Making a big decision and staying out of debt

Mumoffourkids

So I’ve decided to start a new diary. I did have a diary a few years ago which I used to track my way out of debt. I managed to pay off £12k of debt in 9 months and then my car died. So I bought a car on finance but then managed to pay that loan off two and half years early. Again leaving me with no debt. So for the last while I have been saving my money ready to make one of the biggest decisions of my life.

So now my big decision is whether to move to a completely different area and buy a house. I currently live in Essex but am seriously considering moving to Lincolnshire. I don’t have any ties to Essex, no family here apart from my children, all of whom bar one who live with me. My original plan was to buy a house further north and then use it as a holiday home until my other kids have left home and then I would move up there. However, on talking to one of my children, she actually suggested moving this summer as she will have finished her GCSEs and none of the other kids are currently in important years at school. I currently rent and although my rent is reasonable for the area and my landlord is amazing, it is still not my own place. I could never buy a place in Essex so my only chance of buying somewhere is to move somewhere else.

Moving would probably be best for us as a family. However, moving to what type of house. I prefer older properties and properties with character. I have recently viewed a property which has enough rooms for us and is like a cottage. It has potential for us and wouldn’t be too big once my kids have grown and left home. Then I have seen properties which are more Victorian with large rooms but in my practical mind, I can see them being a money pit, costing money to do them up and fix them but also huge money probably spent on monthly bills such as electric, council tax etc. I know I would love a large Victorian terrace house but I have to think of the money side of things and with being the sole income provider and will the cost of living currently rising, I know that this would probably not be a wise decision.

This diary is to therefore chart my progress on house searching and buying, moving and getting the property to how I want it. All without going into debt. 

Aaleigha

When hubby and I retired we moved to a cottage in Wales and we love it 
It has four small but practical bedrooms a largish kitchen small lounge and dining room 
Although we have oil heating and hot water we also have a wood burner 
Fuel bills here are less than they were in our 4 bed town house 

So find out what the bills are in any house you might move too 
We are also of grid for water waste that is 70 quid a year to empty and water is on a meter and here in Wales it's only 7 quid 

Also look at council tax before you choose 

Remember town houses often have very high rooms and most of the heat ends up near the ceiling 

Mumoffourkids

Thank you for your thoughts. I live in a fairly new build town house at the moment with very high ceilings and it does cost a bit to heat even though it is fairly well insulated. I think I will try and do an SOA based on the new house and possible costs. I have been thinking about the house I saw a lot today and although I could live with it how it is, there are a few things I could improve on, one thing I did love was that it had a log burner in the living room. That is something I definitely wanted,

Mumoffourkids

So I have done an SOA based on being in the house. I have probably over estimated a few of the expenses just to make sure. Some notes, the childcare is for school holidays. I do have a 16 year who does babysit but I tend to send three of the children to a holiday two or three days a week just to give me and them a break. The holiday cost is for our annual trip to Cornwall. This year is fully paid for so I have estimated what I will probably spend next year. I have two cars because one is for my daughter when she turns 17 this year. It was my eldest’s car and when she got a new one, I kept the old one. Any comments are welcome, especially if there is something I have missed.

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]

Number of adults in household........... 1

Number of children in household......... 5

Number of cars owned.................... 2[b]

Monthly Income Details[/b]

Monthly income after tax................ 1000

Partners monthly income after tax....... 0

Benefits................................ 2322

Other income............................ 767[b]

Total monthly income.................... 4089[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 600

Secured/HP loan repayments.............. 303

Rent.................................... 0

Management charge (leasehold property).. 0

Council tax............................. 90

Electricity............................. 275

Gas..................................... 50

Oil..................................... 0

Water rates............................. 50

Telephone (land line)................... 0

Mobile phone............................ 45

TV Licence.............................. 14

Satellite/Cable TV...................... 45

Internet Services....................... 30

Groceries etc. ......................... 550

Clothing................................ 100

Petrol/diesel........................... 70

Road tax................................ 15

Car Insurance........................... 45

Car maintenance (including MOT)......... 50

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 83

Other child related expenses............ 150

Medical (prescriptions, dentist etc).... 20

Pet insurance/vet bills................. 0

Buildings insurance..................... 15

Contents insurance...................... 8

Life assurance ......................... 50

Other insurance......................... 0

Presents (birthday, christmas etc)...... 200

Haircuts................................ 0

Entertainment........................... 150

Holiday................................. 200

Emergency fund.......................... 50

Stocks and shares isa................... 50

Pension................................. 60

Kids savings............................ 100[b]

