Cutting it Fine - the challenge is on!

SandyShores

*now to apply it to the rest of my life

Oh my goodness what a day today.  Our emergency fund project was on, then off and now its on again.  Things have changed rapidly in this house and then back again, but its made us really think about what we're doing and how we are currently saving and the family priorities.  

I started work on DH's website - Ftp, domain hosting, web builders, email hosting.  Who knew it was all so complicated.  Have managed to get the cost down to £100 per annum.  Just hope when it all goes live it works.  I could really do with some one on one training - I might have a look to see if someone could do it online.  Just an hour or two to go through how it all fits together.

One item ticked off the to do list today.  Tomorrow is a day to do some work on a presentation, and some house cleaning and a couple more to get ticked off the list.

savingholmes

Good luck with the website. I think it has got more complicated not less over the years.

SandyShores

Just popped into the weight loss thread.  Nice to be working towards my targets.  The weight loss isn't just about being slim - although I have to say its wonderful to be in those size 14s again.  Its very much about my health and fitness - there some are things I want to challenge myself to in life which require a better level of fitness, and I also want to make sure I stay healthy, so that I have the energy to achieve things financially and professionally and to be around for DD for as long as possible.  Its so easy as you get older to think that the best bits are behind you - its lovely to feel that life has the potential to be even better.

caeler

@SandyShores I hear what you are saying about being healthy.  I've always had to keep a close eye on my eating and exercise because if left to my own devices I'd eat too much of the wrong thing and never exercise but I really want to take my health more seriously as I don't want to develop any serious issues later in life, Covid has been a big wake up call.  For years now I generally eat low carb with a focus on eating loads of veg.  It works for me.  I took up couch to 5K in 2019 and haven't looked back! 

SandyShores

@caeler, I did the couch to 5k too, quite a while ago.  I've been dipping in and out of running for a while, but lockdown got me running three times a week.  Stopping lockdown gave me a bit of an excuse to break the habit, but I did get back into it after a few weeks.  Going into these tiers has scuppered me again and now I've developed a bit of back pain.  I know the physio will sort me out, but once I'm back to health and running I'm not going to stop this time   I started using hand weights in the last lockdown too, I'm not sure what happened - so I need to get back to that again too.

@savingholmes, I really hope the website works when the plan switches over.  I've got a backup plan if it doesn't, but it would I'm hoping to be able to learn website building later in the year when I should have some more time.

Its been a stressful week again, our plans were on, off, on again and now they are temporarily off, although part of them is going ahead.  It means that some of the materials we ordered need to go back - another task to do. DD has had a stressful week too - making plans and other things going on.  I think its hard for the youngsters in this virtually locked down world and it all adds to everyone's stress when you are supporting them.  But, we've finished the week on a positive, and all know where we are at, and where we are going (for now).

SandyCat is still getting used to living in a slightly more built up area.  He's very nervous to go far but is obviously missing his hunting pastures.  We've got lots of toys though, and I am sure once the summer comes he'll enjoy going out in our garden a bit more, especially when we are out there.

Some money things have happened this week and I will do a new signature soon.  Its nothing ultimately negative, just helping out DD has meant a few figures changing around.  Its all a net benefit for our little family, so I feel comfortable with it and in control (unlike a few years ago).  I do need to be careful though, that being comfortable doesn't mean going back to old spending habits.

Right, off to return those things - have a great weekend everybody.

SandyShores

Well, only a day has gone by and the plans are back on again!  At least it means I don't have to return the materials so I can tick that off the list.  I know the expense will definitely be worth it as it will create a little space just for me.  The only negative is money being diverted from the mortgage overpayments, but it feels like the right thing to do.

My back is feeling so much better and I am planning to get back to running this week, especially after reading about how exercise has a huge positive effect on us and my weight is gradually creeping up again.  I also need to think about that second income stream, something that I don't have to travel for preferably, and maybe something interesting that I utilise my new space for.

SandyShores

I've been missing a week and there's not much to report on my signature except a £1 increase on the xmas saver.  I think we are all feeling in limbo at the moment.  We've decided to go ahead with the home project, which will give us more space and give me a dedicated space (which I've always wanted).  I'm slightly nervous because its money which otherwise would go to overpaying the mortgage, but you do have to re-think things in these odd times.  Also, this is something we will enjoy for the next 10 years at least, so in my mind this is worth it.  As per my favourite book I need to stop worrying about it, as I've thought it to death and we are going ahead.  I thought about it in terms of should we have bought a bigger house, but actually another bedroom would have cost around £30k, whereas this will cost around £3.5k.

