Plans are Things that Change

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Thus goes the quote by Fujio Cho, the honorary chairman of Toyota.

I’ve had a lot on my mind lately, not just the bubble of stress I’m beginning to feel, with my boss leaving next month but about something else.

It’s resulted in me sticking my head in the sand, procrastinating. Wanting to hide.

Me, lately.

It all started with various conversations with my Mum, the gist of which you will get in the below summary of said conversations:

Mum: “I’ve thought about it and I definitely want to sell the house asap.”

Me: “What house?”

Mum: “The house you’re living in. I told you about it earlier in the year.”

Me: “No, you didn’t tell me.”

Mum: “Oh, it wasn’t you then, it must have been your sister. Did she not tell you?”

Me: “No. She’s been really busy sorting out her own house.”

Mum: “Well I want it sold. You need to move out and get your own place.”

Me: “It’s not a great time now. I can’t sell my flat as the cladding issue hasn’t been sorted. How about next year?”

Mum: “I don’t want to wait that long, just get it done. Since you can’t sell your flat, do you need a loan then?”

As a reminder, I currently live on my own in our old family home. I pay nominal rent to my folks but have been responsible for the upkeep and repairs of the house. Over the years, the house has been a UK holiday home for close members of the family to stay in when they are over on holiday.

I always knew I would need to move out sooner or later – later rather than sooner though, according to my plan.

My FIRE plan has always accounted for the fact that I would either be renting or with a mortgage once I’d FIRE’d. Originally, I planned to continue to receive rental income from my BTL property upon retirement, but I came to realise that I would find it too much hassle, so I decided that, at some point, I would sell it and use the equity to buy somewhere to live.

Cladding Schmadding

As I wrote here, my flat is caught up in the cladding safety issue. It doesn’t actually have any dangerous cladding but building inspections have revealed that it doesn’t meet the new fire safety regulations. Until this is rectified, I (and the other leaseholders) must pay for a Waking Watch (fire wardens), which has nearly tripled the service charges we have to pay, and we will also have to pay for the building to be made safe, whereby a safety certificate shall be awarded.  I cannot sell my flat without such certificate.

Since I can’t sell it, I will have to borrow more against the BTL but am uneasy about this because I still don’t know what the final property bill will be yet. The rental income I’ve been getting over the years has been put aside for ‘property purposes’ but this is now earmarked to go towards the final as-yet-unknown cladding bill. I dread to think what that might be.

Because of these factors, it’s looking inevitable that I’m going to have to use part of my Future Fund to fund my house purchase.

The thought of it makes me feel sick and depressed.

Feeling Low

This has really been getting me down. My Future Fund is not meant to be used now.

Yes, I acknowledge this is a first world problem, not a ‘real one’. I have the funds to use, so what’s the problem? The problem is that it’s messed up my plans, and I feel like I’m starting to spiral out of control.

I need to get my head around everything, adjust my plans (and my thinking) so that I feel like I know what I’m doing again.

Why Now?

I’ve always known that at some point in the future, my folks would want to sell the house, but why now? With my Dad’s heart issues one year which resulted in a cancelled trip and with no travel being allowed in 2020, it’s now been over 4 years since they were last in the UK. They used to have regular holidays, lasting several months, enjoying the British summer (such that it is), and avoid the worst of the scorching and humid summer months in the far east.

Clearly, absence has not made the heart grow fonder, and for some reason, their friends were always telling them to sell up and transfer the funds to Hong Kong (though what business it is of theirs, I don’t know…).

I think the pandemic has accelerated the timeline of the house sale. I reckon had my folks been able to make their trip over to the UK last year, I don’t think they’d be wanting to sell so soon.

However, it’s probably now unlikely that my Dad would rush to make the trip over at his age now – the effects of lockdown have made him years older – perhaps one more trip, perhaps no more, I don’t know, so I guess it makes sense for them to get rid of their last asset in this country.

Would I not want to buy the family home? Much as I love the house, it’s too big and way out of my budget and if my folks were to sell it to me cheaply, it would cause sibling friction and that’s best to be avoided at all costs.

Bank of Mum and Dad

I tried explaining several times about the cladding issue with my flat and each time, my Mum’s answer was that the issue would be resolved with her giving me a loan.

The first (and last) time I borrowed from my parents, I was 20 years old and the loan was used to buy my first car.  This loan was paid back (as are all loans to family members).

I had used my own money to purchase my first property (the one I had with my ex), so it doesn’t quite sit well with me that in my 50s, I’m left with no alternative but to borrow from my folks to buy a house. I’m sure this might be normal for some people but it just doesn’t feel that way to me.

Perhaps it’s a bit of foolish pride – I would have much preferred to have done this all on my own.

Plan of Action

As already mentioned, I need to take action to bring some semblance of control back.

