Quest for (mortgage) freedom

eat_that_frog

Well as we enter Autumn, thought I would provide an update. We had a great summer! The school holidays passed by in a flash, our eldest is back at school now and seems to be enjoying it! We had a couple of lovely family holidays which were so much fun. It was wonderful having our 4 year old around all the time at home for 6 weeks, felt quite emotional sending him back to school  !

My OH was promoted back in June and received a payrise, so we've got another net £300 or so a month coming in to the household coffers. So with a bit of additional financial security behind us, we took the decision to reduce our emergency fund from £20k to £10k, and use the £10k to make an overpayment on the mortgage. My OH and I are both quite risk averse when it comes to money, and had boosted our emergency fund to £20k last year deliberately...but then we sat down this week to discuss our mortgage overpayments and we both agreed that we were holding £10k more than we needed to, and to chuck it at the mortgage instead. It's a risk but hopefully it'll pay off.

I feel really fortunate that we are both on the same page about living somewhat frugally and paying off the mortgage as quickly as possible. Like me, he's just really keen now to get the mortgage balance down to £0. Anyway, our outstanding mortgage balance is now around £65k.

Still feels a long way to go.

South_coast

Ahh, the old "So near, but yet so far" feeling! It will always feel like a lot, right up until the very end. You have however paid off 75% of your original mortgage in 5.5 years, which is freaking amazing - so do try to hold on to that! Extra bonus points for managing it while maintaining family fun (and your sanity) as well 😀 

eat_that_frog

Yeah that's exactly what it is! We are getting closer and yet it seems to be feeling harder

My OH and I were talking the other day about when would we feel comfortable with the mortgage. I genuinely don't think I'll feel comfortable until it's completely cleared. Because even when we do get it down to like £20k or £10k, then I'll be feeling really impatient to get it to zero!

eat_that_frog

We're trying to squeeze every penny we can out of our budget to try and free up 'spare' cash to try and get our mortgage down further. But October's always a busy month as the car needs its servicing and MOT done - the car is 9 years old and has done us wonderfully well *touches wood frantically* but there's always something needs doing. Also our food shopping seems to be increasing again. We're trying to be a bit more frugal, switching down to the Essentials range for over 75% of our shopping list, still spending around £80 a week. But then I saw a review for something which now costs 86p but back in 2022 cost 45p, and I remember that prices have changed. The days of spending £40 - £50 and getting a not extravagant but a decent weekly shop for that are long gone. Grrrrr. I'm sure it felt like a few months ago food shopping was starting to coming down a little bit, not massively so but a bit? Maybe I imagined that!

KajiKita

I think food shopping stopped increasing by such a rate rather than dropping much (though I read some things were dropping - can’t remember what though as it didn’t help us much 😉🤷‍♀️).

KK

South_coast

Lidl mushy peas are down 4p per can (still 9p up on where they started though) - but even I can't live on those full-time 🤣!

eat_that_frog

I've done something I have never done before: sat down and drawn up a really detailed, line by line budget.

My previous budgeting technique was a bit too vague I think (think 1 line item for 'entertainment'). I'm hopeful that this one will give me more clarity on where the money's going and where things can be trimmed back. In fact I'm already starting to feel a bit more in control of my money and I'm only 2 weeks into using my new budget tool.

And not that I want to shame myself in any way but I've looked at the Food and Household Supplies section of my budget, set up using last month's spend as a starting point, and my jaw is genuinely on the floor at the amount we've been spending and frankly wasting. I spent £690 in October. I'd always thought of us as being quite frugal as a household but there is definitely lots of fat to be trimmed here. I reckon I can get my monthly spend down from £690 to £500 just by cutting back on 'nipping into town to buy milk' (inevitably I always end up getting more than just milk), meal planning a bit smarter, and setting myself no spend days so that I'm not tempted by something when out and about. 

eat_that_frog

Time for my annual review against my goals for the year....

Can't believe we're nearly at Christmas already! I don't really know where 2024's gone, I swear time is accelerating. We've had a very good year and after the difficulties we faced in 2023, I feel hugely grateful for that.

Looking back at my 2024 goals, I think on the whole I've met most of them. I decided in 2024 to focus a bit less on the financial goals and took more of a holistic approach, as we'd had quite a challenging second half of 2023 as a family. So 2024 was a chance to reset things in a positive way, and I think we met most of those goals:

- We've got better as a family at eating more healthily. I'm much more conscious of UPF consumption within our household and we're doing better at reducing this now. 
- We've been enjoying doing at least 1 or 2 (and most weekends at least 3) activities a weekend as a family. Swimming, running, family walks with the dog, bike rides... It has been so much fun and worthwhile, and apart from our Saturday morning treat of going to a cafe for coffee and a cake whilst reading/colouring/doing puzzles with our 5 year old, it's been inexpensive too!
- I didn't quite meet the 5 x a week physical activity goal but I got pretty close, and it was definitely an improvement on previous years. I feel much better for it, too.
- Ongoing decluttering. As we've done so much of this over the last 3 years, it's much easier now to keep on top of by just doing the odd drawer/shelf now and again, almost like a maintenance exercise.
- We very much exceeded our mortgage OP goal of £6k. This is mainly because my OH and I got better than expected bonuses at the end of the financial year and we also took the plunge and put some of our savings towards the mortgage, as we felt we were holding too much in our emergency fund. We started the year with the mortgage at £88k and end it at just over £55k.
- We've kept our emergency fund at £10k, as we aimed to do.

Hope everyone has a Happy Christmas and a peaceful and positive New Year

South_coast

A fantastic year 👍! Looking forward to seeing what you do in 2025

KajiKita

To reduce your mortgage by £33K and maintain a £10K EF is epic! Well done 👏 😊🤩

All the other successes are very positive too. Sounds like you got the rebalance you were aiming for at the end of 2023. 

KK