Twitter @AshleyFulwood ashley@ocduk.org

Adulting…. Mortgage saving when in debt

So in the last 18 months, I have started ‘adulting’…. and saving for my first mortgage… this is my honest saving story of someone aged *cough* 47 without savings, already in significant debt.

I will reflect honestly about the level of my debt and mistakes I have made. It’s grim reading for me, but by writing it down I hope it helps give others ideas for changing the direction they might be heading and also to offer some hope for anybody else about to start saving whilst in debt, because it can seem impossible, it’s not, you just have to get smarter and make some sacrifices… in my case no new bike until I have my own house to put it in!

Disclaimer: I have offered a couple of tips.  It is merely advice based off my own mistakes and from what I have subsequently read and learned… as you will read, I am not an expert!  So please check with your own financial expert before following my tips.

But first the back story…

Where I lived in Sussex between 2010 and 2017

So I was renting a lovely little cottage in Sussex, the old gatehouse on a small country estate and I was there for 7 years, actually the longest I had ever lived anywhere, OCD usually forced me to move one way or another.  But, after 7 lovely years the owners asked me to leave so they could, understandably allow their young adult daughter in there.

I moved to Belper and again, renting a lovely little place with lovely views and I had started to settle here in Belper after the shock of moving from my happy place in Sussex. But after a couple of years the owner decided to sell up to a property development company and left me with more uncertainty. As it happens, I am still here 2 years later, but that second shock of not knowing where I would live within 2 years was enough to encourage me to start adulting and saving money to buy my own place, so I am not longer at the whim of landlords and saving is not something I have ever, ever done in my life!

But slight problem, how do you save money when you are thousands of pounds in debt?

The back, back story.

Growing up through my formative adult years with OCD, I never worried about saving, I rented, I would throw things away that were ‘contaminated’ and buy again (on credit card).  I would move rentals often, 6 months usually, that would cost more money.  I grew up in an era where put things on credit, pay later and that’s how I lived from when I was 18, well until I started saving last year!

I lived the rubbish existence of work > OCD > work > OCD and as my work in the city of London meant my wage increased I would get more and more credit so I never worried.  In later years I was able to get smarter and simply put my credit cards on 0% deals until that expired and get another and another and another. I had several cards with lots of credit debt but I wasn’t paying interest.  I also had a loan to buy a car, then I would top that up when nearly paid off and just kept doing that.

I don’t know if this was because of OCD, but because my life never panned out, I never thought of tomorrow, only today I would worry about saving and buying when I settled down with someone….. but that never happened and life being what it was for me, I focused on developing the charity, but not myself…. perhaps it was easier to do that in my head.

I lived my life one day at a time because of OCD, with no thought of the future for too long, far too long.

So fast forward to 2019

I started to look at buying a house and how much I will need to save…. Geez, that was a shock. Do you know how much houses cost to buy these days?!   I didn’t!  Seeing the type of place I grew up in (fully detached house with front/back garden and a garage) now costs £200,000, some nearly a quarter of a million pounds, and that was quite a shock.

But I took stock and made some tough decisions…. time to start saving I told myself, paying off debt and spending more wisely and… stop buying new expensive bikes every 2/3 years!

I realised two things. I need to get my mortgage before I hit 50 and get it paid off by retirement age and that I need a 95% mortgage most likely.   But also, if getting my mortgage by age 50 is the target, I actually don’t have long to save!

Then came the realisation I am, paying loads of credit card/loan debt, so how do I also save for a mortgage?  Shit?!

I am targeting a 95% mortgage and I was very lucky, I managed to just get my Help to Buy ISA account opened early November 2019 just before they closed it to new applications in late November 2019. The Help to Buy ISA means anything I save for my first house, the government will add an extra 25% (if I claim before Nov 2030).

My age does count against me, so when I get the mortgage I don’t have long to repay it back before I reach retirement age, and that means larger repayments than I pay now for rent, but the more debt I pay off now, the easier that becomes once I have my house.

All of this sounded daunting and impossible, but by having honest assessments like this, I could take stock and start to create a plan. At first it was just to start putting a little into the ISA each month and go from there. I had bit of a stop/start with saving, but eventually I got my head down and focussed.

