekly shops category includes all food purchased for preparation at home (including work lunches), basic toiletries, cleaning products, nappies, baby formula, etc. Pretty much all the things you'd have expected to buy from a supermarket around 20 years or so ago (so no clothes, toys, electronics, appliances, etc, just the basics). We tend to buy most of our meat from the local butcher, pretty much everything else comes from the likes of lidl or aldi, though we do use other shops to top-up on the handful of branded must haves. Average spend £337.66 per month. I'm sure it could be a little lower, but nappies and formula aren't particularly cheap, we eat well, and the house and ourselves are immaculately clean, I'm happy with what we're spending and what we get in return.

The everything else category covers... everything else! £3069.88, or an average of £511.65 per month. Gifts, clothes, books, toys, appliances, entertainment, takeaways, meals out, holidays, days out, furniture, gardening, health and beauty, all the stuff that's over and above scraping out an existence. This area could be cut back on quite a lot should we wish too, but we are happy with the balance we have at the moment. We and the children want for nothing, so we're happy to achieve that on what I think is a relatively small amount of spending, even though it feels quite luxurious.

My "finger in the air" annual household spending estimate (used in my financial independence calculation) was set at £28800. Six months in it seems as though we're actually spending a couple of hundred pounds a month less than this. Once OH returns to work and we start paying for more childcare I think it'll even out. I'll keep the £28800 figure for now.

Once the mortgage is gone (soon!), if all else stays the same (it won't!), and we can assume the next six months will match the last six months (they won't!), our average monthly outgoings would be £1369.44. Pretty close to OH's net monthly salary working 30hrs per week. That would leave the sum I bring in as being available to save and invest for the future. That's quite a nice way to think about things, even if it's not how we structure things in reality

SuperSecretSquirrel

Taking the past six months as an example, stripping out the soon to be settled mortgage, we're spending £1369.44 per month. If we were state pensioners right now, our state pensions would equate to £1382.77 per month. Two full state pensions alone would be enough to cover our current lifestyle. Any personal provision we had made would be an added bonus.

I doubt the state pension will be quite so generous when we reach state pension age, if we ever reach state pension age... No doubt it will be means tested too. Looking at how things stand, however, it's quite encouraging. Drawdown during early retirement could eat into the capital, and provided we lasted until state pension age before running out completely (since were talking early retirement, earning more money should be an option if this started looking likely!), things would be pretty much ok. Of course if your drawdown amount is set appropriately you shouldn't be eating into the capital in the first place, so that makes for a luxurious retirement with enough cash sloshing around to treat the children and any future grandchildren... and ourselves!

I'm honestly quite shocked that we're essentially living our lives on the budget of the poorest of OAP couples (assuming they are not repaying a mortgage or renting). It doesn't feel the least bit austere. Of course there would be no slack in the budget to deal with any large unexpected expenses, so it wouldn't be without its stresses, but even accounting for that I'm very surprised!

greent

Is that assuming, though, the new-ish higher rate of state pension @ £155-something/ week?- I thought it was the case that many existing pensioners got less than that, which would bring the joint monthly amount down by possibly £280-300ish/ mth?

SuperSecretSquirrel

Thanks greent, I just looked up state pension amount on the gov.uk site and was unaware of the huge gap between what people that start claiming this year receive compared to those already claiming. Seems a bit unfair, but I guess the tradeoff is they get a higher amount but starting at a later age, so for shorter time if life expectancy stops increasing. If that trend continues I guess I can look forward to a thousand pounds a week from my 120th birthday :rotfl:

Moneyfordreams

hope it won't be means tested, after years of paying the b00gger and saving the last thing they should do is take your entitlement off you.

Great summary