When we started our journey to financial freedom and early retirement, finances in the UK were steady. Fast forward a few years and everyone is feeling the pinch as the UK is facing a pretty harsh financial turmoil and it has put a little hiccup in our plans.
Thankfully at the moment, there is not a huge impact on us other than the rising food and energy bills as the usage of our car is minimal and thankfully a year ago we locked our mortgage onto a new 5-year deal, which has given us such a comfort blanket amidst these rising costs.
With the housing market starting to look a little shaky though, we are having to rethink our plans a little.
I would still 100% like to move as soon as possible into our forever home out in the country, however, I am realistic that now is not the time to achieve this. With the current mortgage rates over 5% more than we are currently paying, it does not make any sense for us to increase our mortgage and move it onto the higher rates. It feels like we would be going against everything we have worked so hard to put into place by doing that. So, for the time being, we are sticking to where we are.
In the meantime, we are going to shift our debt clearance to the unsecured debts with variable interest rates, I don’t want to pay more interest than I really have to, the more I pay off the capital the better! Once we have got this down, it will be back to smashing out the mortgage, though I would like to also start an emergency fund pot and a moving fund pot, ready for when we need them.
Whilst things are tough, we are just going to take it month to month. If we have a month where we are more comfortable than others, we will work on getting that straight on debt. Then if it is a little tougher, we will hold back on making the payments.
I am not sure I saw the whole collapse coming as it has done, I don’t think anyone did.
We all knew that things would change with everything that has gone on this year but I just didn’t see the market crash coming or the mortgage rates jumping to the amount they have. It is just frustrating that we had just positioned ourselves into a good place that we could have potentially moved in the next 18 months to 2 years, however, we still have a roof over our head, a job and money to put food on the table so for that I will always be grateful.
If you are worried about your finances during this turmoil, take a moment to have a look through your income and expenditure to see what you can do to make it go that little bit further. This post is great on ways to cut the spending on the food budget, it might not save you as much as the increase but every bit back in your pocket is worth it. If you are finding the cost of fuel and travel pushing your budget to the limit, I wrote this post on how to deal with the rising cost of commuting, you may find that it helps get you back on track.
For those of us that may have hoarded things that we don’t need or use, check out this post on the best places to sell your unwanted items. I have a week off soon and I plan to use that to go through our loft and under the bed to make sure we clear out what we are not using! Something back in my bank is better than sitting in the loft gathering dust and no longer being used.
