Getting my head around a major change of plans.......

Busymumofthreeplusdog

I've been skulking about for sometime now and finally decided to come out into the open.

The background

I don't do change very well!

DH is about to retire in April and gets a significant lump sum. The plan was always to pay off the mortgage( or most of it anyway) and be MF. However we had a meeting with an independent financial adviser(who also happens to be a family friend so trust him explicitly!) who has strongly advised that we invest the money and change our mortgage. We have one of those Australian type mortgages that basically means your current account is always in negative. (That was a big thing to get my head around in the first place). Mortgage rate is currently 3.75% and advisor reckons he can get us a 2% rate fixed.

We started off with around £80,000 but gradually added to it as our family grew and we fixed up and extended our house (being an old listed wreck). Current total hovers around £142,000, depending on how near to pay day it is. I'm kinda annoyed with ourselves for letting it get grow:mad:. Last time the house was valued I think we were quoted £250,000. So there is reasonable equity.

A colleague of DH was also given the same advice so I'm guessing investing the capital is a reasonable thing to do.

Although DH will get a decent pension and is intending to get another job to make up the shortfall:T. I guess I'm just having a mild panic.

I feel that over the past few years we have consistently spent more than we have earned. Certainly this last year or two I've been more mse and started changing suppliers etc but still we seem to leak money.

DH is not at all worried (but he's never been great with money). I'm trying to get through to him that he has to cut back but my pleas are falling mostly on deaf ears. He doesn't do 'self denial', if he wants or needs something he usually just goes ahead Nd gets it.

I really shouldn't complain it's not as though he wants to blow the money on a fancy car( actually I think he would like to do that but he is part way sensible). We both have good jobs with decent pensions - the joys of working for NHS & local government.

Anyway the bottom line is I now have to start looking at mortgages but it needs to be paid off in 15 years when I would like to retire.

I definitely want a mortgage that will let me make overpayments and get rid of it sooner. So I would be grateful for support from anyone as I get my head round this big change of plan!:rotfl:

Cheers
Busy......

Busymumofthreeplusdog

I've spent most of today reading thread after thread! What an inspirational lot you are:T:T:T

So I'm going to start putting the ideas into practise. Budget thingy done. Couldn't believe how much we spend at the supermarkets and that doesn't include meat & eggs as I get those from local farmers!

Thinking the food bill is definitely the first one to attack. Meal planner completed for the week. Will still buy meat and eggs locally, but use less meat in cooking. gonna try slipping in some lentils to bulk out meals, more veggie dishes will be on the menu. That will suit DD, she doesn't eat meat but DS2 doesnt eat veg( least not much!), luckily DS2 eats anything, as does DH!

Anyhow it's high time I put the light out as it's my turn for the 6.15am dog walk, lucky me!

Cheersmydears!
Busy......

arbroath_lass

For my own peace of mind I'd pay off the mortgage. And get rid of the potential to borrow more on it.

Alchemilla

Welcome! I have some sympathy with ALs view.when there is debt there is always some risk, especially if your DH is not on board yet?

jackieblack

arbroath_lass wrote: »

For my own peace of mind I'd pay off the mortgage. And get rid of the potential to borrow more on it.

I agree with both of the above.

RainbowBridgeReturns

Hi there busymumofthreeplusdog, it looks like you are about to get even busier.

It is amazing how much can be saved on the weekly shop, without cutting down on the quality of food eaten.

All the best on your journey. I will subscribe and cheer you on your way too.

stedwell

Hi there. :wave:
The weekly shop has for me been our biggest saving. I shudder when I think how much money we have wasted over the years. I now shop in several places. Still usually supermarkets but I regularly buy certain things from certain places where I know they are cheap.
Good Luck

Busymumofthreeplusdog

Thanks jackieblack, rainbowbridgereturns, Alchemilla, Arbroathlass,:D

Im thinking DH and I need a few more discussions! We have time on our side yet to make the right decision. I was thinking last night of a compromise of paying off half the mortgage and investing what's left. Just another idea to add to the discussion I suppose.

Was hoping for a NSD but forgot I had a dental appt! still good old NHS it was only £15:T DD tried to persuade me to get takeaway on way hone but I was strong and said no! Not that strong really she wanted M*Ds!!!;)

DH away on work thing for a few days so it's veryBusymumofthreeplusdog! Currently trying to persuade the DS2 that he really needs an early night but he's not buying it!

Thanks for your comments so far....

Busy

mrcow

The independent financial advisor will obviously advise you to invest. Otherwise, he gets no comission. It's what they do!

It's not his life's savings to gamble with.

Pay off your mortgage and enjoy the well earned retirement.

Alchemilla

I say Moo to that.

Secret_Saving_Squirrel

Hello,

I agree. If the mortgage rate is higher than the savings rate it is costing you money to invest.

Good luck,

Squirrel x