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newly divorced, please help me assess finances(8 Posts)
Would anyone care to assess/comment on my financial situation? I’m recently divorced with one young DD and now I’m on my own, I’m trying to work out my next move. I would love any advice, or thoughts as I don’t want to make more financial mistakes (ex was terrible with money). I’m 43.
So on the plus side, I’m about to receive £180k as my share of our old house, which I’m planning to use as a deposit on a small house. I don’t have anything spare, but I have a cheap runaround car which is paid for, and I have no debt.
On the down side, I live in an expensive part of the SE, and am looking to buy something for around £310k which is kind of bottom of the rung where I live.
I also have no pension. Only a small amount of savings for emergencies – nothing else – and no real family support.
From October, I intend to get a full time job which will probably pay around 32-34k a year. I also get £6k a year in child maintenance. So according to calculators my net monthly salary will be (basing it on £32k) will be 2070 salary, plus £400 maintenance. That makes a total of £2470.
Out of that, I expect my outgoings to be:
Mortgage £680 a month. Borrowing £130k at 3 per cent over 22 years (I will be 65 when paid off, gulp)
Travel/petrol/ car expenses £140
Childcare after school clubs £200
Direct debits for things like dentist, DD savings account, miscellaneous spending £400
Savings for emergencies e.g. boiler, car £150 a month
Savings for holidays £100 a month
This totals £2320.
It potentially leaves £150 a month. Which can easily be swallowed up by something going wrong I suppose.
Having no pension is a bit terrifying. My only plan at the moment is to sell my house when the mortgage is paid, and downsize to release some capital….
I realise I'm far luckier than some, and I try not to compare myself with my horribly well off siblings. But is there anything I should be doing? Are my figures way off?
Any input would be great, thank you for reading.
Have you been to see a mortgage adviser to check how much you are likely to be able to lend? I presume you are planning on renting until you are past any probationary period at work as you are unlikely to get a mortgage prior to that?
3% interest is likely to increase over the next 22 years. Can you afford a potential increase?
Your going to need stamp duty, solicitors fees, and possibly furniture / white goods etc to come out of the deposit, increasing the mortgage a further 10K
Afterschool looks cheap - what about school holidays?? Thats what messes up our outgoings. How old is your daughter?
Clothes / shoes / uniform etc don't seem to be included.
The �400 looks like a big chunk to just dissapear. Might be worth breaking that down further, even if you don't type it out for us all to see!
Isn't 6K maintaince more like �500/month?
Good point Rockchick. i'll be renting for a while but I hadn't thought of a probationary period. I don't think all lenders insist on this but it's worth checking. Thanks.
Thanks addictedtosugar. Should be ok for furniture and white goods but hadn't factored in holiday care at all. For a holiday club, what sort of costs am I looking at? Stamp duty and fees will add up to around £5k which I suppose I'm thinking of using savings for, then building these up again. But its all looking incredibly tight - fine if nothing hoes wrong but if something happens it's all going to go a bit pear shaped.
Not sure, but looks like your working at £10 for before/after school. I'd guess at least £20 a day. I got childcare once at school to average 333 per month but that was with 2 parents having a week together Xmas and summer, and splitting the rest between us. I live in a cheep part of the country. House prices are about half what your looking at, so I'd check with a local provider.
I have to throw this in there. .. do you need to stay in the same area? I know it's not possible for everyone but sometimes a fresh start in a new (cheaper) area can be really good. I moved from London to South Norfolk following a break up (I left my dds dad) and purchased a house for £250k with my share from the London home. Several years later I needed to downsize again and now live in a beautiful little semi detached house, 3 beds which cost £155k in 2010. We are an hour and a half away from London by train.
Especially as you say you are looking to find a new job (if I've understood that correctly) I'd consider moving further afield. You may be much better off rather than getting tied into a mortgage.
help to buy ISA info.
Also check out the first time buyer offers about.
Are you very rent adverse? What would a rental monthly cost be near you in comparisson to a mortgage interest only payment? If your long term plan is to sell as your pension would you be as well getting your money into stocks and shares ISA's now and having it growing for you. Its a big chunk of money and worth getting some proper financial advise to play thorough different scenarios including your pension.
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