Lolu's Mortgage Free odyssey

misslolu

Thank you @powerspowers . I must admit, I definitely underestimated how hard the stage after a newborn would be! Little madam started crawling properly at 5 months and has been a hurricane ever since. It's been a lovely time, though; she's grown so much and has become much more interactive. She's started weaning and loves to eat; we have to hide food from her (that she can't eat), otherwise she sits on us till it goes in her mouth. All in all, while I love her to bits, it's reinforced my decision to go back to work. I definitely don't have enough energy for her all day, especially as she's not yet sleeping through the night. I've spoken to my manager about dates, and very likely it's early August that my back-to-work transition starts, which seems awfully close. Just 3 months more at home with my little one, it's so bittersweet.

In other news, I've had a family member come stay with us for the past 5/6 weeks that's been "interesting". On one hand, having even an hour's break from DD has meant I get so many more chores done. I've been able to declutter another 4 bags for charity & 3 for recycling. Does my house look different? Yes, however, a lot less than expected, but I'm on a roll now, and the more that gets decluttered, the more space I'll have for the stuff currently in the way. On the other hand, the family member is definitely deficient in other ways which don't help my decluttering tasks & actually cause more work for me. They're going this week, so I'm hoping to be able to declutter the room they're staying in when they're gone.

Having less help will slow me down, but I've ordered the decluttering in a way that I should be able to let DD play independently while still keeping an eye on her. Ideally, i'd get everything done by the end of June so I can focus on planning DD's first birthday! I'd thought about having one at home, but the flat is a bit small imo. So we're planning to have it in a hall. I've started looking at venues & am planning food & entertainment too. Ideally it wouldn't cost too much, maybe £1k tops but it would be a lovely way to celebrate with friends & family.

In other finance news…I have to hang my head in shame as the debt has gone up again. However, this is for good reason. I'm currently on maternity leave and have been on less than full pay since December. This has obviously meant a reduction in the amount going to debt. In fact, when I went down to SMP, we had to strip back to the bare minimum, as that's all we can afford. In addition, we've had 2 lots of service charge plus some hefty visa fees to pay, which is the real cause of the increase. Also, due to some 0% interest periods ending, we've had to balance transfer, so the cards are a bit jumbled up luckily no interest to pay though. A look at the damage:

CC1 (Mine) - 5,299 4,499
CC2 (Ours) - 7,126 10,737
CC3 (His) - 753 360

CC4 (His) - 0 2500

Total Non - Mortgage Debt - 12,492 18,096

S&S LISA - 15,348 17,716
Premium Bonds - 10,000 10,275
Personal Savings - 10,000 8,932
Joint Savings - 1,600

In saying that, its frustrating to take a few steps back before going forward, and while these are some of the most unavoidable costs ever, it just hurts that much more because they're so expensive. And until I get back to work we're reliant on OH's salary. In fact, at the moment, we're taking out more than we're putting in. The big saving grace is that we were able to get some savings in before DD came as well as the bonus. Without those, id have had to go back to work already, or maybe we'd be actively increasing the debt.

*Sigh* the joys of motherhood.

South_coast

With the debts increasing and DD's birthday being in the summer, why not have a picnic in a park for her party? I'm sure everyone will understand if you keep it low-key due to being on SMP

misslolu

You know what @South_coast thats a great idea!! And we have some huge parks really close by that would fit the bill. I'll float that idea and see how it works logistically.

misslolu

Payday is not for a few days, so not much progress on debt at the moment. It's sad because I almost can't wait to go back to work just so we aren't so poor, and these aren't even the hard times. At the end of June I get just a week's SMP as the last payment, then in July I get absolutely nothing. Then from August I get at least half pay, so we're back to some semblance of usual programming. That's also when DD starts nursery, so fees will need to start coming out.

OH is in a few interview processes, so fingers crossed we get some good news soon. That, however, brings up a new can of worms because our current plan for childcare relies on his random shifts, so it may mean we need to up childcare when I go back to full-time next year.

CC1 (Mine) -  4,499 4,287

CC2 (Ours) -  10,737 11,037

CC3 (His) -  360 227

CC4 (His) - 0 2500

Total Non - Mortgage Debt - 12,492 18,096

S&S LISA - 15,348 17,716

Premium Bonds - 10,000 10,275

Personal Savings - 10,000 8,932

Joint Savings - 1,600

While I'm not earning, I'm trying to be more serious about finding little ways to make bits of cash. I was slacking on surveys till I saw someone say they're making £100+ a day!! While DD keeps me too occupied for that, even £10 a day gets me in a really good position, so I'm back on board for the foreseeable future.

