The Plan

Scrimps · 19 October 2017 at 8:40PM

Ive called this 'The Plan'...because im terrible for constantly planning financials things, goals, spending etc. This habit followed my 20's of constant overspending with little thought to what I was doing and little enjoyment gained from doing so, I never want to be so wasteful again - I worked very hard and had nothing to show for it. I think working that hard was a mistake also, I would like to live with more intention, peace and play in my life.
The constant planning does seem to work for us as we have done well paying down debt and getting ourselves into a much less precarious position than previously, to be honest we couldve done it faster but I am happy with where we are.
We were in debt, not a huge amount but enough to cause us constant angst and limiting our options. We took massive pay cuts to move to the south west, our debt was probably equal to one persons salary.
We paid it all off, had a good couple of years of holidays and now we're expecting our first child with only the mortgage debt. In anticipation of expecting our first child, we have fixed for 5 years but we borrowed an additional £14,000 in order to get a driveway done (terrible parking in our area) and external wall insulation which has made a massive difference to the comfort of the house.

Todays totals:
Mortgage 1: £123,000
Mortgage 2: £12,500

I can overpay just under £15k without penalty each year - year ending 30th April
So far we have overpaid £5,700
The aim is to overpay £12k each year, so £6,300 to be paid before May 18.
£6k a year should be very doable even when I go on maternity leave in just over a month, £12k a year will be a lot of focus and effort but I think will be possible.

We're motivated to do this as we want to pay down the mortgage as much as possible before the kid is old enough to realise it is going without

We both have a very strong desire to work part time, me in particular. I find that the more I get paid the more I suffer from 'neverbloodyhappyitis'. I did have a menial/poorly paid job when we first moved down which I rather enjoyed but because we were in debt I was often working 7 day weeks, rarely anything less than 6 days a week.
I am now fairly well paid again, less than before we moved but doing OK, it has been a slog to get here and I am grateful for it. The bosses seem consistently pleased with the work I produce but I find it stressful, I cant stand the corporate nonsense that goes with it and feeling trapped in my job for the higher salary.

I would like the option of having a menial/low paid/doing job that I actually enjoy doing again or going very part time so the corporate nonsense has less affect on my life. Im not particularly high up, I could really throw myself at it and get a career going again, I wanted one once but Im not sure Im cut out for it anymore....at the ripe old age of 35 Im disillusioned and burnt out by work :rotfl:

I will do our SOA over the next couple of days and outline my plan. The above is just the reasoning and current status.

I will be using this diary to keep on track but will not intend to update every day, I will endevour to keep updating because these boards are so helpful!

Scrimps:beer:

louloubelle79 · 20 October 2017 at 6:40AM

I agree with your plan, lifestyle and less stress more important that loads £ In bank. Good luck with your journey to becoming MF :money:

Debtslayer · 20 October 2017 at 7:22AM

This post could have been written by me!
Totally agree with less hours at work and definitely less stress. I also feel trapped in my job because of the need for the salary. You've given me new motivation to change things if possible.
Good Luck X

Escapar2020 · 20 October 2017 at 8:01AM

Ditto ditto ditto, I'll be following! Goodluck!

bexster1975 · 20 October 2017 at 1:54PM

Hello Scrimps!

I could not agree more with this sentiment. I have paid off my mortgage, and have more in savings than debt ( 0% CC) and have recently quit my job to start my own business. With low outgoings, I could get paid work in my field for just two days a week if I needed and all bills would be covered ( with a little left over!)

Here's to working less and living more

Bexster

TwentySomethingGirl · 20 October 2017 at 3:44PM

Hi and welcome from another imminent mfw on mat leave! I'm not sure if we'll be able to keep up any overpayments while I'm off (SMP only) but will still try.

Good luck with it all!

TSG

debtfreeforlife · 20 October 2017 at 5:16PM

Good luck, I'll be following with interest!

Scrimps · 20 October 2017 at 6:24PM

The SOA below is from December with my expected mat leave pay. I have worked it out a couple of times and this does seem right but I am awaiting a proper illustration from payroll, it may change as I am asking for pension contributions to continue to be taken. Ive mentioned my suprise at the amount it to mums at work and they nodded and said yes it was a very generous allowance. If ive had a howler on the calculation then I shall re-work it when payroll get back to me.

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1 (pending Dec 17)
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 900 (predicted for mat leave)
Partners monthly income after tax....... 1430
Benefits................................ 89
Other income............................ 0
Total monthly income.................... 2419

Monthly Expense Details
Mortgage................................ 556
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 118
Electricity & Gas....................... 50.50
Water rates............................. 38.5
Telephone (land line)................... 18.99
Mobile phone............................ 0
TV Licence.............................. 13
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 230 (£30 cat food)
Petrol/diesel........................... 80
Road tax................................ 12.5
Car Insurance........................... 35
Car maintenance (including MOT)......... 60
Car parking............................. 10
Pet insurance/vet bills................. 50
Buildings & Contents insurance.......... 19
Life assurance ......................... 18 (need to get this weekend but this is the middle of the quotes I have so far)
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Clothing................................ 0
Any discretional spending such as haircuts, mobiles and holidays etc above, listed as zero comes out of personal budget of £150 per month each. My mobile is £5 a month. DH is about £15 I think (contract). I get my hair cut at the college every few months (£20) DH has his done and T&G every couple of months (£36). Pressies etc we just sort out our own side of the family - also out of this budget.

