GAP and LMG, can we become mortgage free?

savingholmes

Hope you are enjoying the break. Happy New Year!

girlatplay

beanielou said:

Have the best time. Xx

Thank you xx

savingholmes said:

Hope you are enjoying the break. Happy New Year!

It was lovely, thank you.

girlatplay

Happy New Year to anyone reading.

I've had such a lovely break. Back to work tomorrow so thought I'd spend some time catching up on diaries as I've no idea what kind of mess I'm going in to tomorrow so likely won't have time to read through during the day and if I'm tired at night I sometimes don't bother looking at my phone.

I ended up coming in £8 under budget for Christmas and that included my yearly Christmas lunch with my best friends. It is quite a generous budget but I kept coming in short so have upped it each year and I now feel that it is a workable amount. I have already put some away for next (this) year. I think I've said before, my sister and I have a joint savings account that we both pay into, to save for Christmas. Around the end of October/start of November we get back whatever we have paid in throughout the year. This has been a brilliant idea for both of us, spreading the cost of Christmas and not having to use credit.

Also, we have a Christmas meal kitty with the rest of the family. We usually pay in something each month and then we can decide what we are doing for Christmas dinner. We didn't actually pay anything into the kitty this year but we had £75 left from last year that we had forgotten about. This year we decided to have it here so I cooked and hosted. I shopped savvy for the food which came to £111 (traditional turkey dinner with all trimmings, 2 different starters and two different desserts, plus cheese and biscuits, and some drinks, mainly soft - we didn't eat it all, there were lots of lovely leftovers), less the £75 from last year meant we paid £6 per head! (6 "adults" paid - LMG and my niece didn't).


So, to 2024.

I don't have any big resolutions (maybe try to have lights out by 10.30pm on a school night, although I better move myself if I am to achieve that tonight), I just plan to continue putting away what I can to the buy out fund.

I saw a post by someone I follow on IG. They have a new savings plan/challenge idea. They got 100 envelopes and wrote 1 to 100 on each one and every Friday they and their partner choose an envelope each and put that amount of cash into the envelope (so 5 = £5, 73 = £73, and so on). Luck of the draw as to which number they each get. At the end of the year they will have £5,000 in cash, or thereabouts. (I haven't checked their calculations). I really like the idea but I can't afford to put in those kinds of sums and I also feel it's a bit of a waste of envelopes, unless you plan to do it every year. I have adapted it to suit what I think I can afford. I have made a list in notes on my phone with the date of each Friday in the year. On each Friday I will randomly generate a number between 1 and 52 using a generator from a search engine. When I get the number I will divide that by 2 and put that into a savings account. If I generate a number I have already had, I will just keep trying until I get one I haven't had. Last Friday was the first one and I got number 5 so I put £2.50 into a pot I have created in my savings account. I feel that this is manageable for me. I should have just over £650 at the end of the year. I have some ideas of what this might go towards although undecided, but it's unlikely to be the buy out fund as this is a side plan/challenge.

Talking of the buy out fund, I have still been PADing and I managed £80 on payday (had £140 extra to play with from council tax and used the rest to top up other budget pots).

Declaring a PAD today (from 25/12 - 08/01) of £107. This takes my total to £2,602.45.

Another monthly mortgage payment has been made too.

Off to update my signature then must start getting organised for bed.

EssexHebridean

My biggest worry about the original version of the envelope challenge was that I wondered how many people were blindly going ahead and doing it without even stopping to think that by the end of the year they potentially had thousands of pounds in their home uninsured!  Also - allowing that you have to assume they can manage to set aside potentially several hundred pounds in this way in a single month if the "wrong" numbers come up in consecutive weeks, it leaves me thinking that they would probably save more overall by budgeting properly in the first place! Your version of the challenge sounds safer, more manageable and still something that will give a decent payback at the end! 

Your Christmas sounded very lovely indeed. It's far more sensible to have a figure budgeted which you can afford and which will also allow you to have the Christmas you enjoy, rather than feeling like you have to nail everything down to the last penny and you then end up either overspending or resenting the things you can't do! Doesn't it  make a difference knowing that the money is there for Christmas related stuff though - takes away so much stress! 

girlatplay

EssexHebridean said:

My biggest worry about the original version of the envelope challenge was that I wondered how many people were blindly going ahead and doing it without even stopping to think that by the end of the year they potentially had thousands of pounds in their home uninsured!  Also - allowing that you have to assume they can manage to set aside potentially several hundred pounds in this way in a single month if the "wrong" numbers come up in consecutive weeks, it leaves me thinking that they would probably save more overall by budgeting properly in the first place! Your version of the challenge sounds safer, more manageable and still something that will give a decent payback at the end! 

Your Christmas sounded very lovely indeed. It's far more sensible to have a figure budgeted which you can afford and which will also allow you to have the Christmas you enjoy, rather than feeling like you have to nail everything down to the last penny and you then end up either overspending or resenting the things you can't do! Doesn't it  make a difference knowing that the money is there for Christmas related stuff though - takes away so much stress! 

I have to admit that I didn't give a single thought to having lots of cash in the house. I never have more than about £20 in the house at any time, and not even that most of the time. I was more worried about 100 envelopes and the waste!  I know I can't afford (for example) £100, £99, £98 and £97 to all come out in one month but I feel I could manage £26, £25.50, £25 and £24.50 if that happened. I, like your good self, have been a MSE'er for a very long time and we know what we have available and what we can push ourselves to. I just always think that I never know who is reading my rubbish and it's good to show that challenges can be adapted to fit with what suits a budget. I would love to have £5k at the end of the year in this challenge but my budget says no.

Christmas was really lovely. Yes, it makes an enormous difference knowing the money is there. When we started the savings account I didn't know how much I was going to need but even just having something towards it was better than Christmas from scratch in November and December. Christmas just past is the first year I've budgeted enough and I've been trying since 2012!

girlatplay

Work is busy today, as expected. Bless the girls though, they have done their best to keep the volume of work down for me coming back. I did think it would be way worse than it is. They joked about wondering how angry I would be, depending on the level of mess ups they had done (I'm not an angry type of person, probably one of the most placid people in our office. The only thing I get angry about in life is being treated like I'm the dish fairy by LMG).

Just taking a quick lunch break so thought I'd log in to see what's going on.

£1 PAD from me today and now need to get back to it.

girlatplay

In further news today, we have had our payrise confirmed, backdated to 1st April 23 and will hit our salaries on payday this month (31st Jan). My calculations suggest back pay somewhere in the region of £600 after tax so in anticipation of that I have moved £500 from my short term emergency fund and £500 from what I have in the current buy out fund savings (I save £1,000 then move it to a higher fixed interest paying account) and put them in the higher int. account. I've done this now as I've noticed the savings interest rates coming down of late and I want to get the best I can. If I wait until payday I might miss out on a few 0.1%'s. There is 0.31% difference between the EF and the savings account (in favour of the savings acc). I know it's pennies but pennies count, right?

I know I don't technically have the funds yet but since I have already moved them into place and will just be replacing the £500 on payday (which is guaranteed), I'm going to declare a further PAD today of £500 and I'm going to update my signature.  On to the next £1,000 brick.

savingholmes

Well done on the PAD and move to the next brick. I don't know whether your signature reflects your up to date picture but at 3,103/40,000 it would be equivalent to 7.76% - I find tracking the percentage part also helps. 

beanielou

Woohoo. That’s fantastic. 

EssexHebridean

Oh that’s great to have the pay rise confirmed, and getting it with back pay as well - cracking! 

Completely agree on the adaption of challenges too - there’s a fine tradition of that on here too isn’t there. I suspect a lot of the folk being seduced into the original challenge will end up giving themselves serious cashflow issues because the thing that looks so cute on insta turns out not to be so practical in their own circumstance! Thank goodness for this place teaching us the value of budgeting and ensuring that the books balance!