Another of my cards' 0% interest periods ends in a few months, so i'm going to need to jiggle things around again. I'm planning to pay the first of OH's cards off this month but will then need to BT from CC1 to another of my cards with a lifetime 6% APR and some to CC2, which still has a bit of room on it; for easy understanding, this will remain CC1 even though it's a different card. Obviously, even though 6% is low, paying any interest at all isn't great, so this will become the focus of our debt busting. While I'm still on mat leave, we're only paying a set amount to each card, but going down from 4 to 3 cards means fewer minimums and allows us to direct our focus onto one card. I'll be putting survey money fully to CC1 to help bring that down but realistically it's only about £50 a month. It's nothing to sniff at, but it doesn't help bring the amount down quickly enough for my liking, haha.

I've been speaking to my boss, and it looks like I'll be going back to work in less than 8 weeks. I've bulked up a lot due to breastfeeding, and a lot of my clothes don't fit which has been an eye-opener. Apart from the fact that I don't really have spare cash to go shopping, I'd like to go back to my pre-pregnancy weight so I don't have to expand my wardrobe any further. It's bittersweet because while I've adored spending time with Baby Lolu, she's an absolute handful, and I don't often get a break from her due to OH's shifts. It's meant I'm quite exhausted most days and don't sleep very well. Having her at nursery, especially on my work from home days, means there's a good 45 minutes in between drop-off & pick-up times as well as my lunch hour that I can get admin or some chores done quietly. Ideally that should stop the house looking so much like a tip and also means I can get back to solid decluttering. I'm also hoping that the nursery can get her to nap longer in her crib; right now it's 25-35 mins max, but longer crib naps also mean I don't have to contact nap, which also helps a lot. A lot of exciting happenings in the next few months 🙈.

misslolu

Finally payday is here! The joint account has taken a mini battering because of the small amount I get from SMP, so far we haven't needed to go into savings but i'm anticipating that we may need to in July to tide us over. This does assume I don't get paid any KIT days for July. If I do get some KIT days then we should be just about fine. Finances at the moment:

CC1 (Mine) -   4,287 2,898

CC2 (Ours) -   11,037 12,411

CC3 (His) -   227 0

CC4 (His) -  2500 2,300

Total Non - Mortgage Debt -  18,096 17,609

S&S LISA -  17,716 18,561

Premium Bonds -  10,275

.Personal Savings -  8,932 9,300

Joint Savings - 1,600

Savings Total - 39,736

I had to take another look at the savings total because it really seems to have hugely grown over the past few months. OH also has a personal savings pot that I don't add here because I can't really be bothered to have to ask for the value all the time. I know he has at least £10k in it, so it's a great cushion to have with our planned move coming up next year. Someone asked why we don't just pay off the debt with savings, especially now we're at almost double, and there are a few reasons why. 1. Both of us have S&S ISAs that are for long term savings like retirement and potentially education for the kids. 2. For us, It's better to carry the debt for now while paying minimal interest, we'd rather have a big deposit and slightly reduced affordability, if we need to change that, we're happy that the funds are available to do so. 3. OH would rather take the scenic route at this time when we have lots of potential outgoings coming up. However, debt is a priority for me and I will be prioritising it from our cashflow when we're back to normal finances.

In addition, i've had to move some money on the CCs around to take advantage of some 0% balance transfers on CC2. So while one CC has gone up, one is down and another is fully paid off! I now have 2 months to pay as much as I can off CC1 before it becomes interest bearing again. I'm loathe to open yet another card and in fact i'm thinking of closing one or two that aren't too useful. Ideally, this would be paid off before the end of the year so we only have the two cards to focus on. Luckily the card i'm moving it to has low interest, so if we pay it off quickly, we pay less than £100 in interest for the year. I'm strangely feeling very positive about the debt and getting it to a more manageable level this year.

misslolu

The last CC's have come out and we have a clearer picture of what our finances are like. With all these new cards being opened, I've noticed the DD dates are a bit all over the place. I need to make a note to change them all to the first near the middle of the month so I can keep better tabs on them. One or two surveys paid out this week as well, so those have gone towards the debt. It's funny because most people would sniff at £7 here and there, but over the past year I've been able to put more than £500 towards the debt purely from surveys. I have no capacity (or stomach) for extra work so this is what I can do to help out.