Total monthly expenses.................. 1,610

Assets
Cash.................................... 7300
House value (Gross)..................... 180,000
Shares and bonds........................ 0
Car(s).................................. 2500
Other assets............................ 0
Total Assets............................ 0

Unsecured Debts
Description....................Debt......Monthly.. .APR
Various........................150.00.....£45....... .0
Total unsecured debts..........150.00.....£45 .........-

Monthly Budget Summary
Total monthly income.................... 2,419
Expenses (including HP & secured debts). 1,610
Available for debt repayments........... 0.00
Monthly UNsecured debt repayments....... £45 (so we do have one item of debt - the sofa will be paid off in Feb. I checked and it would cost us £30 just to make an early payment to close the account, as its interest free we're just leaving it to run)
Amount left after debt repayments....... £ 760

Personal Balance Sheet Summary
Total assets (things you own)........... 189,800
Total HP & Secured debt................. -0
Total Unsecured debt.................... -150.00
Net Assets.............................. 189,650 (54,650?)

Scrimps · 20 October 2017 at 7:10PM

Thanks for all the responses, it is suprising the number of people out there that want to work less and live more, we seem to be the only ones in the group of people we know. Ive read some articles today, its not a new concept but its certainly doesnt seem to be the norm. Financial Independence is something Ive been reading a lot about over the last year or so.

So, my SOA is above, not sure on your thoughts on it but a few points of note in my plan to make it up to £12000 overpayment a year.

- DH does matched betting and is happy to continue so this will add income.
-I would like to start MB early next year but not sure if having the same IP address as DH will close the offers to me. In the meantime I'll do the other income generation things such as surveys
- I understand kids can be expensive, we're paying as much to the mortgage as we can before the kid begins to notice what its peers have in comparison

. We were given £750 from parents for all the costs, we still have £430 of this left and appear to have got everything we need. Including reusable nappies, breast pump, bottles, pushchair, car seat, crib etc.....we have been very lucky given a lot of stuff and have been warned to not buy anything due to how much you get given. I did buy a couple of bits from the charity shop - then we were subsequently given some of the same things....so it is true:D
-I am setting myself a challenge from November to not buy any clothes or cosmetics for 12 months. Ill save that discussion for another post.
Threats to this plan:
-One of our cats suffers from a couple of long term conditions, it does seem to have settled down but he has been very expensive and is on continuing meds. If he requires more spending he will get it without quibble, he is not insured.
-DH would like a holiday later in the year. We do things pretty cheap but its not on my radar for the year and I dont think he intends to buy it out of the £150 allowance.
- The £150 allowance was previously £200, we have just started sticking to £150 and holidays have never some out of it before - last year house maintenance and holiday were very spendy!
-We have only just been sticking to the food budget due to lack of planning.
- One of our cars is new to us this year, its MOT is due in December, I think it will need a fair bit of work.
- I dont see much fat to trim on our budget. All the 'low hanging fruit' (haha! exactly why I hate corporate work - I say s*** like that!) has already been picked as far as I can tell.

Things we have going for us:
- Im finding a wasteful consumerist life truely and increasingly repellent. Its not a case of denying myself stuff. I no longer want to get sucked into buying things I dont need to impress people I dont like

-We still have too much stuff, I have a few more things I can sell. Less clutter in the house is very appealing, further musings to follow some day.
-We're pretty well practiced at being tight with money I think, there will not be some big shock to the system.
- I will be off work. No doubt looking after a child will be a shock to the system. However, I am quite a task orientated person, saving money and running a 'old style' house will be my job and Im looking forward to it.
- We both want this, we have slightly different outlooks on how quickly and exactly how we want to do it but the goal is the same and we're usually pretty good at compromising.
Edit to add: -The house is pretty up together, meaning there shouldnt be any big expenses on the horizon. The amount we have spent over the last couple of years is a disincentive to spend more. Even though most people would look at our kitchen and say we absolutely needed(!) a new one

beanielou · 20 October 2017 at 10:22PM

A plan is always good.
Wishing you well.

bexster1975 · 21 October 2017 at 9:09AM

Hello again Scrimps

When I started overpaying my mortgage ( when I got it actually), I only overpaid a very small amount ( 10% of my monthly payment) but as I paid more off over time due to pay rises and cutting utility costs etc it became a bit of a game. Later still I realised I don't really need anything else ( obviously food each week, replace broken, faulty things etc). I too now do not enjoy buying stuff for the sake of it. I enjoy spending money on experiences, just not really things. When I buy, I try to buy very nice things that will last - though often I buy these pre loved at charity shops/ on eBay. I just think over time it was a mindshift. I have MK'd a lot of stuff over the summer and my home is less cluttered.

Your plans sound like an ideal way to bring up a little one IMHO.

The very best of luck to you

Bexster

The Plan

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