I created a plan for how much I can afford to save for my mortgage and how much to pay off existing debt. The most you can pay into a Help to Buy ISA is £200 PCM, and whilst that was a struggle some months I can afford that, just. Some months I will have spare cash to pay towards credit cards.  I would go through all the rubbish in my spare room and get it on eBay and 50% to pay off credit cards, 50% towards extra mortgage savings.

I mapped out that based off that £200pcm maximum ISA saving, how much I will have at the end of each year, with the 25% bonus. If I can keep the monthly payments up, it soon adds up…. even with the 2.69% annual interest when I opened the ISA now only 1%.

Total Saved with 25% ISA
End of 2020 Projection £2,639
End of 2021 Projection £5,077 £6,346.25
                                        Mid 2022 Projection £6,339 £7,923.75
End of 2022 Projection £7,539 £9,423.75
End of 2023 Projection £10,026 £12,532.50
End of 2024 Projection £12,538 £15,672.50
End of 2025 Projection £15,075 £18,843.75

The credit card debt was a concern, but the first thing I decided was because age is against me, I need to prioritise paying into my ISA.  Tip: For anybody reading this who is much younger, my advice would be to pay your credit cards first. Perhaps setup a standing order for £50 in a high interest savings account for your mortgage and everything else you can afford each month towards paying off existing credit card debt, that in time will give you so much more capacity to save quickly for your mortgage.

But because age is against me I am putting £200 a month into my ISA and everything else into paying off the 8 credit cards. I also planned to keep getting 0% interest card deals so I was actually chipping away at the debt without interest charges taking the repayment money.

Well that was the plan…

The plan unravelled….

Firstly I managed to get another 0% credit card deal so I moved the bulk of my largest card to that and paid off the remaining 35% of it. I had a huge £12k limit on the card which I had for 20+ years, and I did what I thought was the best thing I could, I closed the account.  I thought that would help my credit score and was the sensible thing to do was to get rid of £12k worth of potential debt.

Oops, I was wrong there.

My credit score with Experian went from Excellent to bordering on Fair/Poor.  From what I subsequently understand was that closing the Barclaycard really hurt me for two reasons.

 

  • 20+ years of credit card history lost. My next oldest credit card was only a few short years old.
  • £12,000 of available credit lost, which meant my credit score now showed I was using over 95% of credit utilisation.

Secondly, the other factor that impacted on my plan….  COVID!

With the arrival of COVID, 95% mortgages were gone (although at time of writing, some are now back).

The other problem was that a combination of COVID and my credit score now being reduced meant I could not get any more 0% credit card deals and as my existing 0% deals ended, one-by-one I am suddenly paying lots of interest of each month, so only a small amount is being repaid against each card.

Lost hope

I won’t lie, midway through last year getting a mortgage felt like a forlorn hope and I nearly jacked in saving and putting all my money into paying off credit cards. As mentioned before, if age was on my side, that would be the right thing to do. But with the advice of my house owning colleague who has been so encouraging and helpful, she told me to keep going, keep saving and because I cant afford to buy for 18-24 months anyway, mortgage deals will be back by then… she was right.

So, Plan B

Keep saving, stick to my chart above for saving projections and let the mortgage market take care of itself for now and review again this time next year. As it stands, I might have enough for my deposit by this time or towards the end of next year….  Not too long at all!

As for the credit cards, create a plan and stick to it.  The plan I have created is, create a list of the cards with the lowest amount owing and chip away at them one-by-one. What this will do is mean I will see cards being paid off and from a morale boosting point of view that will really help.  And each time one is paid off, I have more available money to pay the next one off.  (Tip: For others, you may be better paying off the card with the highest interest rate first).

I still have my loan, that was due to be paid off next year, but I was offered a three month loan holiday which I accepted (I pay tad more interest, but I am paying more credit card interest). I made use of that money to pay off a huge chunk against one of the credit cards.

As it stands, two cards have been paid off now, and another as a balance of just £19 left on it which will be paid off next month.

Plan B then become problematic…

The bank accidently forgot to mark my loan repayment holiday as a holiday and it was reported to the credit agencies as the missed payments. My credit score that had risen to almost Good dropped to Poor, bordering on Very Poor.

