Dream to be mortgage free by 40

abi_a_mfw_mum

Managed another NSD today, aiming for a NSD on Friday as well.


I need to make a decision about my workplace pension. My work has three schemes, two defined benefit and one defined contribution. I'm currently part of the defined contribution, but have been meaning to change scheme for a while. I've got a one off opportunity to join one scheme, until September. The problem is I don't fully understand the details of one of them. Is anyone on here good at deciphering jargon from pension schemes?
Next job is to sort of the broadband and phone line. I saw a good sky deal on the mse email this morning, so we might go with that if I get my act together.

elleandie

I'm also a fellow 28 year old MFW :j

Will enjoy reading your diary

abi_a_mfw_mum

A mixed end to the week, but mostly positive. I managed a NSD today, DH got the groceries for the week for only £18 (I gave him a budget of £25 so pleased with that), and the travelling expenses for the medical trial DS took part in should more than cover the cost of getting him there (it's not invasive or anything, just a study of his growth and development) so that's all positive
On Wednesday I ordered some sheets for the new cot bed DS is using (cot will be needed for baby), I got 2 for only £6 and should get 8% cashback as well. Unfortunately whilst on the site, with 25% off I also ordered a maternity/nursing wrap dress. It'll come out of my pocket money so not the end of the world and I'm going to need comfy summer dresses with an August baby!
I'm aiming for pocket money spending this week of £10 or under, so far I've spent £5.75 so I've just over £4 for the weekend. Not planning anything expensive so it should be fine. I may take DS to soft play as I found a voucher for free entry :money:
Hope you all enjoy your weekends.

abi_a_mfw_mum

I feel like I'm only making slow progress at the moment, and I'm realising the scar of the mountain there is to climb. Playing around with overpayment calculators has shown me that we need to be overpaying by £400 a month, to hit our target. We're currently putting aside £250 a month so need to find an extra £150 a month :eek::eek: This year it should be doable because of my bonus and some time when we'll have extra income but it's a lot of money to find.
I think I need to list my progress to help me feel like I'm getting somewhere. Progress isn't being helped by feeling absolutely exhausted from the pregnancy at the moment but I just need to keep going.
Progress so far
Signed up for cheap Sky internet deal, which also doesn't need an upfront line rental payment so that's one less lump sum to find.
Found out that our energy refund will be nearer £400 than the £200 I thought :j on the other hand it could be over 6 weeks until we get it:(
Stuck to my personal spend budget last week and haven't started this week's budget, as spent remainder of last week's budget on Monday and had a NSD today.
Have done some research on bank accounts and switching so I can start playing the banks a bit.

Things to do
Final decision (including convincing DH) about which bank accounts to open, and open them
Find way of selling old garden gates, even if they need taking to a metal scrap yard for some pennies
Write shopping list of things for the new baby and find best deals. Thankfully I don't think this will be a long list as we have most of what we need.

Slow progress is still progress, or so I keep telling myself

abi_a_mfw_mum

Hi all,
A nice low spend week so far. I've only spent £2 of my £10 personal spending money, so I think I'm going to give myself a target of only another £18 to the end of the month. I need to buy some clothes and have a haircut, and if I stick to that target I'll have enough left at the end of the month to cover those. I did spend £31 in IKEA yesterday on a duvet, pillow and duvet covers for DS but that was budgeted for.
This weekend will also be an expensive weekend, but all budgeted. We will be buying a second car seat, and because it's ERF it will be nearly £400 :eek: Still, the money is there, I have a 10% off voucher for the shop and will use a cash back credit card, and most importantly it will keep our children safe. We will also be buying some more furniture for the nursery, but that will only cost £40, and eating lunch out. This is our only planned meal out this month, so I'm hoping some surplus eating out budget can be saved after the weekend.
Enjoy your weekends all

abi_a_mfw_mum

Sorry for the posts in quick succession but reading some other diaries has got me thinking (thanks SuperSavingsSquirrel).
Given how low our mortgage rate is we should be able to earn significantly more interest on savings than we would be able to by overpaying the mortgage. This also gives us the flexibility to use the savings for a big renovation of the house if we chose to. The reason I'd been hesitating about this was wanting the security of the balance going down and also because the bank were quite reluctant to lend to us last time given DH is on a fixed term contract. However my head is saying that money in the bank gives the option of overpaying at any time, and maximises our returns so I think I will change my goals to increasing our savings. I will then measure our mortgage offset balance (mortgage balance - savings balance) as my main indicator of progress.
Realistically we should be able to save £800 per month. That said, we will probably end up spending some of our savings each year. I am therefore aiming to increase our savings by £8000 a year, and decrease our offset mortgage balance by £11000 per year. That way we would realistically have our mortgage offset in 10 years, providing we don't spend all our savings!
First job, make sure all savings are earning more in interest than the mortgage costs us.

chelseablue

I was thinking about this too.


Our mortgage rate is 1.49%


I have £11,000 in savings earning 3%


The reason I want to overpay is our mortgage is a large amount and I'd like to see the balance go down a bit for when our fix ends in 2018.


We can normally save about £1,000 each month so my plan is to overpay the mortgage £300 and put the remaining £700 into savings until its at the £20k limit (its the Santander 123 account)

SuperSecretSquirrel

With a mortgage rate of 1.69% I think you would absolutely be doing the right thing saving rather than overpaying. I'm juggling a number of current accounts and regular savers at the moment, they pay between 3% and 6% interest, that's a nice bit of profit available to you

Since your mortgage allows unlimited overpayments, should things change in favour of overpaying rather than saving in future, raid the savings to reduce the mortgage. I can't see a downside, so long as you are disciplined

abi_a_mfw_mum

Thanks for the advice all. After finally getting round to discussing it with DH he is is onboard (as long as I manage the accounts). So this evening we have upgraded to the Nationwide FlexDirect account (5% on up to £2500), opened 2 TSB accounts (5% on up to £2000 with option of linked regular saver) and one Club Lloyds account (4% on £4000-£5000). This should cover our current savings, apart from our Zopa account and our regular savers which are high paying anyway. When the regular savers mature we'll need to think again as there'll be lots of money to find a home for then. Tomorrow's job is to start setting up all the standing orders and direct debits to fund them and comply with the T&Cs. Still, should be a good return on investment of time as will more than double the interest we earn :money:
Other than that I spent lots of money today :eek:, buying a new car seat for DS, more storage for the nursery, lunch at IKEA as well as our weekly grocery shop. Still, all of it was budgeted for, and we should have some nice surplus balances to send to savings at the end of the month
Hoping for a quieter day tomorrow, today has been very busy! Hope you're all enjoying your weekends.

abi_a_mfw_mum

Unplanned day at home today. DS had a bit of tummy trouble so we had to keep him home, not send him to the childminder, in case he's infectious. So I'm on annual leave today, with a grumpy child who was miffed it was raining this morning. Still I've saved the cost of petrol to work and parking.
Trying to use the day to good advantage, so all the baby clothes have been sorted and stored where they will live, and I've washed the baby car seat covers (by hand ). Have also done some shopping, but it was all planned purchases and I've used quidco so at least there's cashback coming my way for the savings pot.
Can't wait for the internet banking activation codes for our new accounts to arrive so I can set up standing orders and transfer direct debits. Hopefully they'll arrive soon so I can get going and earning more interest