I don’t have a lot of cash in my Future Fund, just some in premium bonds.  A week ago, (randomly timed before the markets started to wobble all over the place), I cashed in on some profits in some of my ISA investments, in preparation for when I might have to use the cash. As a mainly buy and hold investor, it was hard to sell but needs must.

From this month, the chunk of money I normally invest in my ISA will instead be lumped into premium bonds to add to my cash pile. I can’t bring myself to stop investing entirely so I will leave the small standing orders that pay into my ISA (and my SIPP). I’ll also continue to invest any extra bits of cash from my side hustles and also carry on investing any dividends received.

So, when it comes to dipping into my Future Fund, the premium bonds will be used first, then uninvested cash sitting in the ISA, then finally as a last resort, sell more equities if required. Or should I sell the bonds? Not figured that out or looked into that yet.

Remortgage

I’ve contacted my BTL mortgage provider and have received confirmation of the amount extra I can borrow, which I’m (mostly) comfortable with. However, as this isn’t the full amount of equity I could have realised from my flat sale, it’s unlikely to be a big enough deposit I would want to put down on a house.  So it looks like a family loan will be required.

However, once I am able to sell my flat, I will be able to pay the loan back in full.

House Hunting

I’ve registered with various estate agents and looked online myself – houses are being snapped up really quickly and I’m finding that some appear on websites already Sold STC or Under Offer.

Due to social distancing, for houses I’ve wanted to view, I’ve been placed on a waiting list as I guess viewings have all been restricted.

I’m sure something will come up. I might not be able to stay in the area as house prices are mostly out of my budget but who knows, I may be lucky and the right property will come up and I’ll be quick enough to pounce.

Control

Despite how it all seemed at first, I do have an element of control as I’m the one who will need to put the house on sale and I won’t be moving out until I’ve found a place to buy. The ‘chain’ also only impacts the property sale, not on the property purchase, since the funds to purchase the latter are not reliant on the sale of the former.

I reckon I will need to reconsider my costs (and my lifestyle) as I may have to tighten things up, while I adjust to change. My anticipated mortgage will likely be marginally more than what I pay my folks for rent right now so no material change there – it’s the initial costs of a new home which are going to be the killer, plus any other house costs which might have to be sorted once I’ve moved in.

And once I’ve settled in, a kind of normality shall resume so that I can continue on my FIRE journey in earnest.

Phew!

I feel a bit better for writing that.  The uncertainty of it all still scares me but things will become clearer in time. I hope it will soon feel like it was my idea to move in the first place and at that point, I think I will feel a lot more comfortable.

Some heart-felt thanks go to @indeedably who reached out, provided me with a friendly soundboard and ear, and made me see some of the positives, where I could only see the negatives.

Onwards and upwards.

91 thoughts on “Plans are Things that Change”

    • That was going to be my question. Let the current tenant’s lease expire, and move in there. If that’s not possible immediately, I’d rent, with a view to moving into the flat when possible. Once the cladding issue is resolved I’d sell the flat.

      Couple of points…

      If you already own a property (like the flat) and you buy an additional home you’ll get hammered for stamp duty surcharge (I guess unless you can complete before the stamp duty holiday – not sure, but does that stamp duty holiday apply to second homes?). Basically you really don’t want to get hit with stamp duty surcharge.

      I would really question the validity today of BTL in the UK. Given the stamp duty surcharges, the fact that you can no longer offset mortgage interest against tax, and the capital gains taxes on selling a second home, it really does not make financial sense any more – at least whenever I’ve crunched the numbers it did not look attractive to me…

      So, in summary, I would not buy a second home. I’d move into the flat as soon as possible, and if that’s not possible I’d rent until the flat can be sold.

      • Agree with all the above.
        First, you’re correct, the SDLT holiday does not apply to second homes, so if Weenie were to buy now, she’d have to sell the flat within 3 years to reclaim the SDLT, and with the cladding issue, is that really likely? Even if it is, it seems additional stress for no real gain.
        Agree it’s not worth being in BTL any more, certainly unless you have enough properties to make it realistic buying them as a Ltd Co. (we’re getting out too). So moving back into the flat as soon as the tenant’s contract is up would be the most sensible idea. It should be noted that even if the tenant isn’t on an AST, the Coronavirus Act 2020 states that all tenants must be given 6 months’ notice, so the sooner this is given the better.

        • Hi Tina

          The tenants’ lease won’t be up until next summer; as per above comment, I had just renewed it (for another 12 months) as I didn’t know of my parents’ plans.

          Sadly, I can’t escape from the SDT but neither can I reclaim it as my BTL was never my primary residence, ie I’ve never lived in it.

          • sounds like your sister owes you a huge apology for not telling you of your parents plans. you might have avoided extending the lease etc.

            No point crying over spilt milk, so I guess grin and bare it, move in with your sister!

      • Hi Codefreeze

        Because I was only made aware of my parents’ wishes to sell their house recently, I had already just renewed my tenants’ lease so they will be there a good while longer.

