DrSpendingLittle's New Home - staying accountable and responsible

DrSpendingLittle

It's weekend nap time so I've finally managed to get on here; well, after tidying up from lunch, getting the laundry out and putting the dishwasher round - the usual weekend domestic drudgery of life with a toddler who wants so much to do everything himself and make as much mess as possible doing so. Honesty, I do love it and I vehemently encourage his independence as that is how I roll, so its important to me that he feels he has a say - where safe and reasonable - in most things he does. 

I'm watching some Olympics whilst beginning to think through mortgage finances and an AIP application. We've both got the week off work and we're keeping LO in nursery (we'll have a family 'holiday' together later in August) so we intend to call a broker this week and look at what options are available to us. It's number one on our 'big list of things to get done this week'. 

I already have a spreadsheet of various mortgage options, which basically lists various scenarios of borrowing amount / monthly repayment / length of term etc etc, but we need to think long and hard about how much we actually want to borrow and for how long, given we're no spring chickens. We don't want to be house poor and take on a big mortgage just because we can, but we do also want to buy a house that will meet our lifestyle needs for at least the next 10 years. Plus fulfil some wants, too! So, not a 'dream home' by any means, rather a content home. 

We also need to maximise our LTV but make sure we maintain a decent emergency fund. This will be the first time we throw quite a lot at a house, both from our monthly income and our existing savings - our previous mortgage was based just on DF's income as I developed my career and we had more disposable income. So, I'm trying to maximise my monthly saving at the moment to be in a position to cash flow moving expenses and maximise our deposit. 

We also need to narrow down our preferred location(s) and create a 'non-negotiables and compromises' list to help us decide on the type of house we want. For instance, DF is more picky about how the house looks externally than I am; I'm more interested in internal space and layout. 

The good news is that funded childcare hours kick in from September. We received our nursery invoice on Friday and we are about £300 a month better off! This is for a month where we have very little tax free childcare money in our TFC account, so when that kicks in again in the next quarter (we get £500 every 3 months), it should hopefully be slightly higher. However, Nursery have raised prices by 10%, which I stupidly hadn't factored in, so overall the funded hours cover a little less than I had hypothesised, but that's all fine, the main thing is that nursery can still afford to run - the manager was telling me about the mismatch between funding and true costs, which must be hard for them and other providers to manage. We'll be getting twice as many funded hours next September too, so things will ease in our budget even further then, which is good in terms of thinking ahead for inflation / interest rate rises etc, but maybe also for mortgage overpayments or increasing savings for LO's future or increasing pension contributions.  

That reminds me, I need to apply for child benefit. I saw the rules had changed recent and I think that pushes us into the position where it would be financially logical to actually apply for the benefit. Up to now, we'd pay so much tax on our entitlement and have to do a self assessment tax return in January that I'd considered it just too much of a faff. I'll put that on my 'big list of things to get done this week'.

Budget is looking good - I think I'm going to let my categories / pots roll over each month rather than tidying away what's left into savings. I have much less time to myself since having LO that I am just not able to be as involved in managing my budget as I used to be. Plus, I do like to over complicate things as a matter of course, so actually, just letting various pots build over time is more time efficient. If it gets enough to notice, I'll just transfer it over to my savings account.

I was thinking about cars the other day - ours is 5 years old now and I probably need to start thinking about putting some ££s away so we can pay cash for another one when the time comes. I took a 4 year bank loan out two years ago to buy the one we have now (a very low interest rate and I wanted to keep ££ in savings for impending mat leave), which is £309 per month, so I guess when that loan ends I can continue to put that amount away each month.
So maybe we can build enough to buy a 3 year old car outright if we were to part exchange too. That said, DF's car is literally on its last legs (we've had it since 2009!) and we might need to think about replacing it as we could do with two cars now his parents are getting old and need more help around the house. They live 3 hours away, quite rurally, so we can't just all nip up at short notice and I need our car to take LO to nursery. Anyway, lots to mull over as we'd need to pay cash.

Right, back to my spreadsheet! 

DSL  

DrSpendingLittle

Andyjflet said:

I have tried YNAB multiple times and I cant get it to work for me. I get paid middle of the month too, (19th) and my DD are on the 1st so there is always an overlap when monthly budgeting. Like a month for me is second half of July to first half of August. I know the DD doesnt change but it's messy, at least in my head anyway. 

Yes I can see how middle of the month would be a pain for YNAB. It would be messy in my head too! 

Andyjflet

Are you using a particular spreadsheet or is it a self built one? 

DrSpendingLittle

@Andyjflet My monthly budget spreadsheet is a self built one that calculates the residual from my monthly salary after allocating for fixed expenses. That residual is then assigned to fluid monthly expenses and yearly expenses. Whatever is left goes into savings. I can flex any line item to reduce or increase savings depending on what kind of month I expect to have. As the spreadsheet fully breaks down every bill / direct debit and spending category, I can just have one 'bills' line item in YNAB, which keeps it nice and simple. I don't really need such a granular look at my fixed expenses these days. They are what they are.    

The other spreadsheet with various mortgage options is also self built, with similar principles to the above, so I can change the proposed monthly mortgage payment to see how little is left over for fun money.

I do love a good spreadsheet! 

Andyjflet

DrSpendingLittle said:

@Andyjflet My monthly budget spreadsheet is a self built one that calculates the residual from my monthly salary after allocating for fixed expenses. That residual is then assigned to fluid monthly expenses and yearly expenses. Whatever is left goes into savings. I can flex any line item to reduce or increase savings depending on what kind of month I expect to have. As the spreadsheet fully breaks down every bill / direct debit and spending category, I can just have one 'bills' line item in YNAB, which keeps it nice and simple. I don't really need such a granular look at my fixed expenses these days. They are what they are.    

