Simple living in the country - back to basics

JGB1955

Elisheba said:

Glad your work event went well! Regarding the DVLA and car tax I pay by DD. It doesn't cost any more, and I think you can choose between monthly, 6 monthly or annual payments (although it's been a while since I looked into it so it might have changed). It just means one less thing for me to remember now it's automatic, which is a relief when you also have car insurance, car services, car MOTs, not to mention broadband, mobile phone, and energy all to remember to sort out each year. 

Paying monthly by instalments adds 5% to the annual cost.

Elisheba

@JGB Oh my goodness, so it is. I set mine up years ago when I was skint and haven't even looked at it since. I'll have to change it over to annual DD and save that £7.50. Better in my pocket than the DVLAs! 

joedenise

I just pay ours the day the reminder arrives.  Means we remain legal without too much hassle.

Cheery_Daff

I usually pay ours the day the reminder arrives!! May was a bit hectic this year and the wheels fell off a bit 😕 I did consider a DD but to be honest I'm never entirely sure the cars are going to last another year so it doesn't seem worth the hassle of cancelling 😂😂 Certainly not paying £35 a year in installments 😱😂 Glad you've saved yourself a few quid there Elisheba 😊

starnac

I've just had my tax reminder letter and it needs to be paid asap as I had a horrible experience last year over car tax! Thanks for the reminder to get it paid

Karmacat

I have these joys all to come 🤣  will definitely be paying on first reminder!

Cheery_Daff

Right - I said on someone else's thread (I'm so sorry, I can't remember whose!) that I'd check and stress test the mortgage.

We're currently on a 5 year fix at 2.26%. We pay £920 a month. 

Fix ends Sept 2024, and I wanted to work out what monthly payments will go up to at various interest rates. We likely won't have much choice - we were pretty limited when we moved here because we have quite a few acres (many residential mortgages only cover 1 or 2), and we're lending til Mr Cheery is 80.

I don't know if there's a better way of doing it, but I'm just using the basic MSE calculator. 

We're going to have about 158,000 left when the fix ends, and just over 17 years.

So, current rate (2.26%) is £920 a month

3% = £990 (increase of £70 a month)

4% = £1068 (+£148)

4.5% (current 'best buy' on the MSE calculator, although I haven't bothered looking if it would cover our circumstances = £1109 (increase of £189 a month)

5% = £1152 (+£232)

6% = £1237 (+£317)

7% = £1327 (+£407)

8% = £1419 (+£499)

9% = £1515 (+£595)

10% = £1613 (+£693)

Wow. That was an interesting if rather alarming exercise 😱

I'm due a bit of a pay rise in August, and after that I reckon we could absorb about a max of about £400 if we tightened belts and cut back on cafe trips and stopped adding to longer term savings - we'd still be able to save for annual stuff and a bit towards eg a replacement car etc.

So that takes us up to 7%. It's certainly making me seriously consider working full time again, although I really don't think they'll let me at my current job 🙄

I do realise we are in a fortunate position here - we won't be having to sell up, and with a good deal of thriftiness we could absorb a reasonably sized rise. Many people in a much more precarious situation than us, but I do still want to be prepared.

joedenise

I think I would make as much in overpayments as is allowed (assuming there’s a limit) in order to reduce the amount you need to borrow next September.  Those are scary numbers!

Elisheba

Glad you have a little bit of wiggle room mortgage wise, even if it won't be much fun. 

Cheery_Daff

We're not actually overpaying anything at the minute 🙄  we've been focusing on trying to build up savings a bit as they are really limited. We've still got various things that need doing to the house as well (need, as in rendering one of the outside walls, as well as 'wants' like windowsills (not replacing them - there just aren't any in several rooms).

So I don't know what will happen about overpayment. We could certainly be a lot more thrifty than we are - I'd be reluctant to overpay too much though without considerably more of a savings cushion.

Even if we did manage to scrape together that £400 I mentioned, that would only overpay us about £6000 between now and when the mortgage is due - which would save us £22 a month. That would be better as liquid savings I think - it would more than double what we have now 🙄

Either way, a definite focus on more everyday thriftiness I think, and I might start throwing little extras eg Prolific money at the mortgage as psychologically it will help even if the financial difference short term won't be massive.

Longer term I'm not too worried. Mr Cheery will get his state pension in about 6 years and that will be extra on top of now (he's already left work).

Still, it's all emphasising that we've been coasting a fair bit - not overspending but not being as thrifty as we could be, and not saving as much as we could be. It feels like a reasonably comfortable balance at the minute, but it won't if the mortgage goes up 🙄