Diary of a madman

OnlyGuyWhoLikesTwix

So after much deliberation and thinking of my routes (see my post history for previous questions), I've decided that a plain old overpayment is my best way. So my current mortgage details are:

20/03/2018: £146,922.15
Interest rate: 2.39% fixed for 5 years
Current payment: £692.51

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Before I started, I checked out a lot of different savings vehicles but decided that my current savings pot doesn't really do much in terms of actual investment into stocks and shares and the like. Basically the risk increases too much to make it worth my little stash.

The first thing I did with my little windfall is paid off all my interest bearing debt. I closed one credit card and kept the other zero balance for just in case things happen. That's currently in my bottom drawer and not likely to see the light of day again. I paid off my car, but I left my Ikano finance as it was simply as it's zero percent already and only has another 13 months to run. At £45 per month, I won't care about it too much.

I have also become great at eating cheaply. While I don't deny myself taking out people I'm dating or whatever, I generally myself live very frugally. I pre-cook almost all my meals, I shop at times where I know certain bargains will be had and have made use of the nearby markets for fresh vegetables which lasts amazingly much longer than anything supermarket. I don't generally drink too much so my alcohol budget has always been low.

The crucial thing I did was get my last 13 months bank statements. That not only allowed me to decide what a reasonable budget for everything would be, it also allowed me to plan for things like average costs relating to Christmas, birthdays, gigs with my band and various shared costs to that. It took me several evenings to come up with the ultimate spreadsheet, but it's done now. The amount I was paying in interest to my CC left me shocked. So I'm very glad that is gone.

With everything done, I have £5912 put into my Cash ISA which is called my rainy day fund. I have kept money out to replace my front door which is just plain needed, but I didn't include that in my calculations. The money is there, it won't cost me anymore than that, it's a non issue.

I have no other interest bearing debt and intend to keep it that way.

My average monthly income is about £2700. I work two jobs, with one being full time role and the other more freelance. I decided that I wouldn't count almost any of that income as it is completely variable. Anything I take in from that role I will put in my ISA too and not consider it for overpayment. It will also take care of my tax bill for that role.

So with my regular monthly expenditure (including mortgage) coming to the £1244 mark (taken the highest amount I have spent on the regular outgoings over the last 13. I live alone so live quite cheaply. I've decided that I have a 10% limit of overpayments per year. I will start off by overpaying £500 per month and then at the end of the calendar year, I will do another payment in which brings my total upto the 10% on the provision that I have at least £6k in my ISA at any one time.

So this is basically my diary and starting point. Not a massive beginning, but I will keep this thread up to date as time goes on together with any miscalculations or unexpecteds.

I'm not sure where that brings my mortgage-free date, but I'm still hoping for seven years. If I make it great, if I don't then no big deal! In short, I've decided to not worry about where the end date will be for now, just get in the flow of saving and overpaying. Then towards the end of my fixed rate, I'll decide where I am at and how/what to do next. aka How I Learned to Stop Worrying and Love the Bomb!

beanielou

Happy shiny new diary

selloptape

Good luck on your journey!

Tjh1412

Happy new diary

OnlyGuyWhoLikesTwix

So far, I've been doing overpayments of £520 pcm from my paycheck. So far so good! My rainy day fund is unaffected and as I have about 8 months worth of money in there now, I am thinking of upping my monthly overpayment to £850.



I probably won't know until my next mortgage statement what sort of impact it will all have as most of these overpayment calculators say wildly different things. I still have 8 years as my target MF date though,