        And yes, as this will be my second property, there will be stamp duty to pay, even if I was able to turn this around during this ‘freebie’ period.

        I do want to get away from BTL, I just can’t sell right now.

        • Yes, but why buy another house? You’ll be hit for stamp duty surcharge, on top of stamp duty, and then capital gains tax when you do sell the flat. That’s a LOT of money. Surely better to rent somewhere cheap until the tenants move out of your flat, then move in there until you can sell the flat, thus avoiding both stamp duty surcharge and capital gains tax. You can then use the proceeds to buy your “forever home”. This route means you avoid stamp duty surcharge and capital gains tax, at the cost of renting for a year. Or am I missing something?

          • Yes, renting can’t be ruled out but purchasing a second property will be the preferred option – I guess I will be paying for the convenience of just moving out the one time, not having to put my things in storage.

            Capital gains tax looks inevitable as I’ve never lived in my flat and to register it as a main residence, I need to show the taxman that I moved in and lived there for 6-12 months – as per my response to @Neverland, I’m not sure I could do such a downsizing for such a long period.

      • hmmm…you can now give the tenants 4 months notice to go? what a pain – but it’ll work out!

  2. Bad luck on the timing but no doubt at all that you’ll figure this out. You clearly have the nous to deal with all sorts of situations that would send lesser mortals into a spin.

    Ref housing in Manc, not sure where you’re currently based but we live near Prestwich, which we like and is much cheaper than to the south.

    • Hi Northern Lad

      Thanks for the words of support and vote of confidence!

      And ha! I am in the Prestwich area, and yes, although the properties are cheaper here than in the south, many are still slightly beyond my budget, especially as I’m buying on my own.

      Still, since you’re in the area, if you and yours ever fancied meeting up for a pint to chat about FIRE..? 🙂

  3. Sounds like a stressful time. It sounds like you are doing the right things though. If you need any help re: mortgages, let me know.

  4. Sigh! Covid put lots of travel plans on holld – it’s a shame your parents couldn’t come over.

    Hang in there – you do know what to do and as you say, still have some control.

    • Thanks for the words of support, Latestarterfire.

      Yes, at first it seemed like I had no control whatsoever but I do have some; I need to work at getting more.

  5. Annoying hiccup but you’ll overcome it, I’m sure. With it being your house, you can rent out a room, even if just temporarily, with the cash helping top things back up.

    And I’m sure you’ll enjoy the satisfaction of living in *your* place.

    I hope it all works out, I’m sure it will.

    • Thanks EMS
      Yes, when it’s my place, I will have more options including renting out a room if I choose to do that, to get some extra cash in.

  6. I get it. When everything comes at you all at once it can seem super overwhelming, but a willing ear and some time to think always find their way at some point 🙂
    Hope it all goes well!

    • Thanks AMM.

      Yes, after the first conversation with my Mum, it did feel like everything was crashing down on me like a house of cards – the route is clearer, though still not quite clear enough!

  7. Great to see the beginnings of a plan forming.

    Given the frothy property market, it would be worth letting it slip to the estate agents that you’ve soon got a property to sell. That’ll get you to the front of the queue, hearing about upcoming properties before they hit the open market, while the agent dreams of the commission to be made from selling your current home.

    Good luck with it, I look forward to hearing about your amazing new “forever” home in due course.

    • Thanks for your support, indeedably and interesting, I hadn’t thought of dangling the ‘property to sell’ carrot as I saw both actions as separate.

  8. Sounds like a very frustrating situation. You’ve had a bit of a run of bad luck and combined with the lockdown I’m sure it would get to anyone. However, I’m sure it will all work out in the end.

    Although it’s annoying to dip into the future fund, you are merely transferring wealth from one asset to another. Your net worth will remain intact so to speak. Of course, it’s not the same as having an accumulation fund, but you will be able to rebuild it I’m sure.

    • Hi The Wealthster

      Yes, frustrating but have to be thankful that I got into a position where I do have the wealth to transfer. I will rebuild.

  9. Feel your pain. Our landlord is cashing in on the frothy market and due to being self employed and accepting government grants we can’t borrow as much from the bank as last year despite having a decent deposit to buy the house we have rented for many years.

    So we are having to look for family home rentals, – there are none. Or panic buy ourselves!

    • Hi Jimbo

      Sorry to hear about your situation – some of the comments to this post propose that I give notice to my tenants but I (maybe foolishly) want to do the right thing as a decent landlord – my tenants have lived in my property for over 4 years, so it’s their home and they have never missed or been late with payments. I have the option (though more expensive for me) not to ask them to move out so that’s what I would prefer to do. All the best to you with the family home rental or house purchase.

      • Could you not inform your tenants of the situation and let them know that you will honor the year-long lease but that if they find another place before the lease expires, you would happily let them out of it? Then maybe you could rent month-to-month until then … or is month-to-month renting not a thing where you are?