Then yesterday I had a text to say I was over 90% of my credit limit on one of the credit cards. When I checked today I realised that MBNA had automatically lowered my credit limit… that in itself is fine as I don’t need credit, but what it does mean instead of that card utilisation being around 50% it means I am 95% at my limit. I called them today and they told me because my credit report changed (because of the bank’s mistake) they automatically lowered my credit limit and did so immediately without warning and can’t raise it again for 3 months.

This is important because Experian seem to mark down if you go over 80% of your available credit.  79% seems fine and marked in green, over 80% seems to go red and lowers your credit score as you can see in the image.

My bank have raised a complaint on my behalf automatically and will report to Experian correctly that I had not missed payments. But that doesn’t help me as I now have to find £500 to get my MBNA credit card back to below 80% of the new limit.

Another credit score issue happened last month. Because my previous energy supplier, Bulb, had increased their costs for the second time in a year I switched to OVO energy in April to try and save money. What I didn’t realise that opening this account is classed as credit and as also meant my credit score dipped about 14 points for opening a new account.

 

Problems, but keep going…
If OCD as taught me one thing, problems and setbacks are simply challenges waiting to be faced again, that I should not give up and I need to keep fighting, keep moving forward, even if it the pace is slow. Slow steps that are moving forward still lead to long journeys.  I have done that for 25 years now, I know how to face setbacks and fight back, I can do this,  I have this!  I have my house buying target in sight, and that is potentially only a year away. So I will keep going, no matter what new problem crops up.

Credit Score importance
The reason I keep referring to the credit score is that it plays a part when it comes to getting a mortgage. From what I have read and understand, whilst a bad credit score won’t stop me getting a mortgage, it may stop me getting the best deals.

That’s why I am paying £14.99 a month for Experian to keep a close eye on what is bringing my score down and trying to do what I can to boost it (like reporting my rent).  Just seems ironic we have to pay £179.88 a year to see what is being reported about my own financial situation… a £179.88 that could be used to improve my financial situation!  To be fair you can get a free monthly score, but without the premium subscription I would not have known the banks error had caused a big impact on my credit score.

When I do have enough for my mortgage next year, I will review my credit score and I may still wait 6-12 more months to keep paying my credit cards off to boost my credit score before I apply for a mortgage. I will take advice at that stage if there is benefit in me waiting a tad longer, plus if I can somehow save enough that I only need a 90% mortgage instead of 95% might help get a better mortgage deal too.

I did read a great article on the Money Saving Expert website and a couple of others that makes the following recommendations:

  1. Check all credit scores with three main providers and check the report carefully to fix any errors being reported. Do this 3-6 months before applying.
      • Experian
      • TransUnion – I get this score reported free through my Natwest Bank Account.
      • Equifax – You can get this free by signing up to ClearScore
  1. Don’t apply for credit for three-six months before applying for mortgage.
  2. Try to keep below 50% of available credit. I.e. you’ve a combined limit of £30,000, they’d rather you use less than £15,000 of it.
  3. Stay out of overdraft for at least three months before application.
  4. Credit agencies can take some time to reflect improved score. I found this myself, when I paid off a credit card in full, they took 3 months for that to reflect in the credit agencies reports.
  5. Cancel old unused store cards.
  6. Pay for house/car insurance up front not monthly.
  7. Check addresses on old accounts. Old credit cards or utilities if showing old address, may impact.
  8. To test a mortgage agreement in principle (AIP), offered by many lenders, is the acid test. It’s a conditional offer saying you maybe accepted.
  9. DO NOT REAPPLY IF REJECTED UNTIL REASON RESOLVED

 

I am also aware that when I do get my mortgage I then also face lots of added fees to actually buy the house.

House Buying Fees
I also need to start saving for my house buying fees, which so far will include:

    • Stamp duty – (1% on houses up to £250k. 0% for First Time Buyers.)
    • Solicitor fees
    • Removal fees
    • Survey/valuation fees
    • Search fees
    • Land registry fee

Someone who recently moved house gave me a costing on their expenses, and I think is likely to be between £1-1.5k for me, at a guess based off their fees. Hopefully I can get it much less, but at least that gives me a guide on what to budget for.  Plus my rental deposit should be returned back to me to help offset these costs.

