FIRE Girls Pension Diary - Aim High & Dream Big

Firegirl

Have you a diary I can follow @Sensiblesaver?  So great your income has doubled. Congratulations!!!! I kept my general life style the same but I have splashed out on holidays. Memories that I’d never get back with my kids.  I’m so glad I wasn’t to strict with myself, and found a balance.

Sounds like we are on such a similar path. My oldest son has a part time job now and he is doing amazing at saving.  Also means I don’t have to give him pocket money and I’m charging him £10 a week digs money. Exciting times seeing what they do next 

Firegirl

Decisions made! Some news recently that the project I’m working on will continue until June 2025.  While not 100% it’s as certain as I can be that I have another year in this job.

Decision 1 - Any extra funds I have between now and June I will add to my ISA.  My ISA is out preforming my mortgage interest.

Decision 2 - If my contract is extended in June I will change to umberella company and heavily pay to pension to bring me out of high tax bracket.

Decision 3 - Abandon MFW journey and just let that ride its course.  I will keep my payment the same each month as it’s always been and hopefully interest rates will go down soon and effectively we’ll be overpaying more by keeping the payment the same.

Task - once moved to umberella set up regular payments to ISA again and settle into a new ISA/Pension savings rhythm that is a bit more predictable and less adhoc.

Onwards and upwards. 
 

hugheskevi

Firegirl said:

Decision 2 - If my contract is extended in June I will change to umberella company and heavily pay to pension to bring me out of high tax bracket.

Decision 3 - Abandon MFW journey and just let that ride its course.  I will keep my payment the same each month as it’s always been and hopefully interest rates will go down soon and effectively we’ll be overpaying more by keeping the payment the same.

My mortgage was mostly deprioritised below putting higher rate tax income into a pension and making full ISA contributions, at least until we had enough saved into our DC pensions. It was surprising how rapidly the mortgage reduced despite being such a low priority. As it was just where the last bit of savings ended up going each year, it was also a nice motivation to keep a lid on spending and exploit any other forms of income as they then all went toward reducing the total. In the early years, it was a mad scramble for cash each March to use up the last pension and ISA availability, but after a few years everything got much easier.

Exploiting costless credit-card borrowing also put a huge hole into the mortgage. We generally had about £50-£70K of fee-free, interest-free borrowing on credit cards at any given time. I always ensured we could repay that from future income if necessary (ie not relying on rolling-over borrowing), putting everything else into mortgage repayment. Every time I had a new balance transfer that freed up more funds to put against the mortgage.

Although it was never the intention, we ended up mortgage neutral with our ISAs after about 8 years, and the mortgage was paid off 11 years after it started. Then I repaid the credit cards to simplify our finances as preparation for long-term traveling.

If I'd done it any other way we would have ended up with far too much income after repaying the mortgage to save efficiently into pensions and ISAs.

Firegirl

@hugheskevi

Thanks for sharing your story.  I really need to do the same and completely abandon my MFW dream and be happy with being mortgage neutral. I’m current mortgage neutral with ISA and mortgage offset savings.

I have done the 0% credit card borrowing a few times.  I end up just gradually paying the credit card off usually well before the 0% ends. I just can’t settle with it.  I got in credit card debt in my 20s, which wasn’t that high, but with a low income, it took me 2/3 years to get out of.  It’s a shame I can’t relax with credit card debt because it’s great way of doing it.  Strangely I’m more than happy to do interest free finance so I take advantage of that for any big spends.

Im looking forward to getting all this sorted out end June start of July and settling into a new more predictable rhythm.

MallyGirl

Firegirl said:

@hugheskevi

Thanks for sharing your story.  I really need to do the same and completely abandon my MFW dream and be happy with being mortgage neutral. I’m current mortgage neutral with ISA and mortgage offset savings.

I have done the 0% credit card borrowing a few times.  I end up just gradually paying the credit card off usually well before the 0% ends. I just can’t settle with it.  I got in credit card debt in my 20s, which wasn’t that high, but with a low income, it took me 2/3 years to get out of.  It’s a shame I can’t relax with credit card debt because it’s great way of doing it.  Strangely I’m more than happy to do interest free finance so I take advantage of that for any big spends.

Sadly the days of great stoozing are behind us but 0% cards can still help a bit - we put our solar/battery across a couple which defers paying for them for a year or so. I miss the combination of Egg and their fee free cash transfers (I wonder why they folded!) combined with an offset mortgage. It certainly helped us to be MF before we made the last move.
I totally understand the 'once burned' feeling though and you have to be comfortable with your own plan.

swindiff

I started Stoozing again when interest rates went up. Well worth it to me atm. 30k on 0% credit cards earning me £1500 a year. Halifax clarity CC offers free money transfer to your bank account.

LL_USS

MallyGirl said:

Sadly the days of great stoozing are behind us but 0% cards can still help a bit - we put our solar/battery across a couple which defers paying for them for a year or so. I miss the combination of Egg and their fee free cash transfers (I wonder why they folded!) combined with an offset mortgage. It certainly helped us to be MF before we made the last move.
I totally understand the 'once burned' feeling though and you have to be comfortable with your own plan.

Quote of the day "You have to be comfortable with your own plan" - very true.

Managing personal finance can be fun up to a certain line. We may know lots of good ways of making the money work harder. Yet it is hard work to us too. I do "let go" certain methods that I feel I would run out of steam managing them.

@Firegirl - mortage neutral rather than mortgage free makes sense in your case when you use that sum for a better investment, and you have savings that can be liquidised quickly to pay off the mortage if you need.

I admire those of us who can manage stoozing or max interest free on credit cards. I feel not competent enough and would be too stressed.

Firegirl

Stoozing - It terms of organising and doing it, it’s no problem at all but mentally I can’t get past credit card debt!  I’ve tried a few times, back in start of stoozing days, a few years ago and once more recently. 

It doesn’t do any harm cause I gradually chip away at the balance and pay it off but it’s probably not worth it cause I can’t switch off from it. Still the few times I’ve done it I’ve likely saved a bit!

Sensiblesaver

Hi, I do have a diary Mortgage Free in 4 years. Although I should be focusing on the pension I can't abandon my dream of getting rid of the mortgage. I don't buy much stuff, but also like to spend on memories and holidays are a must

Last year at the age of 44 I decided to learn a new sport and booked kitesurfing lessons for the entire family. It is neither easy or cheap lol Me and my son really enjoyed it and will be having more lessons this year, hubby is too unfit and has given up lol

michaels

Sensiblesaver said:

Hi, I do have a diary Mortgage Free in 4 years. Although I should be focusing on the pension I can't abandon my dream of getting rid of the mortgage. I don't buy much stuff, but also like to spend on memories and holidays are a must

Last year at the age of 44 I decided to learn a new sport and booked kitesurfing lessons for the entire family. It is neither easy or cheap lol Me and my son really enjoyed it and will be having more lessons this year, hubby is too unfit and has given up lol

Well done, it is the sort of sport I would be up for if I had the fitness but looks an absolute killer with no 'do it but in a relaxed manner' option as I do with snowboarding.