CC1 (Mine) -    2,898 2,389

CC2 (Ours) -    12,411 11,823

CC3 (Mine) 0 373

CC4 (His) -   2,300

Total Non - Mortgage Debt -   17,609 16,885

S&S LISA -  17,716 18,561

Premium Bonds -  10,275

.Personal Savings -  8,932 9,300

Joint Savings - 1,600

Savings Total - 39,736

Unfortunately, we're back to 4 CCs again because I managed to misread the T&Cs of CC2. I thought purchases were interest free until 2027 but it looks like they're only free until July which is weird. None of the other cards i've used have worked like that. Either way i've had to BT in and out of CC2 before the window closed, but for some reason I wasn't able to transfer the limit, and because of that, I've had to leave some on CC3. We've had a sizeable refund come through, and I made sure we paid most of it straight off the debt. I've just put in for another one which will go towards and hopefully pay off CC3, and then that's it for refunds until November at the earliest. I'm so happy we're still able to put money towards the debt even while cash flow is poor. Makes me feel like when we get back to normal programming.

I'm going back to work at some point next month, so I have to start getting myself together and putting some routines in place. Baby Lolu won't be going to nursery till September which should help finances, as that's a month with almost full salary that won't need to go towards nursery. I also need to apply for funding within a month of going back to work, so need to make sure i dont drop the ball on that. It's bittersweet, though, I absolutely do want to go back to work for financial and mental/emotional benefits, however, being with

misslolu

The last CCs have come out and i've set a reminder for next week, to move all the dates to the first for convenience and traceability. Ideally the payment on August 1st should be the last low payment to the CCs. I should be back to almost full salary in August, which should ease the burden on OH and will mean we have some buffer in the account to go towards debt and Baby Lolu's nursery.

CC1 (Mine) -     2,389 2,189

CC2 (Ours) -     11,823 11,587

CC3 (Mine) 373 343

CC4 (His) -   2,300 2,200

Total Non - Mortgage Debt -    16,885 16,310

S&S LISA -  17,716 18,561

Premium Bonds -  10,300

.Personal Savings -   9,300 9,200

Joint Savings - 1,600

Savings Total - 39,661

I was worried we'd have to go into savings this month, but luckily, due to OH getting paid weekly for some of his work, we do have enough in the account to float bills & expenses for the month though this is essentially robbing Peter to pay Paul. The hope is that with the extra money I get from the few days of work i'm doing at the end of the month, I should be able to contribute more to the joint expenses for the month, which should mean that in practice I will only take a reduced amount from the joint to pay the bills coming from my account.

We're hoping to get some good survey returns in plus a decent refund that should completely clear CC3 before we need to pay any interest. It should also allow us to start paying down CC1 in anticipation of the interest free period ending and me needing to switch to another card in August. For readability i'll still call it CC1 since it will be the exact same amount on it. Something I might do again is a debt free forecast to see how long it should take us to pay off all the debt "in theory" taking into account minimum payments only. It was definitely a boost to see how my additional payments were reducing the dates even if just by week.s By the next post I should be able to let you know where we are.

misslolu

So i'm back with some predicted debt-free days, and oh dear, it's not looking pretty. What I do to calculate my DFD is just plot my minimum payments on an Excel sheet using the snowball method. This means once I've paid a card off, I roll that payment into another card to increase the amount paid to that card. However, the overall debt payment remains the same. In this case, I have 2 DFDs, and the reason for that is that we usually get some refunds because of OH's work. The thing is, OH has been looking for work and is in some final stages of some jobs that should start towards the end of this year or beginning of next year. This would mean that almost £2k of refunds drop off my payment schedule, and I have to pay them from the joint account instead, pushing our DFD back by a few months. So, with no further ado, our current optimistic DFD is…

1st Jan 2029!!!

This seems so far away, and I'm really not happy about it. This also has a lot of caveats attached, e.g., no reduction in income, nursery fees don't increase, no big house or car bills, less savings, etc., etc., etc. Obviously, it's based on current minimum payments and doesn't take into account me going back to my full salary, but I won't really know all those details until I'm fully back to work, so likely I'll do an update then.

Our pessimistic date is 4th June 2029, which is pretty much the estimation without the £2k of refunds. Realistically this can definitely get a lot worse, but again, it needs a crystal ball to determine what big bills may come our way, so this will get updated as and when they come up.

To be fair, this has really lit a fire up my backside. 3 years to pay off the debt is atrocious, especially with our planned house move coming up in the next few years. As a family we need to be way more conscious of spending and need to put much more away to debt as soon as we can. Ideally, with my survey payments and some creative accounting, I'm hoping to shave a few weeks off the DFD every month. My ideal DFD would be December 2027, so a full 18 months off the current date. Ambitious, but I have faith that we can get much closer than we are right now.

