Friday, 11 January 2013

Frugal Friday...

When I first woke up to the positives of being financially savvy, and starting to overpay the mortgage, I posted regularly on the "Mortgage free wannabe" section of a well known and deservedly popular website's forums. I've sung the praises of this particular site (and its forums) regularly, and shall continue to do so, but ironically, this particular forum was very nearly the cause of me giving up before I had even really started.

We initially started by saving money to pay off a car loan early, and overpaying tiny bits - literally £10 a month to start with - on the mortgage. Initially the forum board and the regular posters on there proved to be a great source of support and inspiration - many people were sacrificing absolutely everything to put every penny they could to their mortgage. there were incredible stories of people paying down their mortgages in 3 years...but gradually I started to feel a lingering sense of questioning as to why I was there. I was still taking holidays, going out with friends, we were having takeaway occasionally and the bulk of the money we were saving was going to pay off the loan in the short term, not the mortgage. Even though the overpayments were gradually creeping up - £50 per month, £70, £100 - I still felt that slight awkwardness, I wasn't *quite* dedicated enough to be playing with the big boys - I was still having treats and enjoying life so clearly I didn't really have quite the same enthusiasm for the task at hand as others did. I began to feel that maybe that unspoken question was valid - perhaps I really DIDN'T have the determination to see it through?

A friend reminded me of a couple of pertinent sayings "Slowly wins the race" and "there's more ways than one to skin a cat" - and both of these hold extremely true in the world of frugaldom and mortgage overpayments! It's easy to get terrified when faced with a group of people who are all throwing more money every month at their mortgage than you even earn - but just because you can't do the same doesn't mean that you're not making a difference. Even a £10 per month overpayment on a mortgage over 25 years will knock a bit of time - and a bit of interest, more importantly - off the final due date. Remember also it's important to try to get some savings behind you - budget carefully for not only regular monthly outgoings, but also for "big one-offs" like insurances, car servicing etc. Then save an "emergency fund" - ideally of 3 - 6 months money - so that if the worst should happen and someone ends up not earning for a while, you can still pay the bills. Then, and only then, start working on chipping away at "the big one".

5 Easy ways of paying a bit more to your mortgage:
- In February & March most of us pay no council tax or water rates - pay this as a lump-sum to your mortgage in these months instead.
- Challenge yourself to a "Frugal Month" - I'm going to be doing this in February. Pay whatever is left in the current account at the end of it to the mortgage.
- Set yourself a monthly grocery budget and then see how much you can save of that - pay whatever is saved to the mortgage.
- Search out a cheaper deal on gas, electricity, TV or telephone - pay the amount that your monthly Direct Debit reduces by to your mortgage as a regular overpayment. By the time you've done all of them this can really add up!
- Save to be able to pay insurances annually rather than in instalments - typically you pay £1.50 - £5 per month extra to spread payments across the year - so that saving can be added to your mortgage pot too.

We have no plans for sacrificing our annual trip to the Hebrides, our second car, cheery trips off with friends or occasional nights out for the sake of scrimping, saving and throwing every last penny at the mortgage. Our view is that you never know what is around the next corner, so we will continue to have fun today "just in case" there is no tomorrow. If anything happens to either of us then the mortgage is paid off in any case - we have adequate insurance to be certain of that - and where there are things that we both want to do, see or visit, we'll jolly well do, see and visit them as and when we get the chance - how sad to have to go to one of those places that was on both of our lists, alone, at some unspecified time in the future, wishing that we had gone sooner, while the other was still there to enjoy it...

Most importantly, if you are now that person who is managing to OP a dribble at a time, then brilliant - well done you! Don't let anyone tell you that it's not worth it unless you are paying a fortune, or that because you still want to have the odd treat, a weekend away, or a nice meal that you haven't had to cook occasionally, you're not doing the right thing. For YOU, your way might well be the right thing - for someone else, their way is their choice. Each to their own - personally, I'll go for having fun and enjoying life!

Remember - As much as you can is absolutely fine!


(What was that? The photos? Oh, they are "just enough" to get the idea of what they might be of...check back in a couple of days to see "The bigger picture")

Others joining in with Friday Frugality this week are:
A Cheerful Living Adventure
Cwtch Corner


Pat Machin said...

That's why I stopped visiting that site. Very, very useful for info and also to get you going in the first place.

