Can i join your club???

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  • AnotherJoe
    AnotherJoe Posts: 19,622
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    dano17439 wrote: »
    Morning!


    Happy new year to anyone reading this. I hope you had a nice Christmas break?

    Maximum payment of £2,293 made yesterday so currently balance less our savings is £48,928. Potentially 21 more payments of this amount until we're freeeeeeeeeeeeeeee

    I had an interesting "discussion" with my wife over Christmas. I can see the financial sense in it but I couldn't convince her

    She owns a 2014 Mercedes A45 AMG. I estimate it to be worth approx. 22k and its fully paid off.

    I have a seen a cracking deal for a brand new A35 to lease for £412 per month over 2 years. The A35 is a slightly watered down version of the A45 but not by much

    I suggested to her that we sell her car, use the money to put towards the mortgage balance , meaning we would be mortgage free in approx. 10 months and that we lease her an A35. She flatly refused as she loves her car so much and doesn't want to change it yet.

    She wouldn't entertain that we could pay the house of in half the time, and that she would get a brand new car. For me it make total sense but she just wouldn't agree. Quite frustrating for me I must say, or am I just being to sensible?


    Or you could pay down the mortgage with the £412/month you wouldnt be spending on a car.
    Or she could put that money in her pension and come up considerably better when she retires.
    Or split the difference between both.
  • dano17439
    dano17439 Posts: 366
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    AnotherJoe wrote: »
    Or you could pay down the mortgage with the £412/month you wouldnt be spending on a car.
    Or she could put that money in her pension and come up considerably better when she retires.
    Or split the difference between both.


    1) The £412 would come out of the mortgage overpayment amount we are paying already so this is not spare money if you like


    2) Yes agreed this makes sense. We already have near £1,000pm jointly going into our pension pots and approx. 200k already in various schemes, therefore our short term priority is to clear mortgage then bump up pension contributions when we have no mortgage. We are both 43 so have a bit of time yet


    3) Won't happen anyway as she doesn't want to change her car yet
  • AnotherJoe
    AnotherJoe Posts: 19,622
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    dano17439 wrote: »
    1) The £412 would come out of the mortgage overpayment amount we are paying already so this is not spare money if you like

    2) Yes agreed this makes sense. We already have near £1,000pm jointly going into our pension pots and approx. 200k already in various schemes, therefore our short term priority is to clear mortgage then bump up pension contributions when we have no mortgage. We are both 43 so have a bit of time yet

    3) Won't happen anyway as she doesn't want to change her car yet


    Generally, not a good financial* idea. The amount you are saving on interest is low and compared to tax relief (especially if you are high rate taxpayers which seems likely). And takinga gamble that the government wont remove teh 40% tax beenfit on pensions.



    You are also giving away years of pension growth in favour of saving probably 2% on mortgage. And not letting inflation work away at the mortgage for you. If your mortgage rate is 2% and inflation 3% (roughly?) then every year your mortgage, in real terms decreases by 1%. Rushing to pay it off doesnt do you any favours. Especially when the amount is quite low anyway.


    * you may derive some other satisfaction from being mortgage free thats not purely financial. eg just the "feeling" of being mortgage free. You may decide that that is worth the actual loss in financial advantage that rushing to pay your mortgage off entails.
  • jodles16
    jodles16 Posts: 1,477
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    Well done Dano! It is hard when others dont see our financial dreams in the same way! Mortgage freedom can offer so much, I think you are doing amazing work!


    Jodles :D
    MFW2020 #115 250/3000 J-250
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  • dano17439
    dano17439 Posts: 366
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    jodles16 wrote: »
    Well done Dano! It is hard when others dont see our financial dreams in the same way! Mortgage freedom can offer so much, I think you are doing amazing work!


    Jodles :D


    Thanks Jodles, I did (doing!) it myyyyyyy wayyyyyyyyyyy!


    Literally counting the months down until we're (currently) £2,293 per month better off


    It will also coincide nicely with our daughter finishing secondary school so we can take holidays outside peak season aswell which I am totally buzzing about. Plan to have at least 3 a year when the mortgage is gone! (oh and we'll probably put a bit more into the pension pot aswell)
  • dano17439
    dano17439 Posts: 366
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    Also just found out we've overpaid a total of £40,461 to date. Amazing really, theres no way we would of had the discipline not to eat away at that if we would of just saved it in an account we could of accessed easily
  • Sad times today, just completed my wifes tax return and had to pay a tax bill from our savings, which means now the NET mortgage position is back into the 50's


    However it will be short lived as we're in the position to pay the max £2,293 on the 1st Feb though which will drop us back to NET 48K owed
  • Well another month gone by in a flash, and despite it being my wifes birthday a few weeks ago, we've generally had a pretty quiet non eventful month, so although its payday tomorrow, we find ourselves still with £1,100 left over from Februarys wages, so this will be going back into the saving pot (which was pretty much the same amount we had to pay HMRC in January, which is handy!)


    So again on course to make a £2,293 mortgage payment on the 1st March.


    So mortgage balance on Friday, less savings (or is it plus savings? I can never decide lol), will be 45K!


    We've also recently booked our family summer holiday. This has to be paid in full by the 31st May so we are hoping to pay this without touching our saving. Will be tough to do I think!
  • What a great thread! The end feels so close for you, which is pretty awesome. Well done!
    #26 MFW 2023 challenge Small OPs are better than no OPs! Feb 2018 £231,000 / Apr 2042 Current £133,700 / March 2036
  • dano17439
    dano17439 Posts: 366
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    Thanks TM, 19 more payments if all goes to plan
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