I was just looking at the 'how much do you need to live on' thread related to pension income.  Someone has offered up a few  figures between £17k, £20k and £40k - these are for a single person and £40k is for the luxury lifestyle.  I'm definitely not expecting the luxury lifestyle, so anything above £17k is a bonus.  If we didn't have the mortgage, our living expenses would be around £750 a month for the two of us so our state pensions would more than support us in our usual lifestyle.  I have a small council pension of around £3k per annum which I took early.  Mr Shores' private pension he's paying into might be around £3k as well, but that depends on whether we draw it down to pay the mortgage off.  This is something we need to get our heads around.  I'm also paying into a final salary pension which I plan to take when the lump sump will pay off the remaining mortgage - probably at 67 or 68.  It should also provide a pension income roughly equivalent to the state pension as well.  Mr Shores' work-based pension might also provide around £3k when he retires but I've not really looked into that at the moment as its fairly new.  So our pension set up isn't the best, but it would give us a good standard of living, even if we had to make some mortgage payments into retirement - that isn't the plan, but its nice to have that cushion.  I think where it becomes more difficult to work out is where you can't work later in life, or you lose one of you.  I guess if the worst happens we could sell up and move somewhere smaller.  Its really got me thinking and I need to do some more work on the various scenarios as it does provide some reassurance.  I think I would be okay, because I'd have my state pension and my final salary pension and my small council pension.  So it would be about £20k less tax.  Mr Shores would have my two survivors pensions (about £5k), and he would be able to draw on his work pension and eventually his state pension so he should be in a similar position if the worst happened.

It all means that we need to stay healthy, get fit and make sure we keep our earning power to pay off this mortgage as quickly as possible.  I don't regret deciding on this home project, because it will be great for my mental health and Mr Shores will benefit from that too.  I'm just so keen to get on with paying big lump sums off the mortgage.  As I said earlier, I need a second income stream which I might be able to use my new space for as well so its a win win win situation

savingholmes

Good luck with your plans and generating more income. It is always interesting to read different pension scenarios. I think you do need to remember that if either of you goes above the tax threshold you will need to allow some money for tax too - so what you need to bring in could be slightly more - particularly if your pensions are unbalanced - like ours are (ie one person has more in pensions than the other).

SandyShores

Had to just pop back in to give an update on my mortgage.  As my interest is calculated daily, my balance increases each day over the course of the month.  I'd worked out that I needed to overpay around £100 in order to end up with 000's at the month end - and I did that at the start of Jan/end Dec.  Well, I've just checked in and I'd actually overpaid by .85p, so although I don't see all the zeros, it means that £1k (plus .85p) has been paid off the capital this month.  Good to know my calculations were correct.   Somehow, between now and the end of Feb, I need to make another £99 overpayments, in fact, let's push the boat out and make it £100     I've a few things to sell, so I need to get on with some socially distanced selling.

Edit - if I make it £100 every month, plus I'm planning to start £1k overpayments from October, I will have made my £4k overpayment target by the year end.

SandyShores

savingholmes said:

Good luck with your plans and generating more income. It is always interesting to read different pension scenarios. I think you do need to remember that if either of you goes above the tax threshold you will need to allow some money for tax too - so what you need to bring in could be slightly more - particularly if your pensions are unbalanced - like ours are (ie one person has more in pensions than the other).

Thanks @savingholmes.  So its definitely better to pay off your mortgage before retiring.  Otherwise you are having to earn money to make your mortgage payments and its costing you more because you are having to pay tax on the money you earn.  Whereas if your mortgage is paid off you can earn less if you want to.   That kind of makes sense to me - I'm thinking I can take my pension and may pay tax on some of it, then if I need to boost my income with some part-time work it doesn't matter if its taxed as it will just be extra income (or not if I decide not to do it).  It makes sense to me, but I'm not sure if I've explained it properly.  I'm also thinking about lump sums - which aren't taxed, but pension income, which is.  So I'm definitely leaning towards larger lump sums to pay the mortgage off.  I feel like I have a little more grip on understanding of it all now.