The thriftyish way to debt freedom

thriftyish

Hello

We are a family of six (myself, husband, 10yo,9yo,7yo,5yo) living on DH's income at the moment. We went through a tough financial patch around 10 years ago and managed to clear all our debt, and then started paying down our mortgage - we had a mission to be mortgage-free before we were 40. Then we somehow got a little lost on the way we took out a £10'000 loan for a car, started spending on our credit cards and almost doubled our mortgage by moving to a bigger house last year. More recently it feels like we aren't making much progress but don't have anything to show for it either! - I am hoping this diary, and reading other diaries for ideas and inspiration will help keep me more focused.

Taking the loan out for the car was a really bad decision - partly because the car was overpriced, and ridiculously expensive to tax, repair and run. Earlier this year we swapped cars for something more economical. Our decision to move the house was the best move we made and we are really lucky. Our new house is a three-story Edwardian semi-detached, that needs a bit of work but the extra space is amazing and it means the children will have space to stay at home (if they choose / want/need to) well into early adulthood and hopefully give them the best start in life too - although at this point both myself and DH are dreaming of the peace and quiet! 

DH works in ICT and has just returned after furlough. My youngest started full-time school in September and I am on the lookout for a position that's term-time or self-employed. I am thinking of setting up a small web-design/graphic design business but all plans are currently on hold while I homeschool.

Our total unsecured debt is not huge and is around £3900. I think our day-to-day regular spends are okay. Our grocery bill is usually around £400 including cleaning products. I have just taken on an allotment in January and we are starting to see harvests now. We think 2 of our children have dietary issues, and we are trying to identify exactly what they are at the moment (with little support from our GPs who advised us to come back after covid) We have been given a chicken coop, and have borrowed an incubator and are in the process of incubating eggs to hopefully raise chickens. We bake/cook a lot from scratch too and I buy a mixture of new and second-hand clothes. DH hates dealing with money and so I handle the finances but we have the same goals and mindset

I've been meticulously keeping a spreadsheet since January of every penny spent which gives us a bit of an idea where we can cut back, but most of the things we have bought this year have been high-ticket investment things like a new fence, new drill, a supportive office chair for DH (he has back pain a since spinal operation) and a pair of ladders (I managed to decorate every room in our last house on my trusty chair, but our new ceilings are 3m tall and my chair just isn't cutting it!)  - most of this spending has gone on the credit card which is why it feels like we aren't progressing!

Our current plan is to overpay our debt ASAP so we can start overpaying the mortgage because our mortgage term had to be at the absolute maximum to be able to buy our new home... but the debt has to go first!

Hopefully this will be our last journey to debt freedom!

thriftyish

Statement of Affairs & Personal Balance Sheet

Summary

Monthly Budget Summary	Amount(£)
Total monthly income	2,725.16
Monthly expenses (incl. HP & secured loans)	2,396
Available for debt repayments	329.16
UNsecured debt repayments	204
Amount left after debt repayments	125.16

Personal Balance Sheet Summary	Amount(£)
Total Assets (things you own)	222,000
Total Secured & HP Debt	-158,866
Total Unsecured Debt	-3,922
Net Assets	59,212

Household Information

Number of adults in household	2
Number of children in household	4
Number of cars owned	1

Income, Expense, Debt & Asset Details

Income	Amount(£)
Total monthly income	2725.16

Expenses	Amount(£)
Mortgage	466
Secured/HP loan payments	0
Rent	0
Management charge (leasehold property)	0
Council tax	149
Electricity	40
Gas	48
Oil	0
Water Rates	34
Telephone (land line)	37
Mobile phone	35
TV Licence	0
Satellite/Cable TV	8
Internet services	0
Groceries etc.	400
Clothing	120
Petrol/diesel	100
Road tax	20
Car Insurance	30
Car maintenance (including MOT)	150
Car Parking	0
Other travel	0
Childcare/nursery	0
Other child related expenses	10
Medical (prescriptions, dentists, opticians etc.)	20
Pet Insurance/Vet bills	35
Buildings Insurance	28
Contents Insurance	0
Life Assurance	16
Other Insurance	0
Presents (birthday, christmas etc.)	150
Haircuts	0
Entertainment	0
Holiday	150
Emergency Fund	100
Allotment	50
House Maintenance	200
Total monthly expenses	2396

Secured & HP Debt Description	Debt(£)	Monthly(£)	APR(%)
Mortgage	158866	(466)	1.64
Secured & HP Debt totals	158866	-	-

