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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To ask how to come to terms with this financial situation

209 replies

Justcaant · 20/11/2024 07:39

I’m 40 soon and last year separated from a long term partner. I now have our DD all week and he has her EOW. CMS is sorted but the real issue is that I now own a home alone (we rented previously as were saving for a house).

I have a 240k mortgage to pay off. I may never actually pay it off. I feel completely financially stuck. I am constantly worried about my job and bills. I have 1.5k in savings and try and add 100 a month but it’s hard. I never thought at 40 I would be in this situation. My parents are reasonably well off and I was brought up in a way that is now totally different to my daughter and I feel terrible about that too. I keep thinking I will be old and alone and unable to pay bills so end up on the streets. I am waking every day at 3am for some reason and just going over and over this and there is no way out. I wish I had made better financial decisions when younger and now it’s too late to fix it. How do I cope with this and accept where I am? I don’t want this to rub off on our child.

OP posts:
Original poster
Justcaant · 20/11/2024 08:24

Thank you, everything feels so daunting right now and I just feel totally and utterly alone with it all. Good suggestions and I will try and go to the gp as I know this is rooted in anxiety.

OP posts:
Haghdhdhhdh · 20/11/2024 08:25

Can you get a lodger? Not a great option and may be impossible with disruption. Depends a lot on house layout.

if I had a room with an en-suite and could find a female professional would seriously consider this.

betterangels · 20/11/2024 08:25

IVFmumoftwo · 20/11/2024 07:56

If you can save and own your own home that is better than many.

Yeah, you need to get some perspective.

Gardendiary · 20/11/2024 08:26

Justcaant · 20/11/2024 07:52

@DieStrassensindimmernass I could downsize slightly but to be honest the houses are not much cheaper. This is only a three bed and has one box room so more a two bed. I can’t leave the area really due to the school as dd is already very settled in

I know you can’t downsize now, but as a future plan when dd is older could you go to a different area and buy a two bed and reduce the mortgage?
I know how you feel btw, I’ve got myself into a hole where I’m on a low income with virtually no pension which I can’t really change due to having a disabled child. I have moments where it completely occupies my thoughts, especially as friends are in very different positions and I also had a more financially secure childhood.

Antsy123 · 20/11/2024 08:27

Justcaant · 20/11/2024 08:04

I don’t feel I can rely on inheritance, their home is 900k, there are 2 of us siblings and any tax will surely wipe out anything that could come to us. My parents also want to travel and do things so it may be there is nothing there anyway.

Why would inheritance tax wipe it out? It sounds like it’s below the inheritance tax threshold anyway and even if not, inheritance tax is only ever a maximum of 40% over the threshold. That would leave £540k on a £900k estate (it would actually be much less than that because you only pay it over the threshold) which leaves you and your brother at least £270k each which would pay of your mortgage.

Blondeshavemorefun · 20/11/2024 08:29

I bet it's hard being in own and all bills mortgage suddenly being paid by you

But

You own your own home and you can save a little each month

Can you remortgage for a lower rate /longer term to lower mortgage now

Long term worst you sell and buy a flat when older and downsize

romdowa · 20/11/2024 08:30

Isn't there a type of insurance you can take out that will pay you in the event of illness? Would something like that put your mind at ease?

AntiHop · 20/11/2024 08:30

How long is your mortgage term?

Pickled21 · 20/11/2024 08:31

I'd speak to your gp as you sound very anxious and may need help be it counselling or medication. I'd then speak to a financial advisor or speak to citizens advice about how you can better your situation. It also sounds like you are grieving for your lost relationship and I'd work to come to terms with that. You are wise to realise that it's never a good idea to bank on an inheritance. There are ways you can improve your situation however you won't believe it until you hear it for yourself and get the help you need to deal with the anxiety.

PinoGrejioh · 20/11/2024 08:32

You own a 3 bed house, you have a job, a small amount of savings, a happy daughter, you're doing fine!

Stop projecting all these 'what ifs' and enjoy what you have instead of focusing on what you don't.

DoodleDig · 20/11/2024 08:32

Justcaant · 20/11/2024 07:53

I don’t understand what you do though if you can’t pay your mortgage or your rent and you are old? What happens to you? Would you be homeless? I can’t see how I will be able to fund everything myself into old age

In 20 years time your DD probably won't be living with you and you won't need a 3-bedroom house. It will have gone up in value. You can sell it and get something smaller, maybe a one-bedroom property. You'll be Inna very good position.There's no need to panic. If you are currently able to save each month, even only £60, then you are doing fine.
It might even be worth looking at 2-bedroom properties in the same area that you are in now if it might make your monthly outgoings less.

MrsCarson · 20/11/2024 08:33

You don't have to pay forever till it's paid off, once Dd is grown and moved out, you can sell and buy something smaller. I would really like a flat one day if I'm ever alone.

GOODCAT · 20/11/2024 08:34

Focus on the positives, you are providing a home for your daughter. You do have a roof over your head. Things are tight but that is normal and the financial pressure will lessen when your daughter becomes an adult.

To move forwards focus on the things that are fun, try new things, none of which have to cost you money. Make life into an adventure. If this doesn't feel like you, pretend you are someone else who does have that view and live their life for a bit.

Also focus on today, today you have a daughter, you have a roof over your heads, you have food, your outgoings don't exceed what you have coming in.

