Potential Redundancy

Easysilence

Hi


I'd like some thoughts on what my fellow MFWs would do in my situation ....





I've been chipping away at my mortgage for about a year now. Not huge amounts, just whatever was left over at the end of the month - no more than £300 a month, plus a couple of other small lump sum amounts that have come my way.





I love seeing the mortgage balance going down. Even more, I love seeing the amount that goes back on in interest reducing every month.





I'm hooked!





Problem is, now my job is at risk. I'm ok 'til the end of the year and with any luck either I’ll get an internal transfer or have a shiny new job lined up to start at the beginning of 2019.





But I don’t know ….





I have enough in savings to keep me plodding on for 10 months or so without work so it’s not an immediate dire situation. My first thought on getting the bad news was the overpayments on the mortgage need to stop now and the money diverted to the savings account to keep me going a little longer. If I don’t end up out of work I would have then paid whatever had accumulated in the mortgage overpayments ‘pot’ off the mortgage.





Second option is to hope for the best and carry on paying the little amounts off as I had been doing and carry on loving seeing those numbers go down.





The first option is the sensible one, but I’m torn …..





What would you do in my situation?

bexster1975

Hello

Sorry to hear about redundancy risk.

I'm afraid I agree option one is certainly the most sensible. I know that's not what you wanted to hear.

How long are you realistically likely to be out of work? Is it so likely you will be made redundant that it's worth looking to jump early? How much redundancy are you likely to get ( no need to share numbers on here, just worth considering if you look to jump ship beforehand). The thing is, as you rightly say, if you don't spend any/much time out of work you can use much of the savings pot to overpay. In addition, overpaying the mortgage is as much for moments like this, when things go a bit awry, as much as it is about clearing the mortgage.

A temporary blip at worst. Well done on your progress to date, fingers crossed the time without work is limited.

Bexster

EagerLearner

Sorry to hear that Easysiilence, I agree, I'd go for option 1 and reframe it in your mind that it WILL be overpaid soon as you have that shiny new job. You'll sleep better and it's more secure for you.
Are there any expenses you can trim now to help mind the gap a bit in the meantime?

zcrat41

I agree. Save up - this might be the rainy day you need it for. If you get a job quickly you can whack it on an overpayment then.

I sometimes don't overpay my mortgage. It goes into my "mortgage offset account" so if I need it for emergencies it's still there. Psychologically though it's overpaying the mortgage!

Sanne

I’m with everyone - save into an account now, if all goes well job-wise overpay by more then!

Busy_Mee1

I agree too. I don't overpay my mortgage because our interest rate is low and I can beat it by saving in higher rate interest accounts. Tracking your savings is just as addictive as paying your mortgage off, particularly if you give yourself little challenges and targets. And you will have a lovely lump sum to pay off your mortgage when you get your new job.

Urbanshyne

Option 1. No doubt. Best of luck.

Easysilence

Thanks guys for your answers. Of course I knew you'd say that!
I shall just enjoy seeing the numbers go up in the virtual mortgage overpayments pot instead!

How long will I be out of work for is the big unknown. I like a bit of certainty in my life - don't we all! When I first got the news in late July I wasn't actually too upset. The job hasn't been going the way I'd have liked it to for a while now and this was the kick I needed to do something about it. Reality set in after a week or so when the new job offers hadn't come flooding in and I realised actually I seriously need to make an effort here! My first thought was I want to jump ship now. I've only been in the job 3.5 years so the payout isn't going to be much, the company is mean so we will only get statutory redundancy. But then when they have me my actual figures, they've upped my no. of years service to 4 (I would have missed it by 2 days) and are also giving me a month's PILON so my payout will be equivalent to about 10 weeks pay. Not loads, but worth having. So I thought then maybe I'll hang around to get it, much as I don't want to. So there was me plodding away not doing anything about it and a recruiter contacts me, I've got an interview next week and the pay is similar to what I'm on now. It's only an interview, not a job yet, but depending on how I feel about it after the interview I probably will sacrifice the redundancy pay for a secure job. It's all so very unknown!

Thanks again for your feedback, it's always good to have other people's take on the situation!

bexster1975

Good luck with the interview easy silence.

May I just say, the last two years of my life have been the least certain of my entire adult life. They have also been the best. I think it is human nature to grasp to certainty. It sounds like your current job/employer is not as great a fit for you as they could be. If you like the job, but not the company, the new option might be a great move. If you hate the job, maybe less so. I wouldn't stay if I had a good offer I was happy with in a job I disliked for ten weeks pay.

Make sure if you are offered the new job, you want it. Sometimes situations like yours come along to enable you to shake things up a bit.

Good luck whatever you decide

Bexster

AnotherJoe

I would save instead of overpaying and then when i got a job again would focus on pension before overpaying mortgage. It might be addictive but in most cases its an expensive addiction compared to the money you are losing by not getting taxable and investment benefits of a pension

Good luck with the interview.

tootallulah

Good luck with the interview. A new job will help focus your thinking and if you don't get this one then maybe you will hit the Holy Grail, new job and redundancy in your hands.