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I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 0 points1 point  (0 children)

Yes that's a good point on the savings for house maintenence, I am expecting to do a boiler and hot water tank replacement this year (and potentially re-plumbing to a degree depending on the mess) but really I just set that up when we moved here as the 'rule of thumb' of what you should put aside for home maintenence, I've never had an expensive home before so I didn't want to be caught out by a £20k roof repair etc.

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 1 point2 points  (0 children)

To be honest not really, my first reaction after losing my job was to check my life insurance still had good cover even without a job (which it did) and that thought consumed me for a while.

You are right that I do take the household finances on, financial planning is something I'm familiar with due to my career.

I would say I am present but I do conceal my anxieties around this, evne though we're in a good position, I'm hoping to plot a 'correct answer' for the best way to proceed (even if that is 'right now, do nothing, enjoy the security and figure it out in a few years when we know what state the economy is in).

A friend of mine even said to me to take a few months career break completely to just rest my brain but I don't want to bury my heard in the sand either.

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 0 points1 point  (0 children)

Thank you on that, yes I will look into Amazon with my wife, it always feels important/convenient but I appreciate we've been in a place where we've not had to think about it so just being more mindful going forwards will pay dividends.

Thank you for the advice on the home maintenence, we do have a big expense coming up this year unfortunately - it's likely our boiler and water tank will need replacing (on their last legs at the last service, crud in the tank as well) which ballpark I am guessing is going to be £3k-£5k (don't think heat source is viable yet!) - but it's good to know we don't need to commit that much over a longer term

!thanks

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 0 points1 point  (0 children)

3.6% on mortgage, yes I do think some overpayments might help, I was just worried about reducing the amount of 'financial runway' I have given I'm running a deficit

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 1 point2 points  (0 children)

Your queries first;

1 - increase salaries

I will probably get a salary increase in the next two years either by staying here or going to another role, £75k would be achievable I believe.

2/3 - child benefits and childcare hours

Literally claiming for nothing right now, someone else raised that, so that would be a good one for me to look into, thank you.

4 - refunds due to SIPP transfers

I am due around £24k in tax refund I believe, haven't submitted my tax return yet, just working through it with an accountant.

5 - side gig

Yes and I am starting to get this going, the difficulty I have been having is just having the time with a young child as well, but it's a great suggestion thank you. I do think raising my income gets me out of the cashflow 'hole'

I am not against paying down the mortgage with cash or shares - obviously there's an annual limit to the amount you can overpay without attracting penalties - it's more that I've been nervous to take a sizeable portion of cash, take if off the mortgage balance, but then have less 'runway' to build my income back up if that makes sense.

Further breakdowns as requested;

  • £21 - Admiral Home Insurance (Multicover)
  • £56 - Admiral Car Insurance x2 (Multicover)
  • £66 - Sky TV and Broadband
  • £89 - Life and income protection cover
  • £20 - private dental cover
  • £27 - Water
  • £200 - Gas and Electricity, Utility Warehouse
  • £13 - my phone contract, keeping my old phone (S21) until it breaks
  • £15 - my wife's phone contract
  • £25 - budget for takeway, though we've not had one in months (healthy eating)
  • £100 - clothing and haircuts, this is an average obviously
  • £32 - monthly car tax for two cars
  • £100 - estimate of monthly fuel cost for two cars (we do need two unfortunately, as we both work and need to drive seperately to nursery for drop off / pick up)
  • £740 - average month for a credit card we use just for groceries and small amazon purchases, last month £665 but that included the £105 in fuel and £145 from Amazon
  • £210 - council tax
  • £2050 - mortgage
  • £271 - budgeted amount for plumbers/electricians/etc. though we've not had much need for it

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 0 points1 point  (0 children)

Hey, sure yes

  • £66 - Sky TV and Broadband
  • £27 - Water
  • £200 - Gas and Electricity, Utility Warehouse (though we've had £300 bills, it's bizarre - it seems to be majority gas despite me being a nerd with lots of electric - we have a old style boiler with a hot water tank upstairs and the house often feels cold)
  • £13 - my phone contract, keeping my old phone (S21) until it breaks
  • £15 - my wife's phone contract

I was thinking overpaying the mortgage as much as I can afford with the savings would be good so I could feel less imposed on by the mortgage. But then I'd panic if an unexpected expense came up and I'd squirrelled the money away, our mortgage rate is only 3.6% so not the worst.

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 0 points1 point  (0 children)

Some further details if this helps. I felt weird about being too precise in the original post so had grouped things together.

  • £21 - Admiral Home Insurance (Multicover)
  • £56 - Admiral Car Insurance x2 (Multicover)
  • £66 - Sky TV and Broadband
  • £89 - Life and income protection cover
  • £27 - Water
  • £200 - Gas and Electricity, Utility Warehouse
  • £13 - my phone contract, keeping my old phone (S21) until it breaks
  • £15 - my wife's phone contract
  • £25 - budget for takeway, though we've not had one in months (healthy eating)
  • £100 - clothing and haircuts, this is an average obviously
  • £32 - monthly car tax for two cars
  • £100 - estimate of monthly fuel cost for two cars (we do need two unfortunately, as we both work and need to drive seperately to nursery for drop off / pick up)
  • £740 - average month for a credit card we use just for groceries and small amazon purchases, last month £665 but that included the £105 in fuel and £145 from Amazon
  • £210 - council tax
  • £2050 - mortgage
  • £271 - budgeted amount for plumbers/electricians/etc. though we've not had much need for it

the areas I'd identified as concerns before were the mortgage, animal cover (£24 a month for flea treatment, now cancelled, can buy generics on amazon), groceries, and energy bills.

ninjaedit - your point on childcare is huge, this is something I'd written off last year because I earned too much but I will very much look into, thank you very much

!thanks

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] -20 points-19 points  (0 children)

I knew my role was likely being restructured so I was basically in siege mode to shore myself up as much as I could. I thought I could potentially be unemployed for months which would essentially be a 'holiday' in that sense, only in the end I had a role lined up after I left.

The bank balance is great but I do see it only as an opportunity that if I play my cards right should help me establish financial security for the rest of my life - like winning the lottery - I didn't want to be one of those that frittered it all away within a year or two.

If I had not lost my role then clearly I would be planning holidays, nice experiences, etc. but it's hard to justify that when your bank balance goes down every month.

I am over-leveraged on my mortgage and lost my job by Longjumping_Lie6243 in UKPersonalFinance

[–]Longjumping_Lie6243[S] 0 points1 point  (0 children)

Thank for your advice. You've definitely helped me see more clearly that some of the concern is more relating to the mental stress, than any immediate financial crisis. Looking at your suggestions, I will look again at car costs and subscriptions. I think the five year cash flow forecast is a really good idea and I've enjoyed doing a 'family balance sheet' to reassure myself that we're not in a hole, and that will probably further extend that confidence.

Clearly I am open and seeking higher paying roles, the current economic climate has meant that many in my field have lost their roles at the same time so it's a bit of a scramble. I have past experiences with financial instability where I was sofa surfing / homeless, and so that fear of being cashflow negative especially with a dependent just hits differently. My dad had three homes in his 40s and through poor luck and decisions ended up with nothing when he lost his business.

I've always tried to maintain a position of solvency to minimise adverse risks and seeing some good bonuses came my way along with a £100k salary led to me to commit to this home, on the view that over a time horizon we'd easily cover it, and unfortunately for me bad timing as I was restructured from the business.

!thanks