BUT, I wanted to enjoy life now as well as later and life is uncertain and I do think the things you regret when it is too late are the things you didn't do, rather than those you did!

Anonymous said...

I've not visited the website, but we do what we do for one reason only - because WE want to. I wholeheartedly agree with your sentiment in this post. We have a holiday each year, we have the occasional bag of chips out. We also cut corners and are frugal where we can be and love that just as much. Life is about balance, and we only get one go at it. Enjoy each step. x x x

cheri said...

Great points. I know the site that you talk of. I agree with Pat. I stopped visiting because, whilst I learned lots, I also began to feel "poor in mind" and life is for living today. I am all for saving and being frugal to an extent but you know anything can happen and the last thing I want is to say in my final minutes is "well I enjoyed my life" rather than "well, I had a crap life but there is lots of money in the house and the bank for others to enjoy"

Robyn said...

Don't get me wrong, I LOVE the MSE site, and the forum, and do still visit regularly, and in fairness it's far from the only site out there that might give you the impression that unless you're doing "everything" then you're failing.
Pat, you're so right about regrets - I'd far rather live without them, so will continue to live it to the fullest now, while also working to the future!
FM - that's exactly it isn't it - Treats don't have to cost thousands, it can be all about the little things - as you say, what's nicer than a hot salty bag of chips eaten with someone you love, in a fantastic place?!
Cheri - that phrase "poor in mind" sums it up brilliantly - who wants to feel like that for goodness sake!

Scarlet said...

Another fab Frugal Friday post. I've never read the MSE forums, but know that there are bloggers out there who seem to have the same ethos as the people you have mentioned. They seem to revel in wearing a hair shirt, but there are times when things don't quite add up- maybe they're not quite so saintly regarding their spending/ frugality as they would have people believe. Despite our low income we still have a holiday each year. Yes, we could put that money towards a larger mortgage overpayment, but I'm almost 48 and have a heart condition and my Dad died at 55 of a heart attack. Those things tend to colour one's judgement. I'd like to think that we have the balance right - enjoying the day as much as possible whilst still keeping an eye on the future, should we be lucky enough to have one.

Robyn said...

That is really too young an age to lose a parent at, isn't it - and provides a good reminder of why exactly we *should* make the most of the lives we've been given.

We could have sacrificed our Hebrides trips for the last few years to get the mortgage gone quicker, but as one of the reasons for wanting it paid off it to enable a move across there in the future, we're seeing it as "research". The weekends away, well, those are obviously researching other know, just in case! ;-)

Anonymous said...

I used to visit this board too but then decided to blog instead. I would rather take longer to pay off the mortgage than give up travel. It's all about balance really.

Great post :)

Sue said...

An absolutely brilliant Blog post - I agree entirely.

We do the best we can and when we're able to we do save every single penny but sometimes there comes a day when we really want to enjoy each others company and have a treat, and even if it is only a bag of chips or a plate of pasta in our favorite eating place with a sneaky glass of wine, and when these days come we give into them and luxuriate in each others company, and usually we come back to 'frugality' rejuvenated and wanting to 'get stuck in' all the more.

We only have one life we need to treasure it and the sometimes magic moments in it.

Sue xx

Robyn said...

Laura & Sue, absolutely right about the balance thing - I get so annoyed when I see the "All or nothing merchants" posting with their viewpoints of "If you're not living a life of poverty in order to OP then you're failing" nonsense. Especially when a lot of the time, as Scarlet mentioned, their sums simply don't add up, and you KNOW full well that what they are saying is not the full picture!

Miss Piggy Bank said...

Hi Robyn, I completely agree with what you say. Life is for living, you never know what is around the corner. Last year a dear colleague of mine died very suddenly aged 50. Other people I know of have died with a year of retiring. Life is about balance and enjoying what you have. I am overpaying my mortgage now but I also do still have treats. Other bloggers are able to overpay/save money almost equivalent to our household income. Its all about choice, everyones is different and personal to them but I think bloggers can sometimes come across as competitive. Who has saved the most etc etc. Sometimes I also take it with a pinch of salt as things don't add up.

Robyn said...

Yes, precisely MPB - it annoys me too when you see people tripping themselves up over things they've said previously!
It was a friend of mine dying just a few months after taking early retirement some years back that made me conscious of the need not to put things off on the basis that "we'll do that when..."