EXPERT ADVICE WELCOMED
I am no expert in any of this, credit scores or mortgages, I am learning by reading (and with the advice of my colleague), so if you think I am doing something wrong with my plan please do let me know. I welcome anything that helps me get the keys to my new (forever) home!

Finally…

I am so proud of the fact I have actually saved so much money, for the first time in my life, proud of the fact I am sticking to the plan and creating the plan B where needed and proud of the fact I didn’t give up when things looked impossible. The image below is a snapshot of how much I have saved on my own for the first time in my life, it might not look much, but it means so much to me, it’s a start and a good start in less than two years of saving.

Suicide by middle-aged men – Paper by National Confidential Inquiry into Suicide and Safety in Mental Health (NCISH)

In my previous blog above I reference a paper Suicide by middle-aged men published by the National Confidential Inquiry into Suicide and Safety in Mental Health (NCISH).

As much as it pains me to admit I am middle aged, it does make for interesting or rather I should say it makes for startling, reading. I did not know that since 2013, men aged 40-54 have had the highest suicide rate in the UK; accounting for a quarter of all suicide deaths in 2019, that’s was a startling revelation and something of a wake up call as I mentioned in my previous blog.

For anybody that would like to read the report, this is the link:
https://sites.manchester.ac.uk/ncish/reports/suicide-by-middle-aged-men/

The researchers identified 1,516 men aged 40-54 who died by suicide in the 12 month study period (2017); of these, they selected a random sample of approximately 20% (n=288) for whom further information on the factors relating to suicide was sought – these men are the main focus of the study.

Some of the key summary findings included:

  • Since 2013, men aged 40-54 have had the highest suicide rate in the UK; accounting for a quarter of all suicide deaths in 2019
  • The suicide rate in middle-aged men in the UK is 3 times higher than women of the same age and 1.5 times greater than men in other age groups.
  • Almost all (91%) middle-aged men had been in contact with at least one frontline service or agency, most often primary care services (82%). Half had been in contact with mental health services, 30% with the justice system.
  • High rates of key risk factors were found, compared to their incidence in the general population. 30% of men were unemployed, and a fifth (21%) were divorced or separated. Over a third (36%) reported a problem with alcohol misuse; 31% reported illicit drug use.
  • Overall, 57% were experiencing economic problems – unemployment, finances or accommodation – at the time of death
  • 45% were reported as living alone; 11% had reported recent social isolation
  • More than half (52%) of men who died had a physical health condition, most commonly circulatory system diseases, such as hypertension.
  • A comparatively low rate (5%) of engagement with talking therapies was evident among the men we studied, despite the higher than expected rate of contact with services that we found. This is consistent with data showing women are twice as likely as men to finish a course of Improving Access to Psychological Therapies (IAPT), and are more likely than men to seek help through psychological therapy.
  • 44% of men in mid-life who died by suicide had previously self-harmed, 7% in the week prior to death.
  • 34% of men in our study appear to have been affected by bereavement, 6% by suicide bereavement.
  • 15% of men who died by suicide had used the internet in ways that were suicide-related, most often searching for information about suicide methods.

We often hear that men don’t seek help, but as the data above shows that is simply not the case in many cases, and as the report suggests it’s too simplistic to say men do not seek help. If I am reading correctly they do, although not always because of how they are truly feeling.

For me this report is something of an eye opener, and I hope as it becomes more widely circulated so that all services can collaborate and implement more recognition for potential red flags and sign-posting that will potentially offer life saving interventions.

Recognising your struggles can be life-saving

Earlier this week I read a report finding summary that men aged 40-54 have the highest suicide rates in the UK, and whilst I knew the statistic about men, I had not realised the age bracket and suddenly I had a realisation, one I am not sure I welcomed.

This is not just another mental health awareness week post, this is something of a personal reflection… for me, more than anybody reading.

