Peering over the hill...

Grogged

The January Update

January’s update is sponsored by shed monthly.

Usual money stuff first; gossip, tea and biscuits follows...

 

Mortgage

Jan 2021               £87,985

Jan 2021               £87,328

Change                 £657

%Change             0.7%

Overpaid             £3,009

Jan 21 OP            £61

 

The goal for 2021 is to pay off £10,000, with a view to paying it off in full in 9 (stretch of 8) years.  We’re scheduled to pay £8K off through normal payments.  I will look to make between 2 and 4 extra payments throughout the year.  Our NW mortgage is structured so that if you OP by at least £500 you get to either instantly reduce eth term or monthly payment.

Currently at £61 of the £2,000 target for 2021.

 

EF/Cash

Jan 2021               £24,550

Jan 2021               £25,900

Change                 £1,350

%Change             5.5%

Target                   £27,300

In Jan 21               £1,361

 

R@tesetter have announced that they are closing and will repay all outstanding loans and interest in April.  Whilst we’ll get less than £100 back in total, at least it will be in one payment, rather than monthly over the next 4 years.

The plan for 2021 is to add a month to the EF and continue this every year going forward.  This will enable early retirement if needed (although not by much!).

Each month I aim to open a new 12 month high interest (lol) account to try and maximise the EF savings.  This will ultimately provide a years buffer, the excess will be held in PB, etc.

We had a small PB win this month, which was nice! 😊  Already a return of 0.9% this year, which beats many savings accounts.

Pensions

Jan 2020               £221,400

Jan 2120               £223,000

Change                 £1,600

%Change             0.7%

Target                   £350,000

In Jan 21               £1,677

 

Pension (as dividends if taken today)

Annually              £2,113

Target                   £11,490

Monthly               £176

The state pension would be added on top of that (another £9K at today’s rate).

This could be boosted by drawing down on the capital, etc.

 

V@nguard finally closed the old pension and transferred the final tax rebates over to ii.

Each April we’ll also be trimming the company pension back to under £1,000 by doing a transfer to ii.

 

Over the course of 2020 we consolidated and moved all the pensions to one provider each, in my case to ii (fixed costs are cheaper) and MrsG to VG.  We’re slowly starting to see the benefits from doing that, from only having two pensions to manage and in terms of return.

 

We are mortgage neutral with our savings, so if needs be, at least the mortgage is covered.

 

Grogged Towers News

 

The new shed has been filled 😊 with some things we need to keep long term. Lots of lovely carefully packed plastic boxes.

This has allowed space to be created for a new office for me, downstairs with a view of the back garden.  This has made the living/dining room a work free zone, with household life returning to a bit more normality.

Work has been manic, planning around the new lockdown and furloughing some of the team (at least I’ve managed to avoid long furloughs – people are been furloughed a day a week).

We’ve also ordered a humidifier.  It’s noticeable how dry the air is and we seemed to have a few more dry coughs than normal.  It’s early days, but it seems to be helping.

Stay safe,

G.

Grogged

The MrsG January SIPP Update

 

This is the story of the good SIPP MrsG which started her voyage in June 2020 with an investment of £1,440 and a transfer from a previous plan.

As MrsG earns no income, her maximum contribution per year is £2,880, which the kind tax man will top up to £3,600.

 

The aim is to get a pot of £50,000 by retirement in 2035.

 

Currently contributing £200 per month (£160 + £40 tax relief).

 

The portfolio is fully invested, with the aim of keeping a running cash balance of £5 to cover the quarterly charges.

 

Weight Symbol Investment

84%                        Equities

6%          VMID    FTSE 250 UCITS ETF

21%       VHYL      FTSE All-World High Dividend Yield UCITS ETF

26%       VWRL    FTSE All-World UCITS ETF

31%       VEVE     FTSE Developed World UCITS ETF

160%                     Bonds

16%       VAGP    Global Aggregate Bond UCITS ETF Distributing

 

January                £12,723

December           £12,599

 

Whilst January had a good start, all the gains fell away at the end, due in part to Gamestop and the effect that had on the markets.

 

Average monthly income is £11.35 after 8 months – a quarterly dividend was paid on New Years eve.

The estimated annual income is £116 after charges.

Total return to date is 5.8%, estimated annual return is 4%.

 

Annual values are calculated as (current value / portfolio age) * 12.

They will be a little patchy until a full 12 months have elapsed.

 

The bond funds pay dividends monthly and the equity funds quarterly.

 

The current weighting is 84/16 equities/bonds.

The plan is to move to 80/20 by retirement.

 

Each £160 monthly payment buys one VEVE share, the rest is deposited as cash, with a £40 government top up 8 weeks later.

This flexibility allows the right weightings to be maintained going forward.

The portfolio is kept balanced after every monthly and dividend payment..

 

After moving the main pension portfolio to Interactive Investor, we've decided to simplify the portfolio going forwards.

 

The aim is for simple 5 fund portfolio that replicates much of what a LifeStyle fund would do, but at a cheaper cost overall.

 

The portfolio is held with Vanguard, which whilst not the cheapest, is fairly close for the level of investment and peace of mind.

 

Stay safe,

G.

savingholmes

To be mortgage neutral must be a great feeling. Glad you are topping up your wife's pension too. It all helps.

Grogged

Thanks @savingholmes.
We'd be paupers if we had to cash in today, but at least we'd have a house!

In nerdy news, updated our annual spending (downloaded bank transactions since 01 February 2020).
Nearly all discretionary spending gone, eating out, some supermarkets, etc. dropped off the radar.
Some of that has been absorbed by @ldi, Amaz, etc.
Still a sizable saving, which has been recycled into the EF and pensions.

savingholmes

Congratulations!

Ami-Rose

Annual spending report sounds so satisfying, like music to my little nerd ears! 😂 I'd probably be horrified at ours though. We seem to have taken all of the savings we could have made in lock down and spent the lot on chocolate. Yesterday I joked that I've gained the Covid 19 - lbs in the last year!

Glad things are ticking along nicely for you.  

South_coast

Covid 19lbs - love it 🤣!

Grogged

Thanks guys!
@Ami-Rose biscuits are my nemesis...
I must admit that at one point I did consider using the shed as a giant biscuit barrel! 😆
MrsG was like "let me show you the stare I taught Paddington"...
I know I should do better, but I've also suffered from the Covid pounds...😟

Grogged

@caeler has spurred us on to check out our current deals.
After a conversation with Voda about our broadband, we've just switched to n0w, saving £8 a month.
Rest look ok,our house insurances due to renew in March, so that's next...
Wonder if we'll get a call offering to price match...

caeler

Woop woop! Love that you are saving some money!