Unsecured Debt Description	Debt(£)	Monthly(£)	APR(%)
Loan	3420	190	3.3
Credit Card	502	14	15
Unsecured Debt totals	3922	204	-

Asset Description	Value (£)
Cash	0
House Value (Gross)	220000
Shares and bonds	0
Car(s)	2000
Other assets (e.g. endowments, jewellery etc)	0
Total Assets	222000

thriftyish

A few things I should mention.
Mobile phone
Our mobile phone bill of £35 is for four contracts for myself, DH and 2 eldest children who used old phones predominantly as tablets and to keep in contact with friends / teachers during the pandemic. The data allows me to track them via GPS when they are at friends houses
Car and House
Our car and house budgets are quite high. We have a car savings account, and will hopefully use any extra money not used on maintenance towards a new car when it needs replacing - it won't be enough but its a start!
Our house is quite old and although it's okay at the moment, a roof/boiler repair could completely catch us off guard so we are hopefully going to let this account top-up after we have bought the basics to decorate the rooms this year. (Lining paper and paint this year, nothing swish!) In the next 5 years we will need a full rewire, and a new kitchen within 10 years, but the budgets don't reflect that just yet!
Allotment
The allotment budget is also high, but when I started this year I didn't even have a watering can or a wheelbarrow! My aim is to drop this budget dramatically from January to £10 to cover rent, seeds, compost, repairs etc - hopefully after I've found myself an eBay greenhouse!
Pet
Our pet budget of £35 also includes specialist food for our Labrador who has allergies and will need to include chicken food and accessories, so will probably see an increase - but its all a bit new and if we are honest we have no idea what to budget for that just yet!
Children
Because we have just moved house last November, the children stopped all their extra activities, and I didn't want them to pick any extra up until they were settled in a new school. The pandemic had other ideas this year! Ideally, I would like them all to have swimming lessons in the next year. I have just realised I have missed their pocket money off this list, which is usually around £20 a month between them which they get in exchange for helping around the house.

Mumoffourkids

Welcome to diary land. I would say your budget looks ok. Obviously if you get a job, you would have a bit more leeway to pay off your debts/save into house maintenance fund. 

I used to keep chickens, I used to feed them veg/fruit and then top up with pellets. I wouldn’t think your budget would have to increase loads in this area. But bear in mind if you are hatching your own, it will take a while to get any eggs and the chicks need to be kept under a heat lamp for a while.

Other than that, I’ll subscribe to follow you on your journey!

MagicCat

Hi @thriftyish you sound very on top of things! We also moved last year greatly increasing the mortgage, but like you it's so worth it in terms of space. I love the sound of your allotment and chicken plans, lovely for your children to be involved with. Good luck with it all 

Honeysucklelou2

It’s great fun hatching eggs and to see the chicks growth to adulthood. My children have loved  having chicks around in the  past. Are you hatching a particular breed?

Moneywhizz

Welcome to the diaries. You have got a good budget worked out there that looks realistic enough for you to stick to. There's not a lot of extra money to save for cars, house improvements but things have away of improving as time goes on, usually  by increasing income that naturally happens, There's a diary on Mortgage free board that you might want to have a look at. Sounds like a similar family/house circumstances and is very inspirational. I can't post a link but it is called 22 Foxhole East. It might give you some more thrifty ideas. 

thriftyish

Mumoffourkids said:

Welcome to diary land. I would say your budget looks ok. Obviously if you get a job, you would have a bit more leeway to pay off your debts/save into house maintenance fund. 

I used to keep chickens, I used to feed them veg/fruit and then top up with pellets. I wouldn’t think your budget would have to increase loads in this area. But bear in mind if you are hatching your own, it will take a while to get any eggs and the chicks need to be kept under a heat lamp for a while.

Other than that, I’ll subscribe to follow you on your journey!

Thanks mumoffourkids. I am hoping to feed them extras from our allotment and top up with pellets like you say. We are on day 8 of incubation and it's still early but we think 3 of the 6 eggs are doing okay. We are using our old dog crate for the brooder (with extra plastic/cardboard for the sides, but I still need to find out a cheap heat source. The couple who lent us the incubator recommended a standard 40w bulb, but I need to do some research and see if a red bulb or heat bulb would be better - and what the cost is like. I think the hens have to be about 20-21 weeks before we can expect any eggs, that takes us to early December so realistically we might not get any eggs until next year, unless we rescue some chickens in the meantime.

