Crunchy pays off the loan early, and other stories

Honeysucklelou2

I like the idea of asking daily what can be done to bring the debt down. Will use that idea!

ohdearhowdidthathappen

Love an SOA!  Yours looks good   At first glance, groceries look high (not that i can talk!).  Also, life insurance, we pay £35pm total for £350K cover.  
Like how holidays are non negotiable in your budget, I need to ring fence ours.  Often they're what take the hit in our house as too easy to see as luxuries and I don't think that's actually a good thing.

crunchy_time

I should clarify that the life insurance is also critical Illness cover. The holiday money also pays for days out like entrances for the zoo the other day but not food etc when we are anywhere.
I agree that they should be ringfenced. Ours has been dipped into in the past which hasn’t made us happy at all in the long run.
I haven’t included doing up the house in this SOA as we are doing it as and when but I’m getting to the point now that I want to put a figure on it and an end date to it so we can start chucking extra money at the debt. It’s that or take the scenic route with it all and start contributing more to pensions and savings now so that when we do finally pay off the debt, we can overpay the mortgage.
Is it better to do little bits of all of it now or focus on one thing and then another a la Dave Ramsey?

enthusiasticsaver

I think the problem with the scenic route with debt is that it never seem to get paid off as something else always takes priority and that leaves people vulnerable if something happens like a job loss, illness or even retirement. It also costs more to repay it if over a long time. I agree if you know you have to have holidays you should ringfence the money or it will end up on credit. 

Your car loan is a lower interest rate than that consolidation loan so it will be more expensive if you move the £365 to the car instead. I am not sure how old the car is you have just bought but it will probably last more than 5 years. When is the consolidation loan due to be paid off? 

enthusiasticsaver

Sorry I did not really answer your question. I would normally say that I think  focusing on repaying the debt first is the best option certainly before overpaying on pensions or saving beyond an EF or overpaying the mortgage. That saves you money in interest and you then get your disposable income up to do more things as you are not having to repay debt.

Personally I would choose that over the holidays, cars  and home improvements too but that is  a personal choice. The car loan could possibly be left until after essential home works had been done though. I thought your house was a new build? 

crunchy_time

Thanks for replying ES!
Yes, our house is a new build but coming up for three years old.  Retiling the bathrooms is the only renovation type thing we are doing although the whole house is rendered and needs repainting which is costing us a lot.  Other than that it is redecorating and a whole lot of landscaping in the garden.  Personally I am not prepared to sit and wait until I have paid off my debt to make my home nice and none of what we are doing is extravagant, it is to make it function for us.
When we have paid off the £365 a month loan, that money isn't going to be disposable income.  It will be swallowed up into mortgage payments/savings and pensions.  We have roughly £500 a month after all our bills which goes on debt repayments or stuff for the house or arguably a new car.

Both of our loans are just bank loans and I have a spreadsheet which tells me what is on each.  At the moment the smaller loan is in my name which we are calling the car loan.  The larger loan is in husbands name and has on it the following:
£450 for a vet bill 
£4744 for stuff we put on cc the year I was unemployed and failed to start a business.
£2800 for my course fees for said failed business
£2200 - summer 2019 overspends.
£1453 - winter 2020 overspends
£5000 - house move stuff - turf, tiles, boards for loft, extra insulation, a few pieces of essential furniture, curtains from when we moved three years ago.
I could transfer all of this except the stuff for the house onto my loan in my head and be paying this off at at £181 a month plush the extra slushing I do whilst the £365 pays off the car quicker.  They have already calculated the interest on this as £3554 over the five years and if I pay it off early, this will reduce of course.
Paying off the car over three years rather than 5 is more agreeable to me but I think I will wait until this summer is over before I start moving things around in my head again.

