Onwards towards mortgage free living

gillynomad
gillynomad Posts: 99
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edited 30 October 2022 at 7:58PM in Mortgage-free wannabe

Hello! I’ve been lurking on the site for awhile and have been trying to put a lot of the advice and tips I read into practice. However, I think that keeping a diary for myself will help me to keep track and stay motivated. 

I’ve just hit my 30s and became a house-owner in 2018 after spending years saving for a deposit. It’s just me (and my dog) but I have been lucky enough to have a pretty decent income since I started working full-time so I’ve never had any real money issues (plus I am fairly risk averse…)

But the current climate around mortgages etc. has made me a little nervous for the future, although I’ve always had it in my mind that I want to be mortgage free sooner than the 30 years I signed up for. 

So financials:

  • Mortgage owed: £132,234.37
  • Fixed rate: 2.67%
  • Fixed rate end date: 30 Apr 2023
  • Remaining term: 25 years 6 months (Apr 2048 - Based on overpayments I’ve made to date my remaining term is Feb 2047)
  • Student Loan:around 3 years left
  • Debt owed: 0 (I have cleared my credit card last month and the only “loan” I have is a car lease for the next 4 years)
  • Emergency Fund: £6,000
  • Savings: £12,000 (Some of this is set aside for a planned holiday next year, and the rest is a combination of house improvements savings and general birthday/xmas fund)
  • Pension: Honestly don’t know exact figures but I think I am roughly at a predicted £12-15k/year (incl. state). Ideally I’d want to be around the £20-25k/year mark. I pay a monthly % (although it’s less than in my previous job role last year). In theory I have the time to get there so it’s not a huge priority over the next 2-3years but am planning to up my contribution once I’ve remortgaged…

I currently have about £1200/month after mortgage/bills etc. Up to this point I’ve been focusing on building savings and emergency fund (and just generally enjoying myself after the lockdowns etc.) but with everything that’s hit the last few months my focus is now switching…

My 10 year goals

  • Reduce mortgage to £50k
  • Be student loan free
  • 12k Emergency fund (based on current salary for 6-7months )
  • Save ~£50k for House improvements
  • Save 10% of salary a month to pension (not including company contributions) 

So they are my long term goals however, as I said I am switching focus and financially my goals will be to do the following:

My 12 month goals

  • Reduce mortgage to £115,000 (around £17,300)
  • 7k Emergency fund
Mortgage: £118,049 (Dec 2023)
Initial MF date: Apr 2048
Current MF date: Dec 2044

MFW 2022 #98 £2,2000/£1,800
MFW 2023 #35 £7,510/£7,500
MFW 2024 #24 £400/£5,000
MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

Weight Loss Q1 24: 3/12lbs
«1345678

Comments

  • My daily interest is currently: £9.92
    My monthly interest is currently: £307.63

    I overpay £150/month by DD but this month I've started making weekly payments towards my mortgage. So far I've added an £200 with another approx £200 to add tomorrow. 

    I need to have a look around at some savings accounts, as my current account where my emergency fund is held has pretty poor interest rates. 
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • IAAM
    IAAM Posts: 95
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    Hi Gillynomad. I just wanted to wish you the best of luck with your goals - although it sounds as though your strategy so far is really paying dividends for you :-)

    I only started my MFW diary on here about a week ago but, for me, it has definitely added a level of accountability and focus that I needed.  
    Mortgage Balance: £162,615.84 (December 2022); £163,945 (November 2022)
    Current MF date: Feb 2032.  (Previously: Jan 2033)

    Target MF date: May 2027
    (Overpayments needed to achieve this: £1,750pm!) 

    Joint spend: £391.09 (Nov)
  • My salary sacrifice for pension started today (my current job sets you up with a normal one and you request the sacrifice scheme which I hadn't realised). So that gave me an extra £70 which immediately went to clear my "minor" credit card (a cc I use for certain payments but clear at end of month so I don't pay interest hence I don't count it as debt). Was nice for that to essentially feel like "free money" this month as I hadn't budgeted getting the extra. 

    Made the additional £200 overpayment to mortgage which means for October I managed to overpay £550 (£50 shy of my target). So happy with that! I had a few extra payments this month with a new car so wasn't sure if I'd been ambitious. 

    This month is going to be tricky...I love Christmas and tend to go overboard on presents and just general xmas spirit. I need to sit down and write a budget and make sure I stick to it. 
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • Hi Gillynomad,
    It certainly looks like you're someone with a firm plan. We seem to be a similar age with similar goals so I'll be following your diary with interest. 

    Good luck.
    Solo Buyer & MFW
    Start date: January 2016
    At it's highest: -£237,000
    Current Balance:  -£73,754 (March '23)
    2021 OP total: £6,000
    2022 OP total: £10,535

  • @CasualMFW - I love making plans. Normally have issues sticking to them  :# hoping posting here will help keep me focused!
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • So done a reccy on my "loyalty" cards to see if there's ways to reduce spending this xmas. So far found the following:
    • Boots: £50.02
    • Waterstones: £47.75
    • Nectar: £130.57
    got a few things in mind that those amounts could be used on so that covers me for a couple of family members. 
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • made my first overpayment today for November - £150 to get me off the starting block.
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • gillynomad
    gillynomad Posts: 99
    First Anniversary Photogenic First Post Name Dropper
    Forumite
    edited 3 November 2022 at 9:35PM
    The interest rate rise today hasn't made me feel particularly great - just added on the pressure to ensure I am careful with my money over the next 6 months and do as much as I can to overpay what I can. 

    I decided in October that everything above £7500 in my Chip account when I get to remortgage time will go towards a bulk overpayment (I have plans for renovations that have been put on hold due to the climate...). I've got just over £600 at the moment. I've chosen not to move the money etc. (1.1% interest) simply because of how the account works. 

    I also checked my Emergency fund account to find out it's 2% interest rate so will probably keep it there for now but need to find somewhere else as I need to go into a branch to get money out which isn't practical (although living in a city makes it easier and the bank still has a place in the town...for now.)
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • DD overpayment came out today with my standard mortgage payment so another £150 to make £300 for November so far
    Mortgage: £118,049 (Dec 2023)
    Initial MF date: Apr 2048
    Current MF date: Dec 2044

    MFW 2022 #98 £2,2000/£1,800
    MFW 2023 #35 £7,510/£7,500
    MFW 2024 #24 £400/£5,000
    MFi3-T6 #41  £19,445/£27,495 (Mortgage Target £110,000)

    Weight Loss Q1 24: 3/12lbs
  • Hey Gillynomad - welcome to the board and thanks for sharing your plan. You seem super in control and really focused! We're of a similar age and I share some of your goals, so I'll be following your progress with interest :smile:
    May 2020 opening: £181,500, 21 year term. £14k additional borrowing December 2021
    Current balance: £153,493 (inc. offset in savings)
    MFW #37. Aiming to pay off by December 2033
    2023 OPs: £2,049.05
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