Are people who own their own homes or have a mortgage worried about bills?

[gotelltheoldmandowntheroad]

If you have a mortgage or own a house outright, does it usually come along with being okay financially?

Do you all have thousands in the bank? I assume you do because things come up like repairs and services that can be expensive.

So with the energy hikes and other cost of living issues, what happens? Do you know you will have enough to cover the bills? Or are you high earners along with owning?

If you couldn't pay your utility bills would that mean your house would be under threat?

I know nothing about it all as no one in my family has ever had a mortgage.

In all the years we had a mortgage, we certainly didn't have money in the bank. We taught ourselves and carried out ALL property repairs, maintenance, upgrading and decoration ourselves, because we couldn't afford to employ tradesmen. We earned our way free of mortgage by sheer hard work and budget economy. Every penny went into the property and mortgage and family; so we arrived at "mortgage free" with no savings at all. And no credit debt either, because we always lived within our very tight budget. Back in the 1970's, when we couldn't afford the gas bill, we just turned off the boiler, had no heating, bought more clothes from jumblesales, and bathed standing in a washing up bowl. No problem at all to me; I was brought up in a house with no plumbing at all (or heating).

Once we were debt free, THEN we started building assets ; same mindset (learn, earn, save).Our next target was early retirement in financial comfort (reached 20 years ago). We have enough money and a very comfortable home adapted to our age and needs. Plus, we make an effort at sustaining physical health and fitness (free).

We already know how to live very comfortably with no heating, on a very cheap nutritious diet, and entertain ourselves indefinitely, without going crazy. So do many of our generation.

If I have advice to younger people today, it's
A) adopt "I can do this" mindset and adaptability PDQ, because you're going to need it
B) look after your family's physical health (diet, sleep, fresh air, excercise)
C) A + B supports emotional resilience and mental health.

@AluckyEllie

Not wishing to sound pedantic and haven't read past your post, so others may have addressed this already, but if you got your mortgage in 2018, you won't be needing to remortgage in 2024, you'll just come off your fixed rate onto SV if you don't choose another fixed Rate. You could remortgage when your fix runs out (without any early repayment fees) if you wanted & if you could get a better deal elsewhere, but you wouldn't HAVE to remortgage.

i think you're more sensible rather than fortunate. With maybe a bit of fortune in being in the careers you're in, at these times.

@2bazookas it's not really the same comparing buying a house 50 yrs ago to now.

Also paying down the mortgage to be mortgage free isn't necessarily the best option if you have excess money.

Op I'm not sure what planet or decade you are living in but you sound very lucky to live in a huge house with lifetime tenancy for less than £400 a month. You also sound just a little bit smug and judgemental. You've never had to pay more than £500 a month rent anywhere? And your outgoings are low enough that you could.just do anyone of the low paid jobs out there. And why aren't people with mortgages just as sensible as you? This simply isn't the case for most people. There is not an endless supply of social housing so most people have to privately rent which is expensive and asks security or they bite the bullet and get a mortgage. Either way many people will be paying double or triple what you do per month and cannot just walk into any old job, they will need a certain income. Many people will have young children be part time and this eat into savings and costs. So yes of course people will be worried about bills. During previous recessions Many homeowners eventually lost their homes, it takes time for the debts to build up but yes this is a reality for many people.

whalleyt "buying a house to 50 years ago"

I disagree

You are talking complete rubbish !

People still needed a deposit & a wage for a mortgage
Bills to pay
Transport to pay
Children to pay for
Food to pap for
Very little money left over for savings

Whalley "paying down the mortgage to be mortgage free"

I disagree

Being mortgage free is brilliant !

Less stress to pay the mortgage each month

Money to spend on other things or save

Less concerns about being made redundant or poor health

Can possibly downsize or relocate

Can retire

Bill priority is mortgage then council tax then utilities. That's because losing your house is a legal nightmare and you can be imprisoned for not paying council tax. We have a child under 5, so they can't cap our water or electricity. Not that I wouldn't pay them.

I'm really worried about interest rates going up as we're due to remortgage next year and likely to pay an extra £300 on the mortgage which is going to be crippling.

Repairs aren't cheap and sometimes they have to wait.

@Dog1naRocket

You are talking complete rubbish !

yes you're right, it hasn't got harder to buy a house 😆 feel free to post statistics to back up your point...

@Dog1naRocket I think you misunderstood my post. I didn't say being mortgage free wasn't a good thing just it's not always the best use of excess money.

Some interesting advice I heard, if you are struggling with utilities - pay your water bill last. The water authority cannot cut off your water supply if you don't pay (as it is a fundamental right).

Re pp question on green targets.

When we were on social security but homeowners we got a new energy efficient heating system I stalled for free to meet energy targets. Another big plus of home ownership!