The other spreadsheet with various mortgage options is also self built, with similar principles to the above, so I can change the proposed monthly mortgage payment to see how little is left over for fun money.

I do love a good spreadsheet! 

Me too, working for a bank as an analyst helps lol. Years ago before I did the debt free thing, I even built one that worked out my mileage and PCP etc, loved it. My main issue is that I calculate DD and leave the balance in one account, then pay myself some savings, then have a target budget for spends, which I always exceed and dip back into the over ambitious savings pot. 

DrSpendingLittle

Got a good amount of leg work done yesterday pulling together everything we needed to get a decision in principle for a mortgage. I did the DIP online and have a call booked in for this afternoon with a broker to follow up on some additional queries I have about term length. So, feeling fairly productive and organised in that regard. 

Had a few spends yesterday getting some lunch bits and bobs for the week seeing as DF and I are off work. I then went to TKM4XX in search for two specific items we need (one pan and one knife) and quickly found myself considering buying about 4 things because they were a good deal, rather than fitting our exact requirements. That old money spending mindset that got me into debt is still alive and kicking. Of course, I recognised what was happening and didn't go through with the purchases. They didn't have precisely what I was after so I left empty handed, which felt good and restrained. Even though I have been debt free for over 5 years, I still do get these old debt cognitions and urges to snap up a good deal, especially once the dopamine rush kicks it. It does still take mindfulness and discipline to resist.

I then had a bit of a revelation - I just don't have the time anymore to browse and search for potential bargains in places like TKM4XX like I used to before having LO. And I always found that browsing for bargains inevitably led to buying more than I needed and justifying it because it was a bargain. But the mindset shift to paying full price for fewer, higher quality items that are inevitably easier to find has been really quite hard for me. I've been a bargain hunter for many, many years, which ironically was because I couldn't actually afford what I was buying, let alone pay full price! Add in the fear of paying full price for an item only to find it go into sale shortly after - for some reason this really, really bothers me with clothing - that I've found the transition really hard. But, I'm just going to have to bite the bullet try for a few months to challenge this mindset. It's mainly around clothes, less so for household or other items.    

Today I'm in the process of tackling a few cupboards that need a good sort. I I'd planned to buy two really useful boxes (these are the best storage boxes and well worth the initial outlay) to finalise my clothes storage system but I've just checked and they won't fit in the space, argh! So I'll just stick with what I've got. Next up are the kitchen cupboards, which are an absolute state with no order at all. And I suspect there is quite a lot of outdated food at the back. 

Not a NSD as I ordered LO some t-shirts, vests, socks, shorts and PJ's from N3xt and some sippy cups / bottles and a little jigsaw puzzle from Am4zon.

Back to it!

DSL 

Sarahwithlove

I do love a good spreadsheet. 

Is there any way you could move closer to the parents to reduce the drive? If they are rural and becoming less able maybe they need to consider moving somewhere with better networks. 

DrSpendingLittle

Andyjflet said

Me too, working for a bank as an analyst helps lol. Years ago before I did the debt free thing, I even built one that worked out my mileage and PCP etc, loved it. My main issue is that I calculate DD and leave the balance in one account, then pay myself some savings, then have a target budget for spends, which I always exceed and dip back into the over ambitious savings pot. 

I've been doing that too - being probably a bit too over ambitious with savings targets and then dipping back into savings! I'll find a natural rhythm sooner or later I think!

DrSpendingLittle

Sarahwithlove said:

I do love a good spreadsheet. 

Is there any way you could move closer to the parents to reduce the drive? If they are rural and becoming less able maybe they need to consider moving somewhere with better networks. 

Hey Sarah, I was just catching up on reading your diary the other day! You're making great progress with your debt pay down, I think it's halved since the last time I was on the boards. Hope you're feeling better now. Frustrating to have been poorly when on leave! 

Yes I think the plan is for them to move into a home at some point in the near future, so that will be addressed. We just need to decide which sibling they will be closest too, though it probably won't be DF. They do have other family quite close by who can help on a day to day basis more than us. DF likes to help out when he can to reduce the burden on other family.

DrSpendingLittle

Quick check in whilst taking a short break from sorting. We had a fun day yesterday going out to the cinema and for a spot of lunch, to take advantage of our child free week. It was also good to have some down time, though I might need to take some money back out of savings as I had forgotten to budget for entertainment and didn't realise how expensive the cinema is nowadays! 

Finances are going fine, though I seem to have spent more than expected when compared to this time last month. Will have to keep an eye on spends for the rest of the month. Just a few more bills left to come out of billing account. I can't remember when I last had a NSD, so I should try to get back into the habit of that. I think spending the week sorting has led to me nipping out every day to pick up something I inevitably need.

On that note (!!) I do need to nip out later and get a few supplies in for the weekend, so it won't be a NSD today, plus I put fuel in the car this morning anyway. I have been putting off meal planning for the LO's dinners for a while but do need to spend some time selecting some new dishes and adding the ingredients to the list before I go out. We're in a bit of a rut with it all to be honest. He's getting bored of our tried and tested dinners so we need to come up with new exciting flavours and colours. It's just a bit disheartening when you plan, prep and cook a meal, only for him to refuse to eat it! But alas, that's what it's all about I suppose! We'll need come up with some new ideas and take it from there. I've subscribed to a toddler food app for some ideas, so hopefully that will provide some inspiration.   

DSL