Prosperous soul embraces creativity & mortgage neutrality

Bargainhunter30

Glad your recovering Savings and well done on all the goals you're achieving, lbs lost and ££'s gained. I would say about the ensuite, if it's only to benefit DD, give it a year until she knows where she wants to be. You may do it and then a month later she moves out...

jwil

Well done on the weight loss!

Orangetoes

Well done on the weight loss! You are doing really well. 

savingholmes

Thanks Beanie, Micky, jwil @Orangetoes and @Bargainhunter30

Well I submitted a gas meter reading. Nearly identical in size to last month so hopefully around £24. Scary that's hot water and standing charge only. Very grateful I managed to fix electric - shame I couldn't do the same for gas.

savingholmes

Finished early today. You can tell what kind of day it was as in any spare moments my thoughts were on - how could I leave work sooner / reduce my hours!!

So how can I get to early retirement / financial independence even with my huge mortgage? If I was allowed to keep my current grade but reduce my hours to 3 or 4 days per week in 8 years time - I could then do what's known as 'coast F1R3' where you don't have to have all the income you need upfront as you use part time work to subsidise your pension. That would mean I could keep adding to my current DB pension rather than eroding it while using a previous pension. If work didn't agree to that - I might be able to apply for interim part work in my field and achieve it that way. I would potentially earn a higher day rate - but that wouldn't have the pension, sickness and annual leave benefits - and would increase uncertainty - so that wouldn't be my preferred option.

Work provides a lot of structure for my life - and a lot of the little social contact I have - which is why I think I'd be better off keeping it in place of possible even if I reduced my hours. I do worry about things way in advance - and a lot of my closest colleagues are due to retire in the next 3-10 years. My best chance of getting such arrangements agreed would therefore seem to be prior to them leaving! I also would need to put the right mortgage deal in place so my rate wasn't jeopardised if I went part time.

If the above wasn't an option then I'd look at downsizing to achieve it. There has to be a way - that balances social, keeping my brain cells active and having a good enough income - with having more time for me and what I want. If I could do it sooner even better. After I'm 55 (3 years) I can get an updated cetv for my previous DB pension and see what options that gives me. If I get P1p - my current plan is to save / invest as much as possible so I can leave work earlier / reduce hours longer term. I'm trying to create a clear plan so that I don't fritter spend any gains away - while balancing that with any home improvements that would definitely add value.

jwil

I spend loads of time thinking the same, which is funny as I don't dislike my job.  I still have aims to retire in 11 years - totally unrealistic and not going to happen, but that's the point at which I know I'll have enough set aside in my pension to be comfortable and will have cleared (or worst case scenario, almost cleared) the mortgage.  I just need to figure out how to bridge the gap between then and retirement age.

I love seeing your plans, they are always thought provoking.

MovingForwards

Congratulations on the weightloss.
Anything you change in your house, do it for you and not any potential buyer.
Would it be viable to use all the P1P to overpay the mortgage, target that while you have the money, with income covering savings and pension.

We've dug out fan out and it's made a tiny difference, not enough to brag about though!

savingholmes

Thanks jwil and MF

I still don't have my P1p decision MF but my mortgage is 1.84% - so I could earn more from regular savers or AVCs than paying it directly off the mortgage. If I put it in Regular Savers then I still could put it in the mortgage at a later date if I wanted / needed to - e.g. when the rate ends Dec 26 or if I later reduced my hours.

• I have a regular saver now that I'm cycling my existing EF into at a rate of £200 a month that will pay up to 2.5% per year. (up to 3 withdrawals).
• I started a second at up to 3.5% a year (no withdrawals) with £25 a month initially but if I get extra £ I'll increase that so I can put in the max of £3.6K per year.
• Depending on what I got - I could do another regular saver at up to 2.5% for up to £200 a month (allows some withdrawals).
• Another bank account I've got is offering a 1% instant access saver. I could store any backpay in that while I wait to cycle it into regular savers.

If I put £ into AVCs - then I would get the tax rebate - but would be tied in until whenever I take that pension and there is a risk of loss as well as growth although that should balance out long term. There is also a cap on how much I could take tax free as a lump sum. The govt has also frozen the lifetime allowance for pensions for a number of years - which could cause problems later for many more of us than you might suppose - if the stock markets pick up again in future - and depending on how many years we have left to contribute.

AVCs and any other savings or investments would be funded from existing EF, my day job, DD's £150 pcm contribution plus P1p if I get it. I am conscious that even if I get P1p now - there's no guarantee that I'd qualify again as they could change the rules or my health / weight could improve and that could change any entitlement - both during the award period and for any future awards. I'm therefore leaning towards saving as much as possible (assuming I qualify) - particularly initially - in case I don't qualify for the help later.

I still plan to buy extra leave regardless and keep my counsellor - although I may have to go to 3 weekly if I didn't get funding. If I get it - I'd potentially increase my cleaners hours back to what they were pre-divorce and get her to slowly tackle my clutter hot spots. I think it would be wise to shelve home improvement plans for now - particularly given that if I start - I may struggle to stop!! At some point though I need to invest in my home or it won't realise what it should when I come to sell which would be annoying. I'd rather have the joy of the investment and get to use it - than lose £ in the sale that could have recouped my costs.

I looked on a property price site - and it suggested that my house had gone up £45K since I agreed a price with Ex. If that's true that's fab - however the remortgage lender was only willing to value it in October £7K below what I paid Ex so who knows. It's encouraging though - and does justify spending some £ on the property. I have hefty ERCs so no plans to move in the fixed rate period. I think I'd be wise to try and get to 3-6 months living expenses in an EF before spending. That will take a while in any event.

savingholmes

I had a text from P1p this morning to say I've been awarded it (but not what) - so compulsively checking my bank account even more now. They said letter could take 2 weeks. I'm due back pay of 5 months - so whatever I get - I should receive a decent chunk in one go as well as on-going money. What it also means is I should get an extra £150 towards my energy bill. It all helps! It's a relief to get some confirmation.

My cleaner has agreed to increase her hours by 1 a week to 3.5. Hopefully that way the house can get back under control rather than there being clutter everywhere. I could take a little bit of time off with my cleaner to declutter too. 

mark55man

well done - that's fantastic news -