Tuesday, 7 February 2017

#46 With dream house comes a possible financial nightmare

New house bigger costs.

We’ve now completed the purchase and moved in. The house is fantastic and we’ve already put down a new lick of paint to freshen the whole house up. However, with the new house comes new and increased costs…

Mortgage increases from £797.18 to £1,258.85. Increase of £461.67 per month.

Council tax increases from £145 to £179.88. Increase of £34.88 per month.

I’ve also go to repay underpaid tax on the 2nd or March and April. £470 each month.

We’ve taken out a 24 month 0% loan to pay for new carpets, which is adding an additional £100 per month outlay.

On top of that electricity, gas, water is likely to go up slightly, I’ve added £15 a month for my odds-monkey ‘Matched Betting’ subscription and doubled the monthly savings plan investment into the Global tracker index fund from £50 to £100 per month.

The upshot of all of this change is that IF we stick to our budget (which includes £400 on monthly spending – not already itemised) then we’ll be losing £166.14 per month (excluding the 2 x £470 payments for HMRC and a £400 carpet fitting charge in Feb).

So to now escape the feeling of drowning….

I’m due a £400~ expense return from work which will cover the carpet fitting cost.

I’m anticipating a £3000 bonus from work to be paid in March. It is however not confirmed yet. It was with this in mind the carpet were purchased, perhaps foolishly. We intend to wipe the £100 a month repayments in one go at that point, reducing the monthly arrears to £66.14 per month.

At this point I will just state that that is the plan and the shortfall is intended to be made up by Matched Betting profits. The aim being to pay for the 2 x HMRC re-payments with this also. Which will be a very tall order.

In reality I’m not going to have enough time to make £400 in profits for the first payment so will most likely need to pay this on the credit card and pay back once I have made the profits.

Of the total expenses I contribute a total of £300 per month into my workplace sharesave + global tracker investments, any and all of which can be stopped at any point, so in theory if the worst came to the worst these can be stopped and we should have £150 per month freed up again.

So once carpet and HMRC debts are settled we’ll be £66 down per month but with £300 going into savings. £66 will be easily manageable via Matched Betting.

In the medium term we’ve still got outstanding debt we acquired on our prevous house purchase which totals £281 per month + debt left over from our wedding which is £40~ per month, these at their current rate will be paid off mid-end 2018, which will see us once again move into having around £250 left over each month (still with £300 invested each month).

Two final bits of bad news.

#1 As we’ve been needing every penny lately to complete the house move we’ve stopped paying money into the bills account. So this is going to cause more pain over the coming months with TV licence, car tax and MOTs due in the next 2 months. I have no plan for this currently other than put them on the credit card or move to a monthly repayment plan and begin planning the course back for saving up monthly to cover these.

#2 All of this is based on sticking to the budget. We’ve so far done that once in 19 months.

We may have the house of our dreams but we have a mini financial storm brewing which is going to take all of our energy and determination to ride out and allow us to flourish on the other side.

I’m going to move to a weekly expenses update for the time being to give me extra motivation to stick to it and hold myself accountable.