Quest for (mortgage) freedom

eat_that_frog

I'm a long-time reader of this forum, I find other peoples MFW diaries really interesting and inspiring. Now it's time to do a MFW diary of my own and hold myself to account.

OH and I bought a house in February 2019. We've spent around a year making cosmetic improvements (lick of paint, new carpets etc) as well as some bigger (and expensive) much-needed improvements to bring it up-to-date, like new boiler, insulation, new bathroom, woodburner etc. 

We've got £240,089 left on our mortgage, with just under 24 years to run on it. We have no other debts (no credit cards, overdrafts etc). We have an EF of £15,000 and I'm not looking to increase or decrease it as we're comfortable with that amount. We own the car outright. We both have jobs which seem secure at the moment (touches wood furiously). But just in case something did happen to one or both of our jobs, we don't want to have such a large mortgage debt hanging over our head. So we are now turning our attention to getting our mortgage down. I look after our finances, OH lets me get on with it - like me he's cautious with money and is a saver, not a spender. 

At the same time we haven't really done anything with the garden since moving in, other than regularly mowing the lawn, so we're going to get on and get that looking pretty and tidy for as little as we can.

Plan of action
1. Compile budget to understand where the money goes
2. Use budget to decide what can be cut back and where
3. Swap energy suppliers and get best deal; use money saved to OP mortgage. We swapped energy supplier when we moved into this house in Feb 2019 and found the best deal then at the time, so it's time to look again at the best deals.
4. Look at food shopping savings. That seems to be a large chunk of our monthly budget, even though we already shop at the discount supermarkets.
5. Decluttering house, selling decent items no longer wanted on various online selling sites

eat_that_frog

So I did an SoA to understand where things stand, and we have around £2,300 a month left over after outgoings in our monthly budgets. So I should be able to meet my goal of £10k OP against the mortgage by Dec this year if I try and OP £2k each month.

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]

Number of adults in household........... 2

Number of children in household......... 1

Number of cars owned.................... 1[b]

Monthly Income Details[/b]

Monthly income after tax................ 1800

Partners monthly income after tax....... 2700

Benefits................................ 80

Other income............................ 0[b]

Total monthly income.................... 4580[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 1030

Secured/HP loan repayments.............. 0

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 232.5

Electricity............................. 100

Gas..................................... 0

Oil..................................... 150

Water rates............................. 30

Telephone (land line)................... 0

Mobile phone............................ 40

TV Licence.............................. 5

Satellite/Cable TV...................... 40

Internet Services....................... 7

Groceries etc. ......................... 200

Clothing................................ 10

Petrol/diesel........................... 50

Road tax................................ 0

Car Insurance........................... 30

Car maintenance (including MOT)......... 30

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 80

Medical (prescriptions, dentist etc).... 0

Pet insurance/vet bills................. 10

Buildings insurance..................... 30

Contents insurance...................... 30

Life assurance ......................... 70

Other insurance......................... 0

Presents (birthday, christmas etc)...... 10

Haircuts................................ 0

Entertainment........................... 10

Holiday................................. 0

Emergency fund.......................... 0[b]

Total monthly expenses.................. 2194.5[/b]

[b]

Secured & HP Debts[/b]

Description....................Debt......Monthly...APR

Mortgage...................... 240089...(1030).....1.9[b]

Total secured & HP debts...... 240089....-.........-   [/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR[b]

Total unsecured debts..........0.........0.........-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 4,580

Expenses (including HP & secured debts). 2,194.5

Available for debt repayments........... 2,385.5

Monthly UNsecured debt repayments....... 0[b]

Amount left after debt repayments....... 2,385.5[/b]

[i]Created using the SOA calculator at www.stoozing.com. 

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

DiscountDuck

Happy new diary! I just wanted to wish you all the best in your mfw journey. 

inigma

Good luck, I started off in September 2011 and I am desperate to be finished by September next year. Just remember the difference between your net income and your net outgoing is going to be the quickest way to freedom.
Don't let it get too daunting, set mini goals and rewards for obtaining them.  Sometimes you can face 100 balls to get 10 runs other times you will be smashing everything for 6.
Good luck you can do this. 

Squirrelz92

Happy new MF diary! Looking forward to reading your progress! £10k overpayment for 2020 seems a very achievable amount with the amount of disposable income you both have after bills Good luck!

eat_that_frog

I've had quite a good week this week, spending wise. I've not bought anything other than food shopping and fuel for car. When I've taken my son out for day trips, they've been to free places (woodland walks, picnics by the river) or playdates in friends gardens. We've taken packed lunches with us too reduce the temptation to spend.

Out of these Coronavirus times, what I've realised is that our supermarket food shopping spend has gone up, but that's because we're not eating or drinking out (plus we live in the country so no takeaways or deliveries to tempt us). Overall though we are definitely saving money on food and drink - because me and my husband are both working from home, it completely reduces the temptation to buy coffees out and about, or lunches on the go, or drinks after work.

Spending so far this week:
£20 fuel
£110 food shop to last 14 days

eat_that_frog

I calculated what the daily interest is on my mortgage...gulp! £12.50 a day   !!!  Or £387.50 in a typical 31 day month  ... If that's not incentive to get on and overpay, I'm not sure what is.

Our first payday is tomorrow (favourite time of the month!!!  ) so planning to make first overpayment tomorrow. Never made an overpayment before so will phone the building society tomorrow and experience it for the first time.

Had a pleasant surprise yesterday, opened the post to find a cheque for £30 from family, they'd missed my birthday earlier in year due to coronavirus and wanted to give me something, very kind of them.

Hazelnutty

Welcome (and great username!)

eat_that_frog

Today was most definitely not a no-spend day. I spent around £100 on various things we've been waiting until payday to buy or pay for. And it's payday for my husband today woohoo   

Annoyed at myself for not taking a packed lunch with me, I ended up buying sandwiches whilst out and about. Determined not to make that mistake again, I need to be more organised.

As it's payday today, going to look at accounts tonight and work out how much I can move to overpay mortgage and get the ball rolling!

eat_that_frog

A good day today, I made my first overpayment on the mortgage!
I waited until the end of the month after all bills and DDs had been taken out of our wages, so we were able to OP by £1,500. Having made the regular monthly payment of around £1k, this brought the total down from c.£240k down to c.£237.5k. Getting down below the 240 mark has been a real psychological boost, as we now don't look that far away from £235k.

I can see these overpayments becoming addictive 

LeighofMar

What a terrific OP. Every little milestone does so much for us psychologically once we get going, doesn't it?