Reeling from the Reality Check

in_need_of_direction

what's the interest rate like on your mortage?

sweetpea26

Hi HB

I would personally pay it off the mortgage.

You are doing so well HB

Historybuff

Interest rate is 2.5%, INOD and no penalties for paying more off.

in_need_of_direction

I'd throw the money at the mortgage

Historybuff

Thanks, INOD, but what if I need some for an emergency? I'm still thinking about it.

Eager_Elephant

How much have you got in Premium Bonds?

How much did you win this year/last year?

When you talk about emergencies what kind of things are you worrying about?
Have you got any savings other than Premium Bonds?

in_need_of_direction

What do you estimate your emergency fund requirement to be? Also, is there any chance of making an offer relating to outstanding debt?

Cherryfudge

Hello HB,

I've read your diary cover to cover... just wanted to say you are amazing and thank you for writing it down. It's truly inspiring.

Did you come to a conclusion about premium bonds vs mortgage?

Cherry

Historybuff

Hi All, Thanks for your interest. There's £25,000 in premium bonds and in the past two years I have had £750 in prizes that has been reinvested. No other savings.
Emergencies I'm thinking of are, weddings to contribute to, getting ill and unable to work, car packing up, home maintenance, that kind of thing. Having the money tucked away, but easily accessible if needed makes me feel secure. I have never had that before having always been at the end of the money well before payday in the past with no savings at all.
The £25,000 is ten months salary, so I think it is not excessive as an accessible savings pot. I have decided to leave it where it is for now and overpay the mortgage month by month as I am doing at present.
The one debt I have left, I have tried to make a p and f offer, but they want a ridiculous amount to settle, so I'm continuing to pay the small agreed amount for now and will try another p and f later.
The new system of budgeting using different bank accounts has worked well. Having the monthly spending money totally separate is helping me stay in spending limits. V good.
Feeling secure and in control of money and finances now, which is a great achievement, I think. Go me!

Eager_Elephant

So roughly you have earned interest of 1.5% each year - you would get more in certain savings accounts but of course then you have no chance to win the million!!

Apart from getting ill and being unable to work the other things are foreseeable so could you start saving money towards each of those things ready for when it is needed?

I also don't think £25k is too much money to have in savings and if it gives you peace of mind that is all that matters.

You are doing really well HB - such a change from when you first joined.