A look at the pesky debts right now:

CC1 (Mine) -      2,189

CC2 (Ours) -      11,587

CC3 (Mine)  343 264

CC4 (His) -    2,200

Total Non - Mortgage Debt -     16,310 16,240

S&S LISA -  17,716 18,561

Premium Bonds -  10,300

.Personal Savings -   9,300 9,200

Joint Savings - 1,600

Savings Total - 39,661

We've made a teensy amount of progress on CC3 which is the one that needs to be cleared by the next payment before it becomes interest-bearing. The refund we're expecting should cover this with enough left over to start whittling down CC2, which will be very nice to see.

The family and I are suffering from a terrible lurgy so i've not really been able to do much more than make a few logistical calls and read emails. Hopefully I feel better in the next few days because it's awful feeling so rough while it's lovely & bright outside. It looks like Baby Lolu will be the first to recover, and i'm not looking forward to have to take care of a full strength mad baby while OH is at work and i'm half dead. Fingers crossed we all get better together.

misslolu

And just like that, my plans are already derailed. Long story short, a mismatch in my return to work expectations means i'm down almost £1k in our budget & crucially, nothing is coming in in July. We're much lower in the account than we were last month, which means we may need to go into savings, or up OHs contribution this month. I'm not quite sold on option 2, OH has basically been covering us alone the last few months and its put a small strain on him. I'd rather dip into savings knowing i'm back to 90% salary next month & can give the accounts a good boost. It also means I need to do some creative accounting for the refund to help cashflow rather than my ego. A look at finances:

CC1 (Mine) -      2,189

CC2 (Ours) -      11,587

CC3 (Mine) -  264

CC4 (His) -    2,200

Total Non - Mortgage Debt -  16,240

S&S LISA -   18,561 18,600

Premium Bonds -  10,300

.Personal Savings -    9,200 8,900

Joint Savings - 1,600 300

Savings Total - 38,100

Nothing has changed in the last few weeks, the main difference is i'm now putting all survey money on hold to go towards cashflow rather than paying off debt. It's amazing because this month i've managed to make over £150 on surveys which is my best ever month on surveys. With the refund we got this should actually cover CC2 & CC3's card payment which come out of my account and make a dent towards the other bills that come out of my account like the mortgage & council tax. Technically, i've put more towards CC3 than I had to but that was in anticipation of having the funds i'd need to pay it off fully this month. We've still needed to go into savings, but all in all an extra £121 has gone towards bills this month and it's allowed us to keep that amount in savings. We're at less than £500 in joint savings which is the lowest it's been in a long while, but i'm just super excited that we've made it 1 year into maternity leave without going into unplanned maternity-related debt.

So while it's sad the survey money hasn't come off the debt, i'm happy it's gone towards something sensible, and i'm seriously looking forward to getting my first salary when I go back to work!!! What I would give to be the golden winnder in premium bonds this month too, haha, well a girl can dream!!

misslolu

I'm back to work this week and I can't believe it, where has the year gone? It's been a nice slow introduction to work so far which i'm grateful for, but i'm not really loving the increased expenses. I'm definitely needing to go into my personal savings until I get paid this month. The joint current is looking very sorry for itself as bills have come out. I'm hoping that we can weather the storm with minimal purchases so we don't go to 0 in the joint savings.Bill payments have come out and this is what we're looking like finance wise:

CC1 (Mine) -      2,189 1,989

CC2 (Ours) -      11,587 11,355

CC3 (Mine) -  264 196

CC4 (His) -    2,200 2,100

Total Non - Mortgage Debt -  16,240 15,640

S&S LISA -    18,600

Premium Bonds -  10,300

.Personal Savings -     8,900 8,700

Joint Savings - 300 200

Savings Total - 37,800

Not enough has gone towards debt this month from the joint account, but this will be the last month of that. Going forward i'll be aiming to put £600 minimum towards it, with a much more likely amount of £800, which is roundabout what we were doing before babylolu was born. She starts nursery next month as I go back to work full time and that will have an effect on finances. At the moment, i'm not sure if we can absorb that into our normal expenses or if we have to up contributions. Either way, i'm not super comfortable with how low the joint savings are even if we do have personal savings in a pinch.

My salary did increase on mat leave, so i'm planning to up my contributions by at least £50, need to see what the increase is in my pocket first before I commit. Surveys will likely decrease a lot as I won't have much time for them as I go into the office. OH managed to get an offer with the civil service but has been told he's on a waiting list as no roles are available in our area. I'm hoping something does come up soon, because even though it will mean more days for baby lolu at nursery, it means a higher salary and much less stress.