In recent weeks I have had more and more thoughts about wishing I could end it all, and wanting to close myself off from the world or run away.  Before any of my friends start worrying, this is not a cry for help or an indication I am about to attempt to take my own life.  But I am struggling, and beyond writing this blog I am not sure I even want to talk about it yet.

In my case, there is no one trigger for me feeling like this, it’s a myriad of things all coming together at one time I guess.  I have not really had a break in over two years (Easter 2019 my last time off work), the charity growth in the last year as meant I am working all hours just to stay afloat and that’s not good for anyone.  It’s made me lethargic most of the time,  I am tired, I am snappy and the more I feel or act that way the worse it makes me feel, so it becomes something of a vicious cycle.

Other contributing factors include recent acknowledgment that my life’s not what I wanted, and my age is making it harder to achieve that, that’s playing on my mind too.

When I add the fact my OCD as got worse in recent weeks (well last 12 months) I am beating myself up every time I fall, needing to be this beacon of hope and recovery for everyone.  Now don’t get me wrong, the gains I made previously are still gains, they’ve not slipped.  But the one area of OCD that I failed to address as got significantly worse in recent months to the point when I am triggered I am stuck doing rituals for 2-3 hours, using 2-3 bottles of bleach and Dettol surface cleaner. Thankfully those blips are rare once a month, sometimes every couple of months, but in the last week the triggers happened twice.

All of that as led me to feeling tired, just so, so tired of life.

This week I have woken up after a good nights sleep, but despite that I have still felt on the edge for no real reason, I have felt on the urge of crying both days (and geez, for my generation this is not an easy thing to admit). I didn’t, but I felt that way all day both days this week.

So, the research statistic was bit of a wake-up call for me, and I spent last night with the realisation that I am so lucky to have realised what’s happening and managed (or I will) get myself off the path that may have led to darker days. I need to take care of my mental health. Acknowledging the problem being the first step I guess.  All of these factors combined could well be what’s making me feel this way, and it’s not something I have experienced before.

I can not deny I have and are having an increasing number of wishing I could end it all thoughts, but that’s all they are thoughts, no desire or intent to act on those thoughts. But the research as made me realise that I need to look after myself better, and address some of the problems.

I do have my first holiday for some time booked for July. A few days in Cornwall (I couldn’t afford a full week at this years prices, or find anywhere affordable with a full weeks availability). I was thinking of cancelling because a) it’s not my beloved Majorca and b) I am saving for a mortgage. But I realise I need to go, and I will go.

I guess what I want to summarise is that sometimes no one trigger could lead someone down a dark path, it could be a combination of life factors and a sense of hopelessness for a brighter future.  Sometimes, even the strongest of people can be suffering inside and as we have seen with the sad passing of well known sportsmen or celebs, we don’t know how someone is truly feeling beyond their public persona.

I will survive, I always do. A random act of kindness from a friend last night reminded me that if I need to reach out for a guiding helping hand, that I have good friends ready to give me both of their hands if I need them.

Wishing us all, good mental health.

Ashley 🙂

Note: * The report is due to be published tomorrow by the National Confidential Inquiry into Suicide and Safety in Mental Health (NCISH). I will post edit this part to add the paper link once published.

Post Edit: A final thought on Mental Health Awareness Weeks. During the last couple of years I have seen increased social media criticism of such weeks. Some of that criticism is valid, but much of it fails to acknowledge the point that anything that gets people talking about their mental health problems on a large scale like MHAW, either online or to a friend or on blogs like this that nobody will read, well that can be enough of a cathartic experience that helps keep some people, like me, afloat.

Ashley - Promotional Pic 2005

In the blink of an eye I am 47, what happened?!

The other day I stumbled on this photo which I had not seen for a while and I started to reminisce about all the good our charity team have achieved in the 15 years since that photograph was taken. But it was also tinged with regret, of sorts, I later told a friend.

“15 years ago, I was a 32-year-old young professional, I still had my life ahead of me and I was more than happy to prioritise my work for the charity. But in the blink of an eye I am 47, still single and childless… what happened?!”

My friend asked me if I felt sad about that? To which I had no reply.

But the fact I still tell everyone I am 39 perhaps goes someway to answer that. At 39 I felt I still have a little time on my side to get those things, at 47 the chances of being a father at my age are now pretty unlikely.