        • Current government guidelines mean that notice period is 6 months, or 4 months from 1st June…so there would still be a wait for them to leave anyway.

          • Hi CiCi
            As @Jimbo says, minimum notice must be given but I don’t really want to turf my tenants out of their home (unless no other alternative), plus I don’t really want to live in my BTL.

  10. Sounds like this was always going to happen but now it has been moved forwards and your control over it has been lessened. I can understand your anxiety and the effect it will have on your plans to fire, which at the moment are unknown.
    As Madflier has asked – why can’t you move into your flat? (and I am sorry to read about the issues with it and the unknown timeline/costs to get it sorted).

    The good news is that you are still working and earning good money so you have time and capacity to amend your plans. It all may seem depressing now but you will get through it and feel better on the other side. It had to be sorted one day!

    I went through a divorce 11 years after I ‘fired’ (imagine what that does to your long term plans!) , so I understand your feelings – you will get through it.

    Good luck and keep going….

    • Hi Tim

      Thanks for the words of support.

      Correct, this was always going to happen but the timeline has moved forwards and I wasn’t prepared for it – I guess I should have been, so I’m to blame for that.

      I could give notice to my tenants and move into my flat, but becoming a greedy money-grabbing landlord and turfing out decent tenants who have lived in my property for over 4 years does’t sit right with me, not when I have the option to do something else in the meantime, which although will work out more expensive, is something I can live with.

      Yes, the positives are that I’m still working and can (and will) adjust my plans.

      Sorry to hear about your divorce after you FIRE’d – hope all worked out ok for you in the end.

      • hi, You do well in replying to all your comments – thanks for taking the time to do so. I don’t know if its just me but I keep re-reading your initial post to understand fully your plan. As I understand it you will remortgage your BTL and borrow some from your M&D to put a deposit down on a new property with a new mortgage? You will repay M&D once the flat is sorted and sold. Don’t feel guilty about the loan from M&D , they have offered it to you and they changed the timeline. I hate uncertainty as I can’t plan my finances properly and you have a lot of short term unknowns but you have a plan which is good for you.

        I was prepared for stock market crashes of say 30% (and had them), I knew my dividend income would mostly hold up until the market recovered but I was not prepared for a 50% permanent fall in my total assets following my divorce. I worked out a plan , stuck to it and now I am out the other side. It worked out well for me and I am sure it will for you.

        Happy to talk more if you want, Tim

        • Hi Tim

          Thanks for the kind words of support and yes, you are correct (glad that I did make some sense in my post) – the plan is the remortgage the BTL and borrow from M&D for deposit, then get a house with a new mortgage. Then sell the BTL to repay M&D loan.

          Ouch, sorry to hear that you suffered the 50% fall in assets but well done to you for pulling yourself through that and for it to all work out for you in the end.

  11. Life comes at you fast. Sorry to hear about this turn of events.

    Others have suggested living in your flat as the simplest solution. This also has the benefit that you would avoid capital gains tax (via private residence relief) if you sold the property, though any gains may have been offset by the repair expenditure anyway (?) – not my area of expertise but worth researching.

    In some ways, it might be an advantage having to deal with this now given that you state it was inevitable at some point. You have more time to pay off the new mortgage plus as I’ve picked up from Monevator that some advocate that it’s better not to pay off the mortgage but keep investing!.

    Keep in sight that whilst you call it your Future Fund, ultimately it’s a pot of money that allows you to deal with situations like this – imagine how this would play out for your previous self (the spendy Weenie in her 20s/30s) . Yes, sure, you’d rather it was paying for an early retirement, leisure and pleasure but its secondary purpose is a large emergency fund.

    Keep rolling.

    • Hi NewInvestor

      Living in my flat does seem the simplest solution but as well as me not wanting to turf out long-standing decent tenants, it’s not in a location I want to live in – I would rather just move out the once, taking my worldly goods with me (which would have to go into storage if I moved into the flat).

      There is the advantage of dealing with it now rather than later – I’ll have to revisit Monevator’s post on not paying off the mortgage as I believe TI is on an interest only mortgage, though I’m not sure that’s something I could consider right now.

      It does not bear thinking about had this had happened when I was still spending like I was when I was younger, so thanks for the positive perspective.

  12. Oh, that’s frustrating timing. What is the rental market like in your area? Would you be looking to stay there after you are no longer tied to the area by your job? It seems a tough time to be buying a second home if a temporary rental would be a possibility.

    My mum does the same thing of assuming that I’ve been told something and then dropping a huge surprise mid-conversation. Hopefully you’ll be kept fully informed of other important news!

    Really hope you find somewhere that you’ll love living in. It’ll be annoying if you need to dip into the Future Fund but at least you have one.

    • Hi PWF

      Rents in my area are not cheap, not if I want to live comfortably. I would love to stay in the area but am considering +2 or +3 mile radius, so I’m still within a decent commutable distance (for when I return to the office) and not so far from my sister or my friends.

