Five Pence Piece » Family

Buying A House?

Lee — Thu, 15 Sep 2011 11:24:54 +0000

A Preponderance

If you’ve been reading my blog from the beginning you may recall my continual struggle with the idea of whether to continue renting, or to look to buy a house. I’m still no further forward with that internal argument 2 years later, but my girlfriend planted the seed again yesterday, opening up the whole can of worms all over again.

Essentially we are looking for somewhere to live together that is close to our respective places of employment (perhaps so we can get rid of one car, then?), that isn’t hugely expensive, that is nice, and is relatively quiet. A tall order in a big metropolitan city. We have been half-heartedly looking around for a couple of months now and we have seen a few places that would tick those boxes. Unfortunately every time we have enquired, the property has already been let.

A Spanner In the Works

Last night my girlfriend mentioned her parents have put away some money for her to use as a deposit (trust fund style) to buy, rather than rent. This has thrown the discussion and plans into disarray somewhat. Do we rent? Do we buy? Do we rent somewhere now together, and look to buy after that?

Looking back (1) at some posts (2) I’ve made before on the subject, I’m coming round to the idea that buying may not be such a bad idea any longer. The economy is faltering once more, and there are some desperate sellers out there. We both have excellent credit ratings, and my pre-approved mortgage offer still exists with my bank – although what value it is now at requires a personal appointment to discover.

Do Your Sums

Hundreds of thousands of people are no doubt in this exact same position. The path to clarity is to do your sums as a couple. What are your outgoings (read ‘Know What You Owe‘ for a good starting point in working this out), and what are your employment prospects like? This is a challenging economy; would a drastic change in one of your income streams cause you pain later on? Even with a mortgage, are you certain you’d still be spending less than you earned – even if interest rates increased? Remember in the 80′s recession interest rates shot up to 15-odd percent, causing pain up and down the country.

If you find you will still be comfortable, then what is to stop you? Ultimately house prices may be over-inflated, but there is nothing to say or evidence particularly that this will ever truly resolve itself to the levels I and others have previously predicted. Even during the recession and the years following it, house prices have remained essentially unchanged (but they haven’t increased much either).

A Watched Pot Never Boils

I’m not suggesting you throw caution to the wind. But with careful planning and the right property, you could escape entirely unscathed. I have previously advocated waiting for the massive market correction I and many others feel is long overdue – but 3 years later, it still shows no sign of coming despite conditions being ripe for it to do so.

Sometimes, despite all financial sense, you just have to go with what ‘feels’ right.

My girlfriend and I will look to buy at some point. For now (for speed more than anything), we will continue to look to rent initially. Are you in a similar position? Or have you recently had a similar discussion with yourself? I’d love to see you in the comments!

p.s. on an entirely unrelated note, for anyone who is resident in Sussex and likes photography, you might be interested in the photograph I took a few days ago of Hove’s West Pier during Stormy Tuesday!

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5 Things I Will Do When Debt Free

Lee — Mon, 19 Oct 2009 06:36:59 +0000

I’m still feeling under the weather, courtesy of my vaccination on Friday. I very rarely get ill, so I always feel as though I’ve been hit by a truck when it happens! Runny nose, aching muscles and joints, thick head and a general lack of drive to do anything. In short, not fun.

But, one advantage is I have not done all that much the last couple of days. I have spent most of today in fact thinking about what I am going to do when I am finally debt free in the next month or so.

A few years ago I would have splurged on all kinds of ‘toys’, new gadgets, a big expensive holiday and so forth. The last 10 months has disconnected me almost entirely from the consumerism that got me here in the first place.

So what will I do when I am debt free?

I will treat myself to Burger King

As silly as this sounds, I have not eaten out for myself at all this year. I have been frugal in my food shopping, dining and cooking experiences, and just once I would like to say “to hell with it” and go have some fun in a culinary sense. I can be fairly certain to walk away pretty full and not spend more than £10 for the privilege.

It’s hardly haute cuisine, but it has been something I have been dreaming about for the best part of a year and it will be a major expense for me: Ordinarily £10 will feed me for a week!

I will pad out my Emergency Fund

I have never had one, and I know I need one. Especially now that the Grim Reaper has been trying the doors at work. I think a reasonable starting point would be £1,000 – and work upwards towards 12 months of expenses from there. Currently my emergency fund is £70, and that is a bit of a cruel joke in every sense.

I will take my parents out to dinner

My mum and step-dad have been my rock so many times over the years, but they saved me this year. They put me up – at great inconvenience to themselves – rent free, to help me get out of the dark place that a falling-apart marriage creates. Living rent-free has enabled my “Get Out of Debt In A Year” goal to be a real possibility and not some pipe-dream. Thank you, guys.