crunchy_time

Just checked our joint account and our BT bill is £11 less than I budgeted for.  Unexpected money!  Slushed towards the loan.
What am I going to do today to help us financially?  Insist my husband doesn't go to the shops today to get bits of lunch and we eat up what is in the house.
Crunch x

crunchy_time

Afternoon all!
We didn't (ok, well I didn't) get as much done as I had hoped to this weekend.  I think my body just crashed after months of trying to do my job to a good standard whilst also being solely responsible for homeschooling the children and taking care of the house.  Husband has been so busy at work (which is good) but hasn't been able to help out and it can get quite exhausting.  I'm so glad there is only this week left for me and then that is it.  I shall keep on top of emails but I won't have to do anything too taxing until the last week of August.
I get paid on Friday.  Just checked my online payslip and its £1138 per month - just shy of the £1150 I calculated.
Hopefully I will get my P45 soon so I can get my rebate.  We need it to pay for the house painting.  
I think my body is craving rest as much as possible this week so I'm not going to pressure myself to get lots of stuff done this week.  Wellbeing above everything else at the moment.
We did a sains online order this weekend and although it is of course more expensive than A L D I, it was bliss just spending 20 mins doing it online and then only having to pack it away when it arrived.  The available slots are so sporadic at the moment I have one booked for Thursday so I 'm going to have to meal plan early this week.
Right - must get on with dinner.  
Crunchy xx

crunchy_time

Morning all
I've finished work for the summer.  The children finish tomorrow and then six weeks of holiday!  I used to dread the holidays in a way - trying to find things to do to entertain them but also save money and keep sane.  But after 4 months of being together 24/7 and juggling homeschooling and work - this year it is going to be a breeze!! Ha ha!!
We are off on a UK cottage holiday in a couple of weeks and I am also going to be doing some homeschooling.  We dropped the topic work as I just couldn't do everything so I will pick this up - it will be entertaining and fun for them!!
Husband has cracked on with the bathroom this weekend. Honestly, the job the builders did was shoddy so I am pleased that we are doing it again otherwise there would have been a leak somewhere at some point.  Husband has everything he needs to complete it now so it's just a case of doing it.  
A couple of pieces of good news.  Husband's company has lifted its pay freeze that it installed in March at the beginning of the pandemic.  The company has done well over the last few months despite the issues.  July is when husband normally gets a payrise but we haven't heard yet what, if anything, it might be.  He gets paid next Friday so if don't know before then we will know on that day!  The other piece of good news is my P45 has finally come through so I shall send it off to my new employer today.  I'm expecting at least £600 of tax back so hopefully, that will come into my August pay packet and will go towards paying the house painter.  We have £600 so far and the estimate was for £1850 and he is coming in a couple of weeks.  I really don't want to dip too deeply into our savings account if I can help it but what I take I will replace.
Our food money has gone with one more shop to do before the month is out and we go on holiday so we are having an eat up week and I shall be careful with what I buy.
Because we have the decorator to pay I think big overpayments towards the loan will cease for the time being.  I will continue to make mini payments of extra money where I find it.  Our monzo roundup account has £10 in it so I shall transfer that over when I get a chance.  I will also do a round up of our accounts at the end of the month next week.  I was using the swimming money to chuck towards the debt.  However, that is astarted up again which is a good thing - £61 a month.
One thing I have learned during lockdown is how much I enjoy the little things in life.  I much prefer a good book and an early night over dinners out.  Not that I did this loads before but I think I felt I had to keep up appearances.  Husband and I have both discussed how we intend to change the way we socialise going forward - less boozing and more meaningful stuff.  We are going away with friends and I have a sweary game for adults saved on my amazon wish list.  It's £25 and I am reluctant to buy it now.  I just don't want to waste that money anymore on something I might play once or twice this year.  Husband and I have also said that we shall avoid eating out with the kids now and just keep a pizza or something in the freezer for those tired nights when you can't be bothered to cook.  £10 vs about £60.  We are going to save eating out for special occasions.
I'm still working on my organisation project that I think I mentioned a few weeks back.  My goal is to get so organised this holiday with a plan and a budget to finish the house, savings, pensions, mortgage (up for renewal in the autumn), Christmas etc etc.
Anyway,  that is where we are!
have a lovely day!
Crunchy x

crunchy_time

£10 taken out of round up account and transferred to loan bringing it down to £16,625 and total overpayment of £453.
Every little helps!
Crunch x