Total monthly expenses.................. 3468[/b]

[b]

Assets[/b]

Cash.................................... 20000

House value (Gross)..................... 140000

Shares and bonds........................ 2700

Car(s).................................. 15000

Other assets............................ 0[b]

Total Assets............................ 177700[/b]

[b]

Secured & HP Debts[/b]

Description....................Debt......Monthly...APR

Mortgage...................... 130000...(600)......0

Hire Purchase (HP) debt ...... 11000....(303)......0[b]

Total secured & HP debts...... 141000....-.........-   [/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR[b]

Total unsecured debts..........0.........0.........-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 4,089

Expenses (including HP & secured debts). 3,468

Available for debt repayments........... 621

Monthly UNsecured debt repayments....... 0[b]

Amount left after debt repayments....... 621[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 177,700

Total HP & Secured debt................. -141,000

Total Unsecured debt.................... -0[b]

Net Assets.............................. 36,700[/b]

[i]Created using the SOA calculator at www.stoozing.com. 

Sunshine_girl2

Welcome back to diary land . Are you still doing all your sewing ? Buying a house is a big decision, I look forward to hearing about it all. 

Karonher

There is a nice surplus in the SOA but how much of the benefits/other income is due to having the children at home? The mortgage and secured loans virtually wipe out your earnings in one go. What will your SOA look like in say 5 or 10 years' time when there may be fewer people in the house?

Mumoffourkids

Sunshine_girl2 said:

Welcome back to diary land . Are you still doing all your sewing ? Buying a house is a big decision, I look forward to hearing about it all. 

Thank you. I still do a little bit of sewing but I have changed jobs and don’t seem to have as much time as I once did for my sewing. I still tend to make presents for any birthday parties the children go to and of course make clothes for my kids.

Mumoffourkids

Karonher said:

There is a nice surplus in the SOA but how much of the benefits/other income is due to having the children at home? The mortgage and secured loans virtually wipe out your earnings in one go. What will your SOA look like in say 5 or 10 years' time when there may be fewer people in the house?

That is a very good point about what my income will look like in 5 or 10 years time. In 5 years I would expect to still have at least 3 children at home and the secured loan will have finished by then even if I don’t overpay it. In 10 years time I will still have at least two children at home so will still have some other income but expenses will have dropped due to having less kids at home. Also the salary is only a part time salary. As soon as the youngest two children are in their final years of primary school, I will up my hours to full time and so will earn more salary and will rely on benefits less. Again this will probably be in about 5 years time. 

I’ve just done another SOA based on on only 3 children at home so benefits going down but my wages going up. Also taking into account expenses will have reduced due to less children at home and the secured loan will be finished. This gives me a surplus of £536 a month. 

Mumoffourkids

So today should be a no spend day as I worked last night and don’t plan on going out anywhere today. Three of the kids are back in holiday club tomorrow so I’m going to try and decluttter the house a bit as if I do end up moving, then I need to have a serious declutter in this house!

Decluttering will also help bring in some extra cash to help with the move. I probably need to make a list of things to do and declutter and try and sell. 

I have also been looking at any new properties which have been added today and none compare to the one I saw at the weekend for either price or size of property/suitable layout.

Mumoffourkids

Today I ended up spending as we had run out of bread and milk again! I can’t wait for the kids to go back to school and stop eating so much! I also shouldn’t shop when hungry and I haven’t done a meal plan for this week so I ended up buying some bbq chicken and cheese coleslaw for dinner tonight as well. Tomorrow I need to do a meal plan using up the food in the house and work out when I need to do my next big shop.

Honeysucklelou2

Good to see you back again 🙂.