10 years to clear £334K - our FIRE journey

KajiKita

I can see why it is useful to get it out of your head and down on paper - there’s a lot of it! 

Presumably you are discussing all of the plans with Mr CCW? Would it help to get it all on a rough timeline for 2024 with rough costs, v. extra income spikes (savings maturing, bonuses etc) or where you want your minimum EF to not fall below, and times where you both have a break? 

KK

CCW007

That's what I'm thinking KK - we;re trying to get all projects listed so we can prioritise then plan the work around finances. 

Kitchen has thrown a curve ball as it looks like we will be progressing with the fitted kitchen in February (we have just made an appointment to design the kitchen on Monday!!) and don't have anything ring-fenced specifically to cover it but we can borrow from the stooze pot in the short term then repay it and start building savings for future projects before they occur!  

Factoring in breaks will be important as there is a lot to get done.

CCW007

Goals for next year - to be added to!

Mortgage going into 2024 will be around £308,700.  With regular payments, this will reduce to around £295,000.  Aim to OP to reduce balance to £293,700 = £1,300 OP from surveys, cashback, switching fees etc.

Create (and spend!) buildings fund of £30,000 = share save maturing, interest, and monthly saving of £2k on average.   To be ring fenced and spent on building projects only.  Projects to be prioritised (kitchen first).

I don't have an emergency fund as I have stoozing money so would use that in an emergency (and my WIOTW figure would increase) or I could raid my S&S ISA which is part of my retirement plan if neccessary.  Consider saving a specific EF?  £5k to start?

Any other money raised or saved to go against my WIOTW (What I Owe The World) figure. The aim is for it to decrease by at least the amount paid off the mortgage each month so I am not funding the building fund by taking money out of the WIOTW fund.  WIOTW figure is likely to be around £275,200 at end of year, this should be £260,000 by end of next year.

It all feels like "numbers in a spreadsheet" but would be good to have money assigned to a pot.  I tried YNAB years ago but didn't get on with it.

savingholmes

I think of an EF as a series of steps

1. Baby EF for peace of mind £500-£1K depending on your circumstances
2. 1 month EF covering basic bills but not wants
3. 3 month EF covering basics
4. 6 month EF covering basics
5. 12 month EF covering basics
6. 1-2 year EF if desired covering basics and typical wants

Only you can decide which of the steps you are comfortable with or how quickly you want to get there. I slept so much better once I have a baby EF. I'm currently around step 3. When I move house I hope to be at step 5 or beyond.

If you are paying more interest on your debt than you can earn on savings that plays into the calculation too, plus whether you are a two income household and how 'safe' or otherwise your job / industry is. Plus what your sick pay, redundancy pay etc would be. How old your car is. What your pension provision is like etc.

Good luck with your reno plans.

KajiKita

@savingholmes, that’s brilliant! I am so lifting this and measuring my EF against it 😊👏

KK

savingholmes

KajiKita said:

@savingholmes, that’s brilliant! I am so lifting this and measuring my EF against it 😊👏

KK

Glad it helped 

CCW007

Mortgage - £308,865
WIOTW - £274,967
EF - £0
Building fund - £0
Reduction this month - £4,393
Reduction since April 2023 - £6,032

Prediction for end of January
WIOTW - £273,767 
EF - £473
Building fund - £1,000 

Good reduction this month, disappointing performance over the year but we have done a lot / spent on things like the workshop which will reduce costs in the long run so not overly concerned.

I need to work out how to track the EF and building fund but will start from beginning of Feb.

CCW007

We've ordered our kitchen!! Should be here end of February so installed in March. Very exciting / terrifying.  Got what I think was a good deal and will do it on buy now pay later to keep money in our account earning interest for 12 months before paying off in full and avoiding interest on the purchase. 

Paid the deposit today after the credit card statement was generated so won't need to pay that until late February and will mean we can save up the balance in the meantime to avoid taking money out of current funds.

Lots of organising to do, flooring to decide upon etc so will be busy over next two months.

Found out my colleague who had health issues and was off for a lot of last year is poorly again so likely I'll end up supporting her team again so workload is likely to increase.  Feel so sorry for her and her family - she has teenage kids.

Thanks for the advice on EFs @savingholmes - all my debt is interest free and stoozed so earning interest and I'm happy to have it.  We have more in savings than the debt so am comfortable with that.  I'm going to aim to build £5k EF this year which is specifically earmarked as such as we do have access to other funds if SHTF.

Crazycatlady2

Ooh new kitchen envy 😂. 

It's on my list for this year but I have to convince hubby first 

CCW007

Good luck with that 🙂