My friend reminded me that my job is an important one, and more than a job, which is right and I wouldn’t change that for anything in the world, but as I told her…

“Along the way I’ve forgot to enjoy life or I’ve used work to avoid living life.”

At which point, like any good friend, she didn’t let me off the hook she asked me which was it? The honest answer is I am not entirely sure, although my colleague firmly believes it’s the latter. I think that’s right, but we need to go back to the beginning to understand why.

When I was younger OCD was the dominant feature of my late teens and all of my 20s, even some of my 30s. The truth is OCD prevented me enjoying life like I wanted because of the never-ending washing to ‘feel’ clean, I avoided life. Each day was strictly the ‘three W’s’, Wake > Work > Wash!

Because of this I rarely went out to socialise. As the years went on socialising, making small talk, being in social situations became more and more uncomfortable and so I avoided situations even more. I would throw myself into work to avoid having to be in those social situations, and of course my opportunity to meet anyone or date became limited.

When training therapists, Professor Salkovskis uses the term ‘collateral damage’ to remind them not to ignore the impact OCD can have on a person’s life. Because when OCD is successfully treated, it can leave a huge gaping hole for some.

I guess the collateral damage of my OCD was I remained isolated and lonely. Although, I tried to kid myself for decades that I wasn’t lonely, the truth was I have always been lonely. Perhaps this is why I enjoy cycling, it’s something I can do on my own without having to cycle with anybody else.

Back to the earlier question, I guess the truth is I used work to plug the big gaping hole caused by OCD. The socialising, dating and relationships that most people learn to do in their teens and 20s was an alien concept for me, despite some failed dabbling over the years. At my age people expect you to know how to do all of that with relative ease, but for me it still feels uncomfortable and embarrasing, even now at the age of 47.

So, in the blink of an eye I’m 47… what happened?!

OCD happened, but worse still I have let it happen (the collateral damage part).

I know admitting this this leaves me open and vulnerable to ridicule, but at my age 47 I have stopped caring if people judge me for my failings. (Did you hear that Zoë, I said I was 47!).

I hope by writing this, it may help others, perhaps whose life didn’t pan out how they had hoped to feel a little less isolated. I also hope this might remind others that once OCD is no longer stopping you living life, to make sure you actually do live your life! Go and have fun, make mistakes, but jolly well make sure you live your life.

Life may be different to our we envisioned it, but we owe it to ourselves after years of misery from OCD to make sure whatever life holds in the future, we make sure the future starts now.

One of us has to go by Katja Schulz

My colleague at OCD-UK has written a full review of this book over at on the OCD-UK website but I wanted to add my thoughts.

These days there are numerous books sharing first-hand accounts about OCD and several novels featuring characters with OCD, all of which are well written.  But rarely have I come across a book that takes you deep into the depths of the life impacting devastation that the illness can cause, a book that truly takes you on a journey of suffering for both of the main character’s, Sonja suffering directly with OCD, and Finja suffering in-directly with OCD.

Despite the subject matter, this is not without warm moments, and somewhat surprisingly considering the dark subject, Finja and Sonja’s journey becomes a page turner. 

Just when you think you know where the book is taking you during those final few pages, there is a shocking twist that will rock you to the core when you remember the novel is based on the authors own experiences.

Understanding OCD

Part of my job involves helping people understand OCD better, and a matter of frustration for me is that all too frequently I find myself having to do this with people who have experience of OCD.

These days the online OCD community seems to focus far too much on the manifestation of Obsessive-Compulsive Disorder, and sometimes fails to recongise the impact that OCD causes on the individual, regardless of manifestation.  As a result of this, over recent years the more people unhelpfully promote sub-types of OCD it’s not uncommon to hear some say “I wish I ‘just’ had basic contamination OCD”. It’s got to the point where people have, probably unwittingly, minimalised and trivialised the impact that obsessive fears around contamination can have on an individual. This book will change that perception forever, as the human cost of OCD is laid bare for the reader to see.

Would I recommend Katja’s book?

Absolutely,  for those with OCD and for any health professional too who want to get an understanding of just how far untreated Obsessive-Compulsive Disorder can take someone.