      Yes, I need to see the positives in this and be glad that I do have a Future Fund to dip into.

  13. I’m sorry to hear about your plan getting punched up. But plan B and plan C are there to be executed. I’d suggest you consider renting a small flat for 12 months while you sell your BTL. Once you are rid of the BLT and your parents house it might be worth talking to a mortgage broker (I once used L&C and they found me a great deal) . This would give you time to sort out a lot of the issues regarding your parents house and your BTL. The housing market should be a lot calmer in a year or two. It’s always worth keeping an open mind about living in a slightly different area that is less expensive (if that’s possible)? Best of luck!

      • Hi hal

        I have been considering renting but the rents are quite high if I want to live comfortably and I don’t want to move too far away and end up being miserable. Selling my BTL (with tenants in situ, another reason not to turf them out) to another landlord is my best bet after all the mess has been sorted but I don’t know when that will be.

        I think my choice would be to move out just the once, taking all my personal goods (and the family heirlooms such as they are) with me when I find my own home.

        I would have liked to have waited til things were calmer but family pressure’s on not waiting.

        Thanks for the words of support and yes, I will adapt – writing this post has already helped – not tweaked the spreadsheet yet but I’m sure that will help too – thanks for the interesting link and yes, I should have seen this coming and prepared for it.

  14. Hi weenie,
    So you may have been “blown off course” in terms of your long term plans. However it’s a case of resetting the coordinates for FIRE and “setting Off” again. Sounds like you are doing just that.
    Best Wishes

  15. Long time lurker, first time commenting.

    It’s woods and trees because your plans/life is changing. Close to FIRE/changes at work and a new home to find.

    However, I think renting for 6/12 months would put a different perspective on all of your 3 issues when you review sometime in 2022.

    You should be able to move into or sell the flat, you might decide to even retire or FU (work) for a while. Life changes are never easy but you still live in the best city in the country (I’m biased).

    You will be fine

    Keep posting as you are one of the best FIRE bloggers out there!!

    • Hi Lee

      Definitely a case of woods and trees! I felt completely lost and I think my mind shut down for a while because I found that couldn’t think my way out of the woods, as it were.

      As mentioned, renting has been considered but I’m not sure I could stomach paying the high rent (although I may save in the long term, it’s all psychological).

      Yes, by the time I come to sell my flat, I might be in a different position and may think of quitting – who knows and yes, I share your bias with the city 🙂

      Thank you for reading and for stopping by!

  16. Im just mystified that, since you don’t have to leave in a hurry, you just don’t give notice to the tenants in the flat that you own and move in there?

    A lot of other posters are asking the same question.

    Are you genuinely scared of the fire risk?

    • Hi Neverland

      No, I’m not scared of the fire risk (I’m paying for 24-hour fire wardens) but as well as wanting to do the right thing as a landlord and not turfing out my tenants from their home, I’d be moving from a 4-bed detached in leafy suburbs to a one-bed flat near city centre, which might have been ok when I was in my 20s but too much of a downsizing right now for me to consider when I have other options (albeit more expensive). I would move in if that was my only alternative.

      Also, the tenants have just renewed for another year and a BTL is more desirable for sale with a good, in-situ long standing tenant. .

  17. It may be overwhelming at present but there can be positive result like receiving redundancy pay and receiving job offer with in no time.
    Good luck Weeine!
    This too shall pass!

  18. Hi weenie,

    It’s not the best timing for such changes, but at least I am glad to see that you are managing to readapt your plan accordingly despite the pain. Have you thought about renting a nice room in a shared house until you get a chance to live in your BTL? You never know, you may find people your age and single sharing, it may get you to meet new interesting people 🙂

    Good luck weenie.

    • Hi Tony
      No, I hadn’t considered a room in a shared house but no, the last time I had just my own room in a shared house, I was a lot younger (22!). As I’m so much older and grouchier, it’s unlikely this would work for me!

  19. You can take consolation from the fact that your parents are still alive. Mine died too early. Chin up!

  20. Weenie,
    I hear what you are saying re “too much of a downsizing right now” but have you considered moving in with your sister as a stopgap after selling your parent home?

    • Hi Al Cam
      My Mum did suggest that, but I think me and sis have had enough of living with each other for a while – we put up with each other and supported each other during lockdown and this worked as we were effectively in a ‘neutral’ house. Things would be different if I had to move into her (smaller) house, her rules etc – our good sibling relationship would be stretched too much!
      But this wouldn’t be totally out of consideration I guess, I just won’t mention it to sis until as a last resort!

  21. P.S. and sorry to be a bit of a doomster:
    are you sure that you will be able to extend the BTL mortgage as you say it is currently unsellable or have I misunderstood?

    I feel something of your pain for similar but not identical reasons – but, as others have observed – it will pass.

    • Yes, I have spoken to my lender and they have said that I can borrow more on my BTL mortgage, though I won’t actually be extending it, so it’s over the same number of years.

  22. No easy choices here, are there?

    I wonder if when your mum says loan, she really means gift. There could be some tax/human advantages to see your heirs spend your money while you are still around to see them enjoy it.

    • Hi G
      Loans are paid back in our family, it won’t be a gift (other siblings will make sure of that, even if I didn’t!) and of course, this would be so that tax issues are avoided.

  23. @MarkMitchell

    When I confronted my sister, she made out that 1) Mum didn’t seem that serious about it when they spoke, hence she didn’t mention it, and 2) Mum should have spoken to me directly about it.

    It’s done, not worth getting into arguments over it and yes, moving in with her would seem like revenge but would likely punish me too, haha! (she’s a bit OCD…)

  24. Sounds like a stressful series of events, but also looks like you’re already forming a plan of action. I don’t have any words of wisdom to share but, after following your blog for several years now, I’m sure you’ll find the best solution! Good luck with it all.

  25. Sorry to hear this. One of my friends is in a similar situation except his cladding is the worst kind and he’s looking at a bill in the ten’s of thousands. Makes my blood boil that the developers can walk away from these issues unscathed and that building standards officers weren’t so rigorous during the build stage.

    I’m sure that this will be just a minor set back on your road to FIRE and you’ll soon be back on track. My 2 cents are that if you have to sell any investments sell the bonds and keep the equities as these will grow more. You could then add bonds back in once this situation is resolved.

    • Sorry to hear about your friend’s flat, mrmisanthropeblog and hope he is able to some government help with that bill.

      It is ridiculous that the leaseholders have been left with the bill as a result of shoddy regulations and building standards in the past.

      Hear what you are saying about selling the bonds and I believe Monevator mentioned this as part of his decumultion plans, to sell bonds down first, allowing equities to grow more. It seems to make sense so I will consider, thanks.

    • Thanks David but I don’t have the same financial brain or investing nous/experience as FIREvLondon to even consider that! I did read his post on that and just about understood what he did but seems too much of a risk (and complicated) for me to undertake.

  27. Hey Weenie.

    Sorry to hear about this turn of events. Sounds like you’ve progressed swiftly through the seven stages and come out the other side as clear-sighted and level headed as ever. The comments you’ve been getting have been very interesting reading and sound very helpful.

    Any withdrawal from your FF will soon be swallowed up by long term gains. I do feel your pain there though. You’ve taken a hit, dusted yourself off, put your goggles on and set your chin to the determined position. You’re gonna be fine.

    • Hi FIRE@55

      Not sure I’m quite clear-sighted or level headed just yet but it’s getting there and my headspace feels better than it did at first!

      Thanks for the kind words of support.

  28. Families! Probably not fair to pass any judgements but if the situation arose in mine i’d like to think that the other members would take into account the position of the custodian of the property. There’s a lot of upheaval involved for the occupier (as you’ve already commented on from your own tenants perspective). It doesn’t sound as though the proceeds of the house are required urgently for anything so i’d be thinking along these lines….
    Do i want to remain in this property? If so, how do i go about achieving that?
    Could i arrange to sell my BTL property (in a years time), and use the proceeds to part purchase the family home?
    Then, and this is where it might get tricky, could i negotiate an early inheritance and use that element to complete the purchase of the family home?
    If more funds are required, could i get a good friend to part purchase the property with me? Or maybe even get property hungry QS readers to invest for a given timeframe (10 years say) and then at the end of it you sell up and move on. A complex suggestion though, and unlikely to be practical.
    Random comments but i just wanted to pass on my support to you at this time of stress.
    As my dear old auntie always says (and she just so happens to live in the ‘family home’) “There’s a bed here for you whenever you need it”, and i’m reasonably confident your family and close friends would say the same, were the unlikely situation ever to arise.

    • Hi KC
      Sadly, the equity in my BTL property is nowhere near enough to even part-purchase the family home. Whilst the siblings are sad that the house will be sold, none have expressed any wish to keep it in the family or any alternative ideas. Inheritance – that’s not something I would bring up – nobody has mentioned it so I’m not going to be the one to do that.
      Thanks in any case for your comments and support, it’s much appreciated.

  29. Oh, Weenie, this post really got to me and prompted me to respond.

    I am so sorry to hear about the difficult position you’ve been put in. I’m sure your Mum didn’t intend this, but the upshot of her actions is that you’ve been blindsided and must now deal with a situation that is a practical, logistical and emotional nightmare at the moment.

    That being the case, I would urge you not to feel in the slightest bit awkward or bad about taking the loan your mother has offered you. I truly feel that now is not the time to hesitate about accepting help (fiercely independent though you are 😉 ). In fact, I would go so far as to say you should borrow the maximum amount your family is willing to lend, so that you avoid having to plunder non-cash funds any further, and can also keep your btl mortgage as low as you can.

