I did it, you guys! On Friday 1st December I picked up the keys to my new place and officially became a real life homeowner. If you need me at any point in the next few weeks, you’ll find me dancing in front of the mirror smugly singing Fifth Harmony’s That’s My Girl to myself.
I suspect the next few weeks will be hella hectic. I’ve got a million boxes to transport to my new place, a ton of furniture to buy, and a bank balance that’s about to be pushed to its absolute limits. On the positive side, I have tons of champagne to drink while I unpack. Swings and roundabouts.
I can’t wait to get my first ever big TV set up (I’ve never owned anything bigger than 18 inches before), light some candles, and pop open a bottle of Aldi-bought bubbly before spending the evening piling clothes into my wardrobe and organising books on my bookcase.
Once I’ve settled in, I plan to get cracking on a bunch of new money goals. I know how crazily boring this might sound considering I’ve spent the last few years manically saving for my own place, but I don’t want to stop there. I want to be comfortable financially and I know that won’t happen if I start living pay cheque to pay cheque without saving any money for the future.
So I’ve decided to set myself the following money goals. Since my finances are going to be tight due to furniture costs etc, I won’t be able to go full speed at any of them, but I’ll be able to chip away at each goal bit by bit.
1. Save for retirement
I got some exciting news from my boss recently – we’re finally being auto-enrolled in a workplace pension! I’ve contacted our new pension provider to let them know what percentage I’d like to contribute and I’m oddly excited to get started. Admittedly, the amount I’m saving is significantly less than the 15% that many pension experts recommend millennials save, but it’s an amount I’m proud of. I feel like I’m challenging myself a little.
2. Stay out of debt
I’ve been incredibly fortunate to get to the age of 27 without accruing any consumer debt, so one of the main challenges I’m going to set myself when I live alone is to stay the hell out of it.
I recently went on a sofa shopping pilgrimage and at least 5 sales people tried to encourage me to sign up for one of their 0% finance deals. I’ve always been extremely debt averse but I must admit I was tempted. I loved the thought of getting my hands on the sofa of my dreams while only paying off a manageable amount each month. Thankfully, I managed to snap myself out of it and remind myself that if I don’t have the money to pay for something in full, I can’t afford it!* I’m better off getting a cheaper sofa from Ikea or a second hand one to tide me over until I can afford a customised one from Harvey’s.
*Okay. I guess this rule could apply to mortgages too, but let’s be realistic here
3. Grow a Fuck Off Fund
The completion date for my apartment has been pushed back so many times that I already have a healthy emergency fund. I originally thought I’d have to deplete it in order to pay for solicitor fees and furniture, but the last few months have enabled me to build it back up again. Something to be grateful for.
However, although it’s a healthy amount that would tide me over for a few months in the event of job loss or a modest unexpected housing expense, I feel like I need to save more money before I can feel as free as I have done over the last few years. Therefore, I’m going to make a fresh start on my Fuck Off Fund! I don’t have a horrible boyfriend I’m desperate to escape from and I don’t hate my job, but since the best time to save a Fuck Off Fund is when you don’t need one, I’m gonna get cracking. Even if I’m only putting £50 a month into it, I’ll be pleased with that.
4. Save money to travel
I’ve not travelled half as much as I would have liked to in the last few years, so I want to make up for lost time and do some exploring!
In September 2018 I’m heading off to Florida for FinCon18, a nerdy conference for money bloggers. I’ve already paid for the tickets to the event, but I still need to book my flights and the hotel won’t be charging me until a few days before I arrive. This means I have some serious saving to do over the next few months. I estimate I’ll need about £1,500 for the flights, hotel and expenses. Wish me luck saving that money cos I’m gonna need it.
Unless I manage to bag myself a doctor, lawyer or sugar daddy on Bumble, I doubt any other trips will be possible in 2018, but from the moment we enter 2019, I wanna start building up a special cash stash that’ll pay for spur-of-the-moment trips abroad.
5. Overpay my mortgage
I recently discovered Money Saving Expert’s mortgage overpayment calculator and I tell you now: it has opened my eyes and made me realise just how destructive interest is.
By throwing extra money at my mortgage, I can save thousands of pounds in interest over the course of my mortgage deal AND become debt-free sooner. I won’t share my exact mortgage figures here, so here’s a made up example:
Let’s imagine I have a £100,000 mortgage over the course of 35 years at an interest rate of 3.5%.
If I was to overpay by £100 a month, I’d save a whopping £25,594 in interest alone. I’d pay off the whole of my mortgage debt 10 years and 11 months earlier than originally planned!
Even overpaying £20 a month would make a difference. I’d pay £7,228 less in interest and would become mortgage-free 3 years earlier than my original term.
To start with, I’ll probably only overpay my mortgage by £10 to £20 a month. In the coming months I’m going to need as much money as possible for furniture and living costs. I’m hopeful that I’ll be earning more money in a year or two and therefore will be able to increase the amount I overpay in future.
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