Balancing the books

tjp70

Welcome to my diary. This is a diary for many things; paying off the credit card, building up savings pots, starting a small business, paying down the BTL mortgage and saving for retirement. There doesn’t seem to be a natural home for this diary on the forum, as I’m doing a little of everything, but as I have found the mortgage free wannabees the friendliest group, and I do have a mortgage to pay, I would like to stay here if you all don’t mind.

So about me. I’m 48, married to DH for 25 years and we have 2 children. DS (22) lives with his girlfriend 25 minutes drive away, DD (18) lives at home and is just about to finish college.

With the help of this forum, we paid off the mortgage on our house in July 2015, eight years early. We then started saving and with some surplus endowment money, we purchased a small BTL property in November 2017. The £120,000 BTL mortgage is interest only and we have been slowly building up an emergency fund for the BTL property should the roof fall off or the boiler pack up. We do make teeny tiny overpayments to the mortgage, but not enough to make much of a difference to the outstanding balance.

DH works for a large insurance company and is very happy in his job. Unless he is made redundant (which is very likely in his industry), he is happy to work there until retirement. I have been a bookkeeper for many years and currently work part time for a marketing company. I don’t particularly enjoy my job, nor do I work enough hours; so I am thinking about setting up a small part time venture to fit in along side my part time job. The dream is that I could earn enough in my new venture to quit the bookkeeping.

For many years, we have saved money but put all large expenditure on 0% interest credit cards. Once the money goes into ‘savings’ I am extremely reluctant to use it, as I hate to see the balance going down. However, the large credit card balance distresses me. So just before Christmas, I created savings pots for the major things that crop up – car insurance, house insurance, pet insurance, car servicing and Christmas. These pots are slowly building up, whilst I am chipping away at the credit card balance. DH will get his annual bonus at the end of this month, which should shave a good chunk of the balance off.

As I have previously been self-employed for many years (although no longer) I have not paid into a pension plan, preferring to pay down the mortgage instead. The main reason we bought the BTL property, was to provide a monthly income, to help with my pension shortfall. We are continuing to save money each month, and I find ourselves in a bit of a quandary as to what to do with it. DH would like to purchase another BTL at some point, so I have been leaving our monthly surplus in a bank account.

We love holidays and this is where we spend the most money. Holidays and food! We love takeaways and having yummy food but that is not helping our waistlines or my attempts to be frugal.

I am a great fan of reading minimalism and F.I.R.E blogs – I only wish that I had discovered them sooner in life.

My current plan is to try and be as frugal as possible (which is not easy when DH is not on board), and to keep sending small payments to the credit card to get that balance down.

So, some numbers: the credit card currently stands at £3,452.09. The BTL mortgage stands at £119,738.33 (it was £120,995.00 in November 2017).

Sorry it has been a mammoth post - if you are still reading, thank you

lvm

I, like you, am completely obsessed with minimalism and F.I.R.E blogs, mainly videos on YouTube. It's amazing to see how some people have got rid of their mortgages in just a few short years.

I'm trying to use them to get the motivation to pay off my 6 BTL mortgages so I can decrease the work and do much more travel!

Looks like you're off to a great start with being home-mortgage free already though!

ShineALight

Hi TJP70,

Another fan of fire blogs here (so far spending more time reading them than doing much about it, but hey-ho). And another new diarist popping in to say hello!

Have subscribed and will follow your journey with interest as BTL is something we're hoping to do in the future.

tjp70

lvm wrote: »

I, like you, am completely obsessed with minimalism and F.I.R.E blogs, mainly videos on YouTube. It's amazing to see how some people have got rid of their mortgages in just a few short years.

I'm trying to use them to get the motivation to pay off my 6 BTL mortgages so I can decrease the work and do much more travel!

Hi lvm. I didn't realise that there were F.I.R.E videos on YouTube. I shall have to investigate. You have 6 BTL properties - that's impressive. Thanks for dropping by.

ShineALight wrote: »

Hi TJP70,

Another fan of fire blogs here (so far spending more time reading them than doing much about it, but hey-ho). And another new diarist popping in to say hello!