    So those are my thoughts on the difficult side of the equation. Moving on to the more positive side (yes, I think there is one!) Whilst this is an unwelcome bolt from the blue for sure, once all the dust has settled I reckon you’ll look back and feel really, really glad it’s all done. However comfortable the current situation felt before, there was always that issue dangling over your head that you’d have to move out at some point and buy your own place. That made you something of a hostage to fortune, I suspect. Particularly as, like me, you’re not as young as you once were ;).

    May I also offer a final observation on the dangers of allowing yourself to become the ‘keeper of the family heirlooms ‘, lol? I speak as one who’s been there, and this is a thankless task. If there are pieces of family furniture or ornaments that you love and would like in your new home, then by all means stake a claim to them with your other siblings and take them with you.

    But please, don’t let yourself get pressured into filling your new home with stuff that you don’t want or like but that you feel obliged to hold onto for other family members. If they want things, they can take them when the house is sold – if they don’t like them enough to put them in their own home now (or pay to store them), then they probably don’t really want them at all and the items should be sold or donated.

    I know this issue can be freighted with all sorts of family tensions, but there will never be a better time to put your foot down!

    Phew, that was a lot of comment. I wish you all possible luck and good fortune to find your own lovely forever home.

    Jane in London

    • Hi Jane In London

      Your kind and thoughtful comment made me want to weep as it was as if you were able to look into my head and see all the stuff going on inside! I hadn’t thought looking to push for a max amount from my parents, so thanks for that tip. I think you are right that things will work out positively in the end, yes I knew I was always going to have to move out – my mistake I think was that my plan somewhat had me foolishly believing that I would always be moving out at a time of my own choosing.

      And yes, the family heirlooms – nothing really valuable but probably more momentoes, that kind of paraphernalia – fortunately, sis will be helping me out there (it’s also so she can take what she wants herself!).

      I think what distant family members want to keep will ultimately be shipped over to them.

      Thanks, your words have really helped me.

  30. Hey Weenie.

    I’ll keep this short since you have so much great support already and I know you are more than capable of figuring out the best way forwards for yourself.

    So just to say it may sound trite but honestly, so often in life it’s the cr@p situations that have ended up moving me onto something better than I even thought possible. I know you’re wobbling right now with the big change but I have no doubt at all you will bounce back.

    Plans change, we adapt, we move on. And if we’re really lucky we even learn something

    • Hi Michelle

      Yes, once I’ve gotten over this initial wobble, things will be better. Nobody likes unexpected change, I just need to adapt my plan and move on. I will get there.

      Thanks for your continued support.

  31. Hi Weenie,

    It’s understandable you are confused with the ultimatum and your mind is busy processing and weighing up the different options. Once the initial confusion clears a little, you will know what you want (even if instinctively) and from then on things will get easier.

    My two cents: I see that you are happy in your parents’ house. I think it’s extremely important to feel content with where we live. From own experience, living in a place I like puts me in the right frame of mind to focus my thoughts, energy and actions on pursuits I enjoy. It makes life easier and lighter.

    If you are happy with where you are now, perhaps you could consider buying the house from your parents – even at a market price? The price from what you said is high but if they can give you a loan, why not use it for this house? Remember you can rent out a room (or more) and the rental income is tax free for up to 7,200 per year. I did this for sometime and it helped me a lot with repayments especially in the early years when the mortgage was high (it’s very low now). Btw, I also took a loan for the deposit which I managed to pay back in full. I would not be able to make it without the loan.

    • Hi River Mermaid

      Yep, once the fog and confusion has cleared completely (and things are a little clearer now), it will get easier.

      Unfortunately, buying my parents’ house is out of the question (out of my budget, even at market price) and any proposed loan won’t cover it and I don’t want to be saddled with an unaffordable mortgage. So yeah, I will need to find somewhere I will be happy to live in, whether this property will be my forever home or just a stop gap before I find it remains to be seen.

      Renting a room out when I’ve got my own place could be a consideration but I’d have to weigh up whether I would want to share my house in that way for financial gain.

      Thanks for your kind words of support.

  32. I follow but rarely post. However we are almost identical in our FI journey. Same age, years in DB pensions, similar net worth, just allocated differently, and both living in cheap “house guardian” style setups. However, I’ve always known ultimately my FI funds would need to pay for housing. I brought this up with you a few years ago as I couldnt understand your FI plan without this factored in. If of any comfort I liquidated everything to cash in Dec 2019 when I had an offer accepted on a house. As another poster said, all you’re doing is transferring wealth from one place to another. I’ve done it, it’s no big deal, it was inevitable, ive “started again”. You are extremely lucky to a) have parents and b) parents that will give you a pay back loan. Good luck with the house hunt, and have a firm list of “must haves” and “can compromise”.