HowYouSpellingThat10 · 20/11/2024 08:34

Justcaant · 20/11/2024 07:55

@Jellycatspyjamas i get through the month just about but there’s no buffer. Last month I only saved 60. It makes no difference to anything. I can manage but the stress is awful and I don’t know how I will cope with this now forever more

But every year your mortgage will get smaller compared to your income (assuming you are not on a 1.5% deal coming to an end).

You now look at people who bought 20 years ago and see how tiny their mortgages are. But likely when they took them out they felt like you.

With inflation in 10 years time your mortgage will be a smaller proportion of outgoings.

I know it's easier said than done but try not to go too far into the future. Lots of different things could happen between now and then.

Do you have a secure home? Is your daughter happy?

You could post a statement of affairs on money saving expert. People there are good at helping to shave costs.

Yes it's hard now but you have just been through a massive change. Give it time to settle.

TheSandgroper · 20/11/2024 08:34

Find out if you can make fortnightly payments instead of monthly. It really makes a difference. https://www.canstar.com.au/home-loans/weekly-fortnightly-monthly-repayments-better/

VeterinaryCareAssistant · 20/11/2024 08:35

My violin is playing for you, a homeowner.

OolongTeaDrinker · 20/11/2024 08:36

Justcaant · 20/11/2024 08:04

I don’t feel I can rely on inheritance, their home is 900k, there are 2 of us siblings and any tax will surely wipe out anything that could come to us. My parents also want to travel and do things so it may be there is nothing there anyway.

I don’t know where you are getting your info from but your parents estate will only be taxed for any amount over £650k, so why do you think the whole £900k will all be swallowed up by tax?

I think you need to start focussing more on the present. Sure, you may never pay off your mortgage on your own, but one day you may have built up enough equity to sell your house and downsize to a garden flat with a smaller or even no mortgage.

Millions of people will never be able to own a house or have a child - I know it’s easier said than done but try to focus on what you do have rather than what you don’t.

Heartofmetal · 20/11/2024 08:37

Pigeonqueen · 20/11/2024 08:12

You could always rent out the 3 bed you’re in now and then use the rent you get to rent somewhere smaller for yourself when you’re older.

You’re overthinking this a lot. You have a lot of options long term.

Please don’t do this.
You’d pay tax on all the rental income regardless of how much your mortgage is.

Redburnett · 20/11/2024 08:39

Ask your parents for money if they are well off, no point waiting until they die and you get your inheritance. If you have siblings they can write something into the will to reduce your share accordingly.

ShesRunningOutTheDoor · 20/11/2024 08:39

My husbands parents never paid off their mortgage. They did equity release. Got a lump sum out of the house for retirement and the home is theirs until they die

butterfly0404 · 20/11/2024 08:40

Bjorkdidit · 20/11/2024 08:11

OP, in the nicest possible way, you're being ridiculous and you need to stop believing whatever rubbish you're reading that makes you feel like this.

You 'only' have a 3 bed house that you're buying with a mortgage that you've qualified for so the lender has deemed to be affordable? You have nearly 30 years before retirement age, so it should be paid off by then?

Presumably you have a workplace pension?

You're worried about inheritance tax 'wiping out' what you'll inherit? Perhaps read up on it? There's a £325k allowance and the tax is 40% over that, meaning that if the £900k house is your parents only asset, you'll inherit about £335k as your half of the value of the house after IHT, so enough to pay off your mortgage and leave a six figure sum on top of that. That's an enormous amount of money.

Just to say, if IHT thresholds remain the same, the allowance could be up to 1million, if OPs parents are married and their allowances pass to each other on death and they leave their estate to direct desendents, ie their children. It will likely be way more than 325k but obviously much can happen in the meantime, care home fees could end up taking a chunk.

OP I think you need some help with your overwhelming anxiety xx

MagnoliaGirlie · 20/11/2024 08:41

Justcaant · 20/11/2024 07:49

It doesn’t feel stable at all though. Most people I know don’t work at 70 and I will be working way beyond that if I pay this off and who knows if I will even be able to do that by then. What happens then? The home would be taken off me, I would have nowhere to live. I certainty won’t have money to help dd when she starts out. All I see ahead is constant struggle.

You would usually downsize after your DC leave the house. You'd make a profit on the sale of your current house, ideally enough to cover your smaller, next home so mortgage would be paid off straight away. The money you're putting on your house monthly builds your equity, so it is a form of saving, and you could remortgage if you really need to.
You'll also have a pension and other savings you'd made during those years, so you may not need to work past 70. Also, your parents are well off, any inheritance you could rely on?

November2024 · 20/11/2024 08:42

I have always viewed my mortgages as cheaper than paying rent and providing more security. Also as forced saving because I was terrible at saving (final salary public service pensions saved DH and I).

You can downsize and move when you are older.

Sort your sleep out asap. This will be magnifying all your worries.

ByQuaintAzureWasp · 20/11/2024 08:42

Have you thought about getting a lodger for 12 months to get you ahead with savings? You can earn £144 a week (£7500 per annum) tax free.
Alternatively you could do this in the future when your daughter has left home.

Alicecatto · 20/11/2024 08:42

What are you doing when your ex has your DD EOW? Are you doing anything nice for yourself…taking a walk, having a coffee/tea, meeting with friends, listening to music on the radio, meditating? How much are you exercising? When I feel anxious, a long walk helps a lot. Be kind to yourself.

You are worrying about things way distant in the future, and are coming to terms with the loss of a primary relationship. As other posters have said, that’s anxiety. Are you perimenopausal…that can cause anxiety too…it did for me. I might recommend a visit to the GP.

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