How are we doing?

[howarewedoing]

Hi, I think I'm relatively young for a mumsnetter - don't often post but read a couple of things about people being close to paying off mortgages etc and I wanted to get some reassurance really that we are doing ok.
I got married last year and my husband and I have been together for a while. We are both late 20s - I'm 27.
We have a 320k mortgage on our house that is worth around 420k, but we have 37 years left on the term. We got a longer term to make the monthly payments more affordable.
Is that really bad? We wouldn't be able to afford the payments if we reduced the term but hopefully maybe one day in the future we will?
We don't have any savings at all - I think that is the thing that concerns me the most but we earn decent salaries I think so that gives me a bit of hope that we are ok???
Don't know what I'm looking for really just wondering what position others were in at this age or what position people they know of at this age are in?

Honestly, it’s fine. You should try and get some savings sorted and think about how you would afford the mortgage if you were on mat leave etc- if that’s something you want to do.

Taking the mortgage over a longer period is very normal nowadays- house prices have gone up so much, and now so have interest rates, that people have to do this to afford the payments.

Thank you.

I'm actually pregnant right now so that's why I'm worrying I think.

We just think we have always had something to save for eg the house deposit and then our wedding and wanting to go on a couple of long haul holidays before starting a family

We have worked out that we can save enough between now and baby coming to be able to have enough for my joint account payments plus 'fun' money during maternity leave and a little bit to save. My husband will be able to save as well.

Thanks very much for your message

You want to keep your mortgage lower at this stage of your life, you can either start overpaying when the kids are grown which you'll have plenty of time to do if having kids in your 20s, or you downsize later on but you've benefitted from the family sized home whilst you've got a family. That's the way I see it, we are in a similar situation.

Depending on where you live in the country I’d say you’re pretty average. I don’t have as much of a mortgage as you but I quite possibly live in a cheaper area. I’m also a decade older. I’d have a look at childcare costs now though if you’re pregnant and come up with a plan for that, if you have no family help then it’s expensive.

It's fine as you've clearly taken out the mortgage when very young. I think longer term mortgages will be the only way for young people to get on the property ladder soon.

Just remember that people who are older and finishing their mortgages now perhaps started in very different economic circumstances to when you’ve started your mortgage. So don’t compare too much, just try to do the best you can with what you’ve got.

tbh I would prioritise saving for an emergency pot (6 months worth of household salary) and then baby/nursery fees over holidays, but all depends on what you want out of life and how soon you want a baby.

I think having a longer term mortgage is probably the norm when you're facing nursery fees that may be more than your mortgage payments. The first 5-6 years are financially the worst....

Sorry, missed that you’re pregnant right now - defo prioritise saving for nursery fees if you need a nursery space

Thanks everyone really helpful responses

Luckily we will have family help so hoping to only need one day of nursery, maybe two

What I like about your posts is that the maternity leave planning and saving sounds joint - you talk in terms of ‘we’ and that’s really important. You need to be a team on finances and what the future looks like.

You’re young. As you get older and past the expensive childcare years, and build more equity (although at £100K you’re already doing well) then you can overpay to clear it quicker. But for now, concentrate on more immediate things. Just keep an eye on it and every time you remortgage see if you can shave some time off the term. For me personally, I’d like to have it paid by 60 latest, so that’s 4 years as a first target to aim for, if you agree.

(Btw, on childcare, lots of settings will say 1 day a week is disruptive to children for settling in and will insist on 2 sessions/days so I’d budget for a minimum of 2 days a week).