Saving to avoid a mortgage

mizmir

Hi everyone - long time MSEr but have spent most of my time on DFW. We took advantage of a relocation to sell our house and pay off our debts so - as of yesterday - we owe nothing to anyone for the first time in my adult life! Feels fantastic - if a bit surreal. But the downside is we also no longer have our own house. We are currently renting and have been lucky enough to find a house we love - rural with a bit of land - and as it is managed by an estate, we are looking at a long term let. So our intention is to stay here as long as we can - and if possible until both I and my OH retire (9-14 years from now - perfectly possible with this landlord).

But we know this won't work forever. At the moment rent is fine and is actually cheaper than our old mortgage. But when we retire we may struggle with paying any rent at all. So the plan is to save and invest to give us a pot on retirement that would allow us to buy a home outright and so avoid any rent/mortgage. Our minimum goal for that is £250K.

From what we were paying out for loan and card repayments, I reckon we can save £1k a month as a minimum at the moment plus any extra bits we can squirrel away. Later we can add my pension payments (I will get mine 5 years before my partner and will hopefully still be doing self employed work then so we could save it all). Hope it is doable - I think it is. But it will require us to commit to saving - and I know I need accountability to do that - so here I am.

To start with we have set aside £10K from the house sale plus £1K from October income. We will be talking to a financial advisor (BIL) about how to get the best return on our savings but in the meantime it is in a Santander 123 account at 3%. My initial goal is to save £1K a month until we have built up adequate emergency reserves - then to try to increase this saving.

Looking forward to this new chapter!

supersaver1000

Great idea. Have subscribed 😄

Karmacat

Welcome :j:j:j

Subscribing

edinburgher

Good idea Mizmir, will be interested to see whether BIL suggests investments as part of your mix. 9-10 years is not a short time and returns on cash aren't very good at present.

Goldiegirl

I'll be very interested to see your progress - good luck for your quest

mizmir

I suspect he will be putting together some kind of investment portfolio - was talking about stocks and shares isas as neither I nor OH are using our isa allowance. The 123 account is just to keep it ticking over while we get a plan sorted out. But will definitely report back what he recommends!

in_need_of_direction

Yay to being total debt free. Well done.

mizmir

Well the zero balances on cards are now showing and hopefully only a few days before we get confirmation of loan repayments in the post. So next job is to close some card accounts and reduce the credit limits on the others. I want to keep a couple - one mastercard, one visa - for purchases where I may want extra protection or the odd one that requires a credit card. But they will be set to pay off the full balance each month. No more credit. OH has an M&S card which gives vouchers so we will keep that as the MC (and get an extra card for me). And will look at the others to hold onto a visa card as well. But for now everything is being paid in cash - no chance that I am slipping back into any debt.

And then it is dusting down YNAB and sorting out a practical budget....

Karmacat

Woo hoo! And so it begins Back to matched betting for you, young lady as soon as you set up a separate account for it I confess, I was a bit too enthusiastic about re-opening old exchange accounts, and now I'm stuck until the separate cheque account card arrives after that, there's no stopping me

Enjoy the debt freeness :j

mizmir

Haha! Yes matched betting is on the list. But first I need to get the real business back up and running - I have essentially been "on leave" since July! (a few bits and pieces but no major efforts). I have committed to another run of my online course to start in January so that means refreshing the course, the sales pages/videos and putting together a marketing campaign for the lead up to Christmas. And only a month to do it in!

Karmacat

Ooh yes, that comes first.

And look at your sig!!!! 2028!!! You're just trying to scare me, aren't you :rotfl: