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Plan B to being mortgage free

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Plan B to being mortgage free

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After reading many of the MFW diaries over the last few weeks I felt inspired to give it a go. Worst case scenario I don’t hit the target I’ve set but we’re further ahead than we would have been just making the monthly repayments, right?

At the start of the year we had a plan – clear our £104,675 mortgage (twenty six and a half years left) in three years. This should have been pretty straightforward – DH is self-employed and I work for him doing accounts and admin etc. We get paid the minimum we need to pay our day to day bills but usually get to take dividends of about £30,000 so between these and the monthly payments and some OPs the mortgage should have been cleared with relative ease and only a bit of belt tightening.

Fast forward to now and obviously the world is a very different place. We know we are very fortunate – I’ve been furloughed since March and at home with the kids (I’m looking forward to September!) and work has been plodding along nicely if a little quieter than normal for DH, fingers crossed this will continue.

Once this was cleared we would then look to either move house to our “dream home” or stay in the house we’re currently in until we downsize once the kids have left home.

Now we’re feeling that we should be more cautious and rather than throwing every penny at the mortgage keep something back just in case recession hits hard as essentially we’re a one income family. But at the time still trying to clear it as quickly as possible so we have more security for us as a family.

I’ve joined the July Grocery Challenge as we’re always seem spending a fortune on feeding the five of us. One good thing about lockdown has been less takeaways as everywhere shut – although you wouldn’t be able to tell from my waist line! Hopefully there’ll be some money left at the end of this month to either add to the savings or pay off the mortgage.

This week I increased the £150.00 OP to £151.15 to make the overall payment a nice round £600.

Now I’m off to read more diaries – at least it’s a healthy addiction!


Mortgage Balance June 2020 £102,824.39 Now £94,400.00
 Grocery Challenge  July £468.97/£500.00 August £137.55/£500.00
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Replies

  • LeighofMarLeighofMar Forumite
    326 posts
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    Welcome with your new diary. It is very smart to have a Plan B on any major decisions. Well done. And congrats on the great OP.
    Mortgage start date Dec 2015 - $64,655.00
    Mortgage end date Dec 2045 - NOT!!!!
    Mortgage balance end of July 2020 - $36,835.00
    Hope to be mortgage-free by 2023 
  • South_coastSouth_coast Forumite
    1.1K posts
    1,000 Posts Name Dropper Photogenic
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    Welcome and good luck! Would an offset mortgage or aiming for mortgage neutral (savings = mortgage) suit your circumstances better? That way you can still go at things just as intensely, but still have the money available for you to access if you really need it? 
  • BravingSavingBravingSaving Forumite
    37 posts
    10 Posts Name Dropper
    Hi @LeighofMar and @South_coast!
    Previously we've been in a take what we can get position with regards to the mortgage but we're due to remortgage in April so I will definitely look at the option of an offset mortgage - it never even occurred to me but could be a really good option thank you South_coast  :)

    Just checked the bank accounts and there's £23 left in our current account till payday on Friday but everything's paid - I'm hoping we can avoid the shops till pay day but the milks not looking like it will last that long. I think I'll try and find some change in the house to preserve that and be able to send it to the savings account.

    Mortgage Balance June 2020 £102,824.39 Now £94,400.00
     Grocery Challenge  July £468.97/£500.00 August £137.55/£500.00
  • LeighofMarLeighofMar Forumite
    326 posts
    100 Posts Name Dropper First Anniversary
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    "Just checked the bank accounts and there's £23 left in our current account till payday on Friday but everything's paid - I'm hoping we can avoid the shops till pay day but the milks not looking like it will last that long. I think I'll try and find some change in the house to preserve that and be able to send it to the savings account."

    Been there. I'm so glad to know that other people also have change jars for those moments when funds are running low and payday is a few days away. After barely surviving the Great Recession, I always keep a change jar as there were literally times when the money in that jar paid for our groceries when we had nothing else. Now, it's nice to have and build up so I can see it. Although I need a bigger jar but don't want to spend money on something to keep my money in  p if that makes any sense whatsoever. Best wishes to being able to sweep some money into the savings account. 
    Mortgage start date Dec 2015 - $64,655.00
    Mortgage end date Dec 2045 - NOT!!!!
    Mortgage balance end of July 2020 - $36,835.00
    Hope to be mortgage-free by 2023 
  • BravingSavingBravingSaving Forumite
    37 posts
    10 Posts Name Dropper
    Although I need a bigger jar but don't want to spend money on something to keep my money in  p if that makes any sense whatsoever. Best wishes to being able to sweep some money into the savings account. 
    @LeighofMar That makes absolute sense! I'd feel like I was wasting money on buying one. Our jar is one that had marshmallows in it that were a gift. I've covered it as well to avoid seeing how much is in there so we don't get tempted to dip into it too often. Other than milk we have plenty in the house so I'm hoping if we do pop to the shops we'll stay strong and not buy any extras - that's our biggest downfall :( 
    Mortgage Balance June 2020 £102,824.39 Now £94,400.00
     Grocery Challenge  July £468.97/£500.00 August £137.55/£500.00
  • edited 24 June at 9:46PM
    Tahlullah.HTahlullah.H Forumite
    243 posts
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    edited 24 June at 9:46PM
    I completely agree about the savings jars.  A few years ago, there was a trend for these beautifully painted pottery saving pots that you broke once they were full.  I couldn't join in the fun because I couldn't bring myself to pay £6 for something I was going to break later down the line.  How tight am I?
    I am another one who will vouch for an offset mortgage.  Not that I have any savings to offset, but I use it as what it is - which is an interest only mortgage.  Pay into in and overpay as you wish, but if you need to, you can draw down as much as you need of your overpayment up to the original amount borrowed.  Fantastically cheap way of borrowing.

    I have £5 until payday and am protecting it with everything I have, but luckily it is payday tomorrow - think it's early!


    This too will pass.
    Mortgage outstanding - 30/09/19 - £78,800. 31/10/19 - £73,100. 30/11/19 - £71,900. 31/12/19 - £70,700. 31/01/20 - £69,500. 29/02/20 - £67,250. 28/03/20 - £66,000. 09/04/20 - £64,750. 29/05/20 - £63,500. 30/06/20 - £62,250. 31/07/20 - £60,900. 06/08/20 - £59,900.

    August NSD Challenge - 4/20
    Make £10 per month - August £13.20
  • LeighofMarLeighofMar Forumite
    326 posts
    100 Posts Name Dropper First Anniversary
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    Ha ha, so glad I'm not the only one Braving and Tahlullah. We are not tight. We are savvy  ;) Somebody's got to have some old canning or mason jars around here that they're not using  :p It looks like we are all getting paid today or tomorrow too. I've ordered the groceries right at my budget, so I have to try to keep OH from going to the store to pick up odds and ends. 
    Mortgage start date Dec 2015 - $64,655.00
    Mortgage end date Dec 2045 - NOT!!!!
    Mortgage balance end of July 2020 - $36,835.00
    Hope to be mortgage-free by 2023 
  • ruby_eskimoruby_eskimo Forumite
    2.6K posts
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
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    Welcome to the mortgage free journey @BravingSaving I agree that its a difficult balance between paying off the mortgage and building some savings.  Hope you manage to strike the right balance.  My savings jar is an old tea canister that my mum was throwing away so think that's quite MSE if I do say so myself :wink:
    Emergency Fund - £2172.90 / £5,000 :: Mortgage OP -£732.84
    LISA 2020 - £1246 :: NSD August - 4 / 20 :: Weight Loss: 38.6 / 58lbs
    Engaged 9th December 2010 :: Married 29th October 2015 :: Bought a House 13th January 2017
  • BravingSavingBravingSaving Forumite
    37 posts
    10 Posts Name Dropper
    We are not tight. We are savvy  ;) 
    Absolutely!
    I managed to maintain the £23.91 so that got transferred to savings this morning. DH is currently doing the first shop of the month so I'm excited to update the grocery challenge totals (someone needs to get a life!) 😂
    @Talullah.h did you manage to keep your £5?
    Thanks @ruby_eskimo I've been reading and enjoying your diary 🙂
    Mortgage Balance June 2020 £102,824.39 Now £94,400.00
     Grocery Challenge  July £468.97/£500.00 August £137.55/£500.00
  • longway2golongway2go Forumite
    452 posts
    Part of the Furniture 100 Posts Name Dropper
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    Welcome to plan B, sounds like a good one. I think nearly everyone's plans have changed due to covid. 
    Good luck. 
    Mortgage Aug 2019 161,000 :eek::eek::eek:
    Nov 2019 156,500:T Jan 2020 153,122:T, Apr 2020 149,500 woop!! Now 146,700

    Our Mortgage is never going to be as high as it is today. :j
    Onwards and downwards to a better life for our family. :j
    Just keep swimming
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