It won’t be cheap. While my step-dad will eat just about anything (with the exception of carrots), Mum is allergic to a lot of foods. I need to do some research to find a good setting that can cater for this.

I will open my 2009/2010 Cash ISA

I’ve been singing the praises of ISA‘s on this blog quite a lot. When I am out of debt, it’ll be time to heed my own advice and go and get one!

I will take a short frugal holiday

I need a holiday. I totted up that I have worked an entire extra month in just 9 months so far at work in my ‘debt payoff’ journey, and it has left me feeling old. A short holiday will be nice, just 4 or 5 days will be fine. Somewhere relaxing, somewhere I can just sit back and unwind. Somewhere I can soak up a bit of culture and a bit of alcohol. I will pay in cash, of course!

Should I expand this list somehow? Have I missed a blindingly obvious “when debt free” todo?

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Frugal Friday! 8 Christmas Gift Ideas

Lee — Fri, 16 Oct 2009 07:06:42 +0000

Christmas is fast approaching! There are, as of today, 70 days until The Big Day.

If your family celebrates Christmas, it can be a testing time for your finances. Even with a relatively small family, it is amazing how quickly the cost of gifts can mount up. Throw in buying for friends, distant relatives, distant cousins 18 times removed, and you quickly end up potentially spending hundreds upon hundreds of pounds.

If you have not begun preparing for the cost of this, it inevitably ends up being charged on your flexible friend.

It doesn’t have to be this way.

Even if you cannot get away with token presents, you do not have to spend the earth on giving to others. Some of the best presents can be the cheapest, and this Frugal Friday explores some of the options available to those of us who want to give thoughtful, meaningful gifts at Christmas without having to take out a second mortgage to achieve it.

8 Christmas Gift Ideas

… That won’t break the piggy bank.

Gift Certificates

Buying for some people can be a nightmare – take my step-father as an example. The man has everything he wants or needs in life, so what do you buy someone in that position? Find their weakness.

His weakness is model trains; the loft space of their home is entirely devoted to his railroad tracks. To save buying him something he doesn’t want or need, the best gift for him is a gift certificate from our local model railway shop. That way he can buy what he needs for his next expansion plan – and not have to exchange any money to do so.

Be careful though: Some gift certificates/cards expire if not used in a certain period. If the business you buy them from goes bust, you also have little to no comeback.

Amazon Wish Lists

A lot of people in my family have Amazon wish lists. If you want to be certain of buying them a gift they will appreciate and they live some distance away, have a browse through their wish list. You can likely find a reasonably cheap “Want” that can be fulfilled, and it’ll still be extremely meaningful to them to know it came from you. Amazon will even wrap it and ship it for you!

To get started, head on over to your local Amazon and click “Gifts & Wish Lists” or similar. You can then search for Wish Lists by name or email address. This may get you to their list without them even realising you have something off of their list in mind. Perfect!

If anyone wants to buy me something for Christmas, you can find mine here

Scented Candles

I love candles, and if you shop around, you can find some brilliant scents for very little. A few years ago I bought my wife a “Europe Candle Collection” that had scents of different European cities. They smelled divine when burned, but also looked amazing as well.

The price? £15 for 10.

Books

Almost everyone enjoys a good book, and if you cannot find anything on their Wish List, ask someone close to them for ideas. The danger is buying them a book they already have, so some collaboration is required. If you know the person really well then this becomes less of an issue – buying something they will really enjoy but that might be outside their usual own-purchase window.

Failing that, you can always fall back to a gift certificate from Amazon or their local book store.

A LoveFilm Membership

If their thing is more along the lines of good movies, then a LoveFilm (or other online DVD subscription service) is a brilliant gift. They can load it up with the movies they want, and watch them without paying a penny. This is much better value (for you and them!) than buying ‘a DVD’ or ‘a boxset’.

Home Made Cookies

If you are a whiz in the kitchen, some home-made goodies will go down a treat. For the sake of the cost of the ingredients involved, you can make someone smile from ear to ear for literally pennies.

Receiving such gifts, knowing the loving care that went into making them, makes the cost irrelevant to the receiver.

Gourmet Coffee

For the amount of coffee you usually get in these, they are hellishly expensive – but we are really talking about a whole gift for under £10 here. If the person you are buying for is rarely without a mug of coffee in their hand, this gift will be perfect.

Expensive Undergarments

Male or female, adult, child or somewhere in between – there is always the need for socks and underpants. Ordinarily I am a ‘utility’ kind of purchaser in this department. When someone buys me some expensive stuff for Christmas, I really am thankful. They feel good, look good, and last so much longer.

You will still spend out less than £10.