Guys…It’s almost April. The first quarter of 2018 is officially over.
Exactly one week ago, to the hour, it was snowing. Today, I am writing this in my garden with a gin cocktail in hand. Granted, I am well wrapped up, but it is a beautiful day!
I thought this would be as good a time as any to have a look back over my financial goals for the year, since we are fast approaching the July deadline which I’d set on a couple of them.
I have always been well aware that these would change through the year and I’m fine with that, as long as I have a starting point though, I really do need motivation to save money.
My financial wishlist looks something like this…
“Car Insurance: Save £800 by June. I like to pay my car insurance upfront as I get a discount, and I try to keep my monthly outgoings as low as possible. I’m hoping to buy a new car in the next 6 months (see below), which will be insured in my name with OH as a named driver, and he will take out his own policy on our current car. He only just passed his driving test last year and has been on my policy since then, so it’ll be an opportunity to start building his no claims bonus. £800 will more than cover my half of both policies.”
“New car: Save £1000 by July. This is to supplement a fund I already have set aside. I love my car, but it’s pretty old and has been quite unreliable lately. As I was stranded at the side of a motorway at 2am a couple of months back, after which my repair bill totalled about twice what the car is worth, I decided it was time to upgrade. So that was swiftly bumped up the list of priorities!”
I’ve kind of rolled these both in to one now, as I have a general “Car” savings account where both of these funds are going. I’m pretty on track, I’ve got £1500 saved in here in total, but have decided I want to hit £2300 by June now. That will cover my £800ish for insurance, and give me an extra £500 to play around with.
This should be doable, and if I can set aside £300 from April, May & June salaries, I should smash it. We had a bit of a home emergency just before Christmas, and had to replace our entire boiler, which took a huge chunk out of our new car fund. I had resigned myself to the fact that I would have to downgrade my search a bit, but now it’s looking like I may be able to save enough to come fairly close to my original budget by this summer.
Status: £1500/£1800 saved, buzzing!
New goal: Save £2300 by June
“Emergency fund: Contribute £1000 by the end of the year. In an ideal world, this would be more, but I’m almost at the point where a new car IS an emergency!”
On track, I’m currently saving £100 per month into a high interest Regular Saver. I began in December on a 1 year term. By December this year, I will have £1200 + Interest, which I’ll move over to a high interest current account. This will mean it’s always easily accessible, and I can begin the cycle again with the regular saver for next year.
By the end of this year, I will be able to pay a little extra into my emergency fund too, once the dreaded car payment is over and done with! By the end of next year, I would like to see around £4-5k sitting in this pot for my emergency buffer.
Status: £400/£1000 saved, pleased!
“Mortgage Overpayments: Pay an additional £1000 off my mortgage by the end of the year. Again, this really isn’t anywhere near as high as I would like, but the fund I am supplementing for the new car is mostly taken from my mortgage O/P pot! I already pay an additional £110 per month on top of my minimum payment, so my total overpayment will still be over £2k.”
Well, if you read my original post, you’ll be aware I was already reconsidering this one by the time I actually posted the article!
I’m still fairly torn on how to proceed. I haven’t yet made any additional overpayments, but the plan had always been to put this on the backburner until I’d bought my car.
After that, I have the option of diverting £250 per month from my last 4 paychecks directly to my mortgage principal.
So where my second thoughts come in, is that I am unsure if I should be saving this money or making further overpayments on my current mortgage. In the next 5 years, I would like to move out of my apartment and into a bigger house, but I would love to not have to sell my apartment to do this. With this in mind, if anyone has any ideas on how is best to proceed, please do get in touch!
If I want to buy without selling my current property, should I be saving these extra overpayments to go towards a second mortgage deposit rather than paying off my current mortgage? I have got a fixed term rate until 2022, which is fairly low (lower than the rate on a decent savings account).
Status: £0/£1000, baffled.
I am still keeping an eye on stocks and shares ISAs, and have been reading loads on how to start investing, I want to get started next year but will realistically only have small sums of money to play with. I’d like to be able to start with around £50 a month, and increase gradually as I hit my other saving milestones.
Again, if anyone has any recommended reading on this subject, please send it my way!
How are you getting on with your goals for the year? I had been feeling a bit demotivated over the last couple of weeks, but breaking it down and looking at the smaller picture has really helped me see that I am actually doing pretty well. Keeping my Money Diaries has also helped more than I thought it would, it’s given me a real insight into where the hell my money goes every month.