MagicCat said:

Hi @thriftyish you sound very on top of things! We also moved last year greatly increasing the mortgage, but like you it's so worth it in terms of space. I love the sound of your allotment and chicken plans, lovely for your children to be involved with. Good luck with it all 

Thanks for stopping by MagicCat. That's the main reason we are raising from chicks, I think it's such a good experience for the children. Its nice that they get to see where food comes from too at the allotment, their teachers are impressed by their plant knowledge!

Honeysucklelou2 said:

It’s great fun hatching eggs and to see the chicks growth to adulthood. My children have loved  having chicks around in the  past. Are you hatching a particular breed?

I have to admit, I am a bit clueless on breeds at the moment! We have chosen a set of mixed fertile eggs, so it will be interesting to see what we get and if we can tell what breeds they are. We have one blue egg that appears to be doing well and all my children want that one to be theirs!

Moneywhizz said:

Welcome to the diaries. You have got a good budget worked out there that looks realistic enough for you to stick to. There's not a lot of extra money to save for cars, house improvements but things have away of improving as time goes on, usually  by increasing income that naturally happens, There's a diary on Mortgage free board that you might want to have a look at. Sounds like a similar family/house circumstances and is very inspirational. I can't post a link but it is called 22 Foxhole East. It might give you some more thrifty ideas. 

Hi Moneywhizz, thank you very much for the recommendation, I spent a good hour today reading through Foxholes diary, and I am heading back later to say hi and read some more! We have been caught out before by not having a budget for cars/house improvements before and it's so disheartening when something comes along and offsets you. Last summer we didn't have any emergency budget at all, and our income was around £400 lower, I don't want to wish away the years, but it will be fab when the children are all in high school or college and I can return to full-time work.

I've decided I am going to pay this month £150 holiday budget off the credit card. I can't see us going on holiday until next year, and I don't feel safe going for day-trips just yet. We sold some things on fb last month and I found the cash (£85) today squirrelled away in the kitchen cupboard. I am going to pay that off the credit card too (before we spend it on takeaways- having money in the house is dangerous) meaning we should definitely be able to clear the credit card next month. 

We had Sunday dinner with homegrown potatoes today, a small saving but a saving all the same.  I am hoping we don't need to buy potatoes until around Christmas time if we can store the ones from the allotment safely. The main crop should be ready just after we have eaten all the early ones. We also had our first summer raspberries, only a few berries because the plants are new, but they were delicious and I definitely can't wait for next years harvest already. We always buy lots of fruit like bananas, apples & satsumas for the children but we rarely buy raspberries and strawberries because they are so expensive; it will be amazing to fill our freezers for pennies when the plants are established!

Honeysucklelou2

A blue egg - could be an arucana, beautiful birds.  I’ve used a heat pad when raising chicks . Brinsea do one that is reasonable. As the chickens grow, you can raise the level of the heat pad.

A good chunk of my allotment is given to growing soft fruit for the same reason. I find soft fruit so expensive in the shops, as we need a least a couple of packs of fruit, being a large family. It was a case of grow my own or go without, so we have gooseberries, blackcurrants and raspberries.

Bluegreen143

Hello @thriftyish! Thought I’d drop by and say hi as you had commented on mine. I’ve subscribed! Love the sound of your allotment and chickens. We have a big garden with greenhouse/veg patch/fruit bushes and it’s so much fun growing bits to eat. We are a long way from self sufficiency! Think we got three meals of potatoes in total (only grew earlier) but it’s still fun 🙂

We keep chickens too, have four currently, but have never done eggs, good luck for a successful hatch. We get point of lay pullets for £15 each from a local farm which has always worked out well for us. Four chickens gives us far more eggs than we can use and we end up giving some to our parents etc, but my family is smaller than yours!

Good luck on your debt busting journey and also on looking for a new opportunity once school restarts. I’m an at home mum too and my younger child is 18 months. It’s on my mind that at 3 when she gets her nursery hours I’ll need to think about retraining. It’s hard to get term time only work but I’d love that too.

Moneywhizz

Glad you enjoyed Foxholes diary. I think it a great example of how being at home actually can save you a lot of money. It is hard to find a job that fits in well with school hours and it is hard juggling work with looking after a home and family so making the most of being at home is sometimes the best thing to do. It already sounds like you are on that pathway with growing your own food, raising chickens and home decorating. Good luck with your df journey.