Playing with fire

ShineALight

Loooong-term lurker, first-time poster.
:hello:
There’s me, DW and 2 kids. We have a big mortgage (£238k/£320k on 1.99% until 2023), little savings (£1,800) and some credit card debt (£7k, all on 0%). We also currently have pretty terrible pension savings but I don’t want us (so-called) grown-ups to work beyond 60. Now all’s I need is a plan to get us there in 19 years.

The goals
1. Save £6k in emergency fund by September.
2. Err... Here’s where we’re stuck. Do we overpay mortgage then move by the time it comes to remortgage / save and earn more in interest to offset what we’d have overpaid? Or even move and downsize sooner, taking a hit on the early repayment charge? Need to work on the figures.
3. Live mindfully. If no one else reads it, then this diary is to keep on the straight and narrow of MSE-ing goodness.
4. Finish Couch to 5k. Have got to week 8 of 9 twice. Bah.
5. Side hustle.

It'll be baby steps but this is a start.

ShineALight

Income
Income is £4.3k in a good month and expenditure is between £3.5-£4.1k.
Last month it was £4,193 in and £3,730 out.
This month, the aim is £4,324 and £3,456. Let’s see.
April is an ouch month as there’s a birthday, school trip and MOT in the offing. We could easily top £4k.

Since a major money shuffle last October, we currently have the capacity to save between 400 and 800 a month. (The first bit of that went on Christmas.)
So, first job - create a proper 3-6 month emergency fund. We’re up to £1,800 and by the end of the month, that should be £2,400.

I’ve worked six days a week for the past decade. My side hustle (essentially spending Saturdays in work) usually brings in £7.5k a year. I essentially count this as part of my wage - I know I shouldn’t rely on it to pay the bills.

So next up is to increase this. A first foray into matched betting was not a disaster but didn’t bring in the megabucks promised, so am knocking that on the head for a while and will delve into the world of surveys, blogging, bank account switches and cashback sites, as well as looking at investing, eBay selling (my goodness, do we have some junk to flog) and taking on a third job (gulp).

Eventually the aim is to create a passive income, whereby our investments will start to pay us. Have not ruled out some property investing eventually, but we need to make sure our place is fully fixed-up first. The garden is next on the hitlist, then bathrooms.

LeighofMar

Welcome. We too are woefully behind on our retirement savings, but we will continue to slog through and will get hopefully to at least semi-retirement, which is better than the alternative of none whatsoever. The paid off mortgage is an integral part of our future retirement plans, that's for sure. I read a thread on Reddit of someone asking for advice because her father who was 82, 82!!!!! had just been diagnosed with cancer and STILL had a mortgage that she wasn't sure he could afford. So very sad. So we plan for this sucker to be gone in the next 4 years or bust!

ShineALight

Hi Leigh,

Thank you for taking the time to post, such a tough and sad situation for the poster on the thread you mention. We're kind of fearful of being in a similar situation, one of several reasons we're doing this. I suppose working after 60 isn't an absolute non-starter, but I'd rather not be someone's wage slave by then.

edinburgher

Hi there :wave:

As a graduate of C25K, the trick to making it through the first long run is to go slower! It is a huge psychological barrier, but if you drop the pace and accept you're trying to finish, not race, it becomes infinitely easier.

I've been everywhere from BMI obese and unfit (like now ) to confident half marathon runner. It gets easier

Also a one time MB fan, I did very well at the time but was greedy. What I would say is that it's infinitely more rewarding than all the penny-ante crap like surveys etc. If you have even one or two small weekly offers available to you from bookies, this will bring in as much as these other activities for far less time. You work six days a week, you deserve a life and do not have time to waste

Cashback is a no brainer if you're relatively spendy, I've made £1,800 over the years.

Best of luck :coffee:

gallygirl

Hello and welcome :wave:.

I agree with Ed that surveys are not something to look at for earning money. You can do much better elsewhere, starting closer to home.

Have you come across Rich Dad Poor Dad and the follow-up book Cashflow Quadrant? I'd recommend them (from the library or 2nd hand off Amazon etc!), though you're already familiar with passive income. Lots of good lessons in them but one that really resonated with me was that instead of spending time cutting out 5p off coupons (or doing 25p surveys!), spend your time reading about investing, pensions etc as that is a far more profitable use of your time. I think I actually blushed when I read that .

Also, rather than looking to increase your income, have you nailed down your expenditure? You're getting through a massive amount every month, do you truly know where it's all going? Do you have an annual budget and do you monitor it? Are you spending money on things to make your life easier because you're too busy earning money to pay for the things you need to make your life easier because you're too busy etc etc? That's where there are real savings to make I'd suggest. If you have very little savings and 7k of credit card debt you're living beyond your means, even taking into account your extra income.