Honestly owning a home has changed my life. When I was unemployed I could use the equity in my home against cheap debt to retrain for a new career that I then made a lot of money from.

If I'd have been in social housing I'd have been stuck in a poverty trap.

Always pay mortgage first.

Yes, we’re worried about rising costs. We’re fairly high earners but our mortgage is very high (modest house, but expensive part of the country), and we have a big childcare bill- we don’t have much leftover.

We own outright and are early retired. Yes, we do have thousands - most of it is not in the bank, it is in ISA’s and pension schemes that we paid into over decades, plus we have partial occupational pensions which we are not yet drawing.

We have zero taxable income, because all the income we do have is currently within either an ISA or pension scheme, so not liable to tax.

The ‘income’ we use to pay our bills is the amount we have chosen to withdraw from our investments every month - an amount that we thought would enable us to live comfortably but not extravagantly, until we are receiving all our pensions, at which point we would stop drawing a regular income from the investments.

However, along comes the current economic situation. Bills are rising, so we are having to try harder to stay within our monthly amount - although we could choose to increase it. But the value of our investments has gone down thanks to COVID, Ukraine, international energy crisis. The length of time over which we can draw from that pot before it runs out is being squeezed at both ends. Plus, pensions are inflation-linked, but only up to a certain limit, in our case either 2.5% or 5%. So a long period of inflation would significantly erode the buying power of our pensions.

We are a long, long way from not being able to pay our bills. However, it is not as simple as saying that if you own outright and have thousands in the bank, you will definitely be OK. You have to manage the assets you have and not go through them too quickly, or you could find yourself in trouble.

Re green targets - these tend to be imposed on builders and landlords, but not homeowners. Builders have to comply with building regs, which are updated periodically. Landlords can’t let a house unless the EPC is at least C.

The only example I can think of when homeowners have to do something is get an EPC if they want to sell the house. Also if they want to make any modifications they will have to comply with current building regs.

er, I have a mortgage. I’m still anxious about bills. Paying £800+ Mortgage doesn’t make my mortgage easier.

DH is a high earner and we have less than half the mortgage left to pay. I asked him if we should be concerned about energy prices (detached home, it will go up a lot this winter). He said that we should be very, very concerned about the people who are already living paycheck to paycheck. We're still saving several thousands a month.

I don't know what will happen to people that have nothing left at the end of the month now in summer.

Oh and we're not in the UK, so financially apparantly more stable than you guys.

Hoping for a warm winter.

"If you have a mortgage or own a house outright, does it usually come along with being okay financially?"

Not necessarily. While it means no rent or mortgage, a lot of people downsize their lives accordingly (such as moving to a remote area and retiring), so increased expenses might mean needing to go back to work, take on more hours, or still cutting back like anyone else.

With that said, I definitely recommend being mortgage free.

I wouldn't ask this question on Mumsnet, everyone's a judgemental so and so who thinks you need to have a spare few grand in the bank to own a house or you're being wasteful and overextending yourself....despite the average house being nearly 10x the average salary 🙃

I think it's better in the long run to own a property as eventually the mortgage will be paid off. If you have to cover rent from a pension that could be quite worrying and difficult to do.

But if you've got a cheap secure tenancy op then I think you're better off with that.

We've got a mortgage but it will be paid off in 5 years. We've consistently overpaid to get it down as my H may not be able to work full time in a few years. The mortgage is large but I'm thankful we did not borrow £500k which is what the bank offered is when we bought this house 9 years ago.

True; it was much harder for women to get a mortgage back then, lenders set a far higher bar and taking out life and property insurance was compulsory. For my first purchase the leder required a 25% deposit, plus proof of my savings record with them. During later purchases we paid 16 % mortgage interest rate.
We never enjoyed today's low interest rates.

I’ve often wondered how people pay rent when they are retired and on a pension.

Anyone relying solely on the state pension plus pension credit (a top up for those who haven't saved into a private pension) is also entitled to housing benefit. So it's a myth that anyone is surviving solely on the state pension.

I got two houses. Own with small mortgage only £30k left and the other one is buy to let.

my husband is consider high earner (but still way below 100k). We dont have much saving because we just finished renovating our house. And yes we are very worried about bills. We are fortunate we still can pay our bills but definitely need to think and managing our expenses more.

We never enjoyed today's low interest rates.

lol

As we paid down our mortgage, we continued to invest in the house: double glazing, solar, insulation, new heating, thick curtains, etc etc, to future proof against fuel price inflation at a time when retired we'd have low income.
We are currently considering water storage, collecting from the roof, as we expect water bills to rise because the water co will say 'oh dear this drought has caused so many problems to the infrastructure we have to increase prices ' hahaha 3 years to fix a leak in our road! If Thames Water fixed their leak issue there'd still be plenty of water.

We hope we can still afford the house by the time we retire.