Have subscribed and will follow your journey with interest as BTL is something we're hoping to do in the future.

Hi ShineALight. I shall subscribe to your diary to follow your journey.

Small wins today - firstly it would have been easy to have a takeaway last night as we didn't fancy the meal from the meal plan. But we came up with a compromise from the cupboards, which was good all round. Secondly, DS popped round today and I really wanted to take him out for lunch, but we didn't. And finally, instead of paying £11 for 2 kilos of specialist cat food from Mr S, I found it online cheaper. I ordered 20kgs at £54 so that was £2.70/kg instead of £5.50/kg. I now just have to find room to store it when it arrives :rotfl:

LeighofMar

Welcome. It sounds like you have a lot of goals, which is great. I'm like you. I hate seeing the balance of my savings go down, so I never touch it and pay off everything with wages and playing around with cash flow. Might be a weird way of doing things, but it seems to work for us and I am able to continually add to our savings. Congratulations on all your mortgage free and savings goals.

lvm

tjp70 wrote: »

Hi lvm. I didn't realise that there were F.I.R.E videos on YouTube. I shall have to investigate. You have 6 BTL properties - that's impressive. Thanks for dropping by.

Oh no - I apologise in advance for the many hours you are going to end up spending watching these. #seriouslyaddictive

tjp70

Morning all. Yesterday was a good day. Our tenant paid her rent so I sent an overpayment of £144.40 to the mortgage. I did a small amount of overtime at work and I had an eBay sale.

I also told DH how much we had spent on eating out and takeaways, and you probably all heard the thud as his jaw hit the floor!! I can now confirm that DH is onboard with cutting down in this area

tjp70

Two more hours overtime yesterday and another eBay sale so I’m very pleased with that.

lvm - I’m now quite addicted to watching Mamafurfur videos on YouTube :rotfl:

tjp70

Yesterday DH was paid his annual bonus. I sent it straight to the credit card and then cleared the remaining balance with savings. So the credit card is gone. I have never taken the money from savings before and I’m actually okay with it, because I can now focus on watching the savings grow.

DH is still shocked at the takeaway spend so has devised a plan! I’m loving him being so involved. He wants us to withdraw £25 cash each week and place it in a pot. All takeaways have to come out of the pot. Anything left goes to holiday savings (we have a big holiday booked for next year). He thinks that we will be less inclined to spend on takeaways if we are spending cash. I totally agree, as I love to see the money pile grow.

In other news, 1lb weight loss this week

greent

Hello! Am in a similar-ish boat to you - but am (just) 49 and 2 of ours (21yo and 18yo) are away at uni and we have another 2 (13 and almost 10) at home for some time yet!! We also paid off our personal mtge early in Jul 2015 and have an IO BTL mtge - which we're gradually paying down - although not as quickly as originally planned, as we also have a big holiday next year!

My OH, though, is a takeaway fiend - he does get to eat takeaway 4x/ week on expenses, though (works away Mon-Fri, usually) - but he'd still happily eat it another once or twice/ week!! :eek:

I'm ignoring all suggestions of Y0utube videos, though - I spend enough time wombling around FIRE and early retirement blogs, without adding any more distractions into the mix!! :rotfl:

I look forward to following your journey

Happier_Me

Good luck on your journey to pay down your BTL mortgage. If you're aiming for Fire then it would be a good idea to review your pension savings as it's sensible to have a mix of income streams in retirement. It's certainly worth looking into any company pensions that you or your DH could/already pay into to ensure:

• You're receiving the maximum employer contribution available - it's free money afterall
• If either of you are higher rate tax payers, you consider increasing pension savings ideally to reduce your earnings below the higher rate tax threshold, if you can afford to.
• You take advantage of any pension salary sacrifice schemes - these save NI as well as tax.

I'm trying to spend more consciously at the moment, so avoid spending just because it's easy (so no shop bought lunches, coffees, takeaways etc). I can then redirect these 'savings' to experiences. (theatre, tribute bands, weekends away, holidays etc).