Oh dear, this all sounds very critical, I don't mean it to be and you have a very good income so lots of potential to get out of the rat race before 60 if you really want to :T.

kaycastle

hello

I'm very intrigued by your diary and have subscribed as I'm interested to see how you progress.

I really don't want to be critical either but I was thinking the same as gallygirl about expenses. I don't have kids but we have £700 less income than you, and we manage, £300 in overpayments, 24% Salary sacrifice pension between us and £850 in savings every month. We still have nice times too and enjoy life although I guess we're more careful than most our age.

But what this must surely mean is that if you had a close look at your expenditure and did some philosophical thinking on your goals, I'm sure things could suddenly change. Then you wouldn't have to do boring surveys either.... I know the others pointed out there are better ways of earning money, I also think they are just boring You could be working on your couch to 5k instead of doing a survey. I also need to work on couch to 5k, I haven't even made it to 8 weeks yet so I'm well impressed with that.

ShineALight

Hello edinburgher, gallygirl and kaycastle, thank you so much for posting.

Ed, I'm going to revisit the MB stuff first thing Monday, you're right, it will bring in more than surveys. However, am happy for a guaranteed £1 a day or so from prolific at the mo - small steps an' all.

Gallygirl, I read Rich Dad Poor Dad a couple of years ago and loved the 'pay yourself first' mantra. Hmm, have clearly not implemented it though! Will check out that other recommendation asap.

And, no it's not criticism at all, because it's a yes, to all your other points! I do know where it's going and I'm not happy about how much we're spending. We've had a jump in income over the past 12 months and not said 'no' to anything for the past six months. We were in a 50k hole at one point, and we've worked really hard to get out of it. However, I don't like the amount of cash we're now chewing through. It's been making me feel decidedly queasy after those frugal years.
The credit card is split between an old overdraft (it was 5k and costing us a wedge in fees every month, so switching to 0% was a big uptick and we're around half-way through paying it off) and a car purchase. That car will be run until it dies, however. (Mental note to self here, I love to dream about cars but I've now set it down in black and white that I'm darned well keeping the one we've got!)

Kaycastle, will subscribe to your diary as I reckon I could learn a lot. Good luck with the C25K-ing! (I truly detest running, but know it's good for me.)

There are so many things to do. But first things first. I know we've had a leak in one of our loos, like forever, and it's impacting our water bill. Plumber contacted.

And thanks to all your replies, they've made me doubly determined.

Busy_Mee1

Hi Shinealight - great new diary. I agree with the others, you are already busy so focus your time on those things that pay well.

I have a busy job but have made well over £1k in bank switching bonuses (an account each for each bank ) and try and earn £1k per year in tax free interest by cycling money through 5% regular savers. This isn't for everyone because it involves multiple bank accounts and a level of organisation to meet all the eligibility criteria.

Other than that there is the whole process of really examining your expenditure and making conscious decisions about how you want to spend your money. Examine every single standing order and direct debit to see whether you really want to spend that money- even small amounts add up.

The biggest saving we made was a switch from shopping in Sainsbreeze and spending £130 per week to shopping in Aldi and Homebargains and we now spend around £65 per week. A whopping saving of over £3k a year and we seriously eat better. This because I meal plan and generally cook from scratch and are more mindful about what we buy.

I can't remember who said it but apparently those people who grow their own wealth do so by saving more of their earnings rather than making clever investments. Although I imagine doing both is the best way of getting to be really wealthy: )

shangaijimmy

Welcome aboard. Tons or experience and advice on this forum and you'll find what works for you. For what its worth the mental side of it is the key...be prepared to be in it for the long haul, and don't get frustrated by those months when life gets in the way (car problems are our biggest culprit). My top tip is a daily TT...it feels like progression even when the month feels like a mortgage trudge.

ShineALight

Thanks for the advice Jimmy and BusyMee. Everyone who's posted so far has been a brilliant help.

Baby steps taken:

• Started setting up two sole HSBC accounts.
  One for me and one for Mrs S. We only have one joint bank account between us and have had for years. So, if I've read it right, according to the Ts & Cs we don't get get the £150 switching bonus if we create two new accounts by switching from the same original account. Mrs S's will therefore be a donor account for future switches for other banks' offers. Hope that's the right way to do it.
• Checked company pension.
  I've been playing around with the figures and it looks as though I could have underestimated this. Not a game-changer but need to do some spreadsheeting to understand the numbers. TBC.
• Updated my spending spreadsheet.
  It could well be that we're on target to save more than expected this month. No chickens have yet been counted.
• Didn't buy any wine this weekend.
  Drank flavourless beer leftover from a party last month. Just one bottle. One. Thumbs up for money saving and ability to get out of bed in the morning. Thumbs down for fun. Ah well, it'll do for this weekend too (possibly the next 11 at that rate of consumption). In the spirit of money saving, Mrs S has promised she's 'only' drinking the gin she got for Christmas...how thoughtful.

To do
Sun's out so am off to start at the start and do week one run one.