    • Hi Starla

      Yes, I recall you asking a couple of years back about my living arrangements. My FIRE plan factored in that I would either by paying rent (and still receiving BTL rental income) or with a mortgage on a house purchased using the equity from my BTL. I was coming round to the idea of the latter as I realised I no longer wanted the hassle of a BTL but could never have planned that I wouldn’t be able to sell my property due to fire regulation/cladding reasons. The rental income which I have been putting to one side which would have also gone towards purchasing a property is now being used to pay for my higher service maintenance charges and ultimately, whatever the ‘cladding bill’ will be.

      I realise now that I am just transferring wealth – brain fog didn’t let me see it that way at first!

      Thanks for the kind words and yes, I am extremely lucky.

  33. As per the previous post I also had been wondering where housing fitted into you FI plan.
    It always struck me that you were somewhat short.

    • Hi Russell

      My FIRE plan factored in that I would either by paying rent (and still receiving BTL rental income) or with a mortgage on a house purchased using the equity from my BTL. I was never going to be one of those mortgage-free FIRE’d types.

  34. I have also wondering about how you were going to fund your housing and still retire early.
    From the article featuring you in the press you’ll have enough to live on once you get your state pension.
    The numbers for early retirement just don’t stack up.

    • Hi Dave

      As per my reponses to comments above, my FIRE plan factored in that I would either by paying rent (and still receiving BTL rental income) or with a mortgage on a house purchased using the equity from my BTL.

      With no kids to pass my worldly assets to, I’d probably convert the mortgage into one of those lifetime/equity release ones in time, so the bank will get it once I pop my clogs.

  36. Hi Weenie,

    I’d speak with your parents and suggest they stall the sale of the house until things improve with the old Corona. In the meantime stick as much money in the bank as you can.

    When the house goes sell everything you own which cannot fit into a suitcase.

    Leave the job and go live somewhere in South East Asia – Vietnam springs to mind – do a spot of English teaching to keep your mind active.

    Your nest egg at a drawdown rate of say 4% would be plenty cash for you.

    Job done retired / time on your hands.

    • Hi Philip

      I have spoken to them but their minds are made up.

      As for packing everything in a suitcase and heading to South East Asia, that could have been something to be considered but 30 years ago, not now – I have no desire to start all over again and live in another country.

      • Hi Weenie,

        I totally understand your thoughts regarding staying in the UK. However, I have a number of friends who have left ….. after building up nice share portfolio (compound interest machines) often combined with a rented property; leaving the UK (temporarily) has literally brought forward their retirement by over 10 years.

        It’s something which I plan to do …. Just need that magic £500k in the ISA / SIPP!

        Best of luck with everything and I’m quite confident as the world moves out of Covid your investments will echo the rising economic situation.

  38. Hi Weenie,

    Just catching up on reading blogs so my apologies for being behind the curve here.

    If it’s any consolation, my thoughts on reading your post and the comments were that you really seem to have your head screwed on here, and a bit of a wobble is more than justified by the situation!

    The cladding / fire safety issue is an absolute nightmare. I used to own flats in Manchester, all in the same block (bought new in 2009). Thankfully my strategy was to sell within five years; the build quality was generally poor so I figured they really weren’t going to age well. Like an idiot I was thinking about kitchens / bathrooms / general condition for resale. Little did I know just how god-awful the build quality would turn out to be!

    You have to feel for all the leaseholders (I feel guilty every time the bl***y place appears on the evening news, even though I sold well before the Grenfell fire) stuck in an absolute nightmare scenario while the powers that be fiddle (I mean in the Nero sense, but hey, who knows these days).

    Good on you for being such a good landlady to your tenants. Absolutely right that you can’t really kick them out of their home after 4 years, and moving back in might only make a minor dent in a future CGT bill in any case.

    My big question is how do you make sure that a property you buy now is the right one for your future FIREing self? I appreciate that you don’t want to end up moving twice by renting now before buying later, so I guess you wouldn’t want to buy now then end up moving again when you FIRE? Does your future FIRE budget end up constraining your property purchase budget more than current affordability (deposit / ongoing mortgage cost) alone would?

    I think the idea of dangling a carrot in front of estate agents is a good one. Maybe get a few round for valuations? You can then keep stringing them along as long as required, you being but an intermediary and the elderly decision makers being in HK and needing to be guided by your advice and judgement at every step blah blah blah…

    Best of luck. Your forever home is out there and just waiting to be discovered.

    Jo

    • Thanks for the detailed comment, Jo.

      Re the cladding – I’m impacted as a landlady, I can’t even imagine how much worse it would have been if it was my home, like other leaseholders.

      As for making sure the property I buy now is the right one for my future FIREing self – it’s a risk I will be taking while I’m house hunting. I have thought about renting, storing my furniture and belongings and then waiting to find that perfect forever home, but I’ve decided that it will be less stress less buying, rather than renting. It’s possible that I could end up moving again when I FIRE but let’s hope not.

      My future FIRE budget doesn’t really constrain my property purchase budget, but I will be taking a look at my numbers again in case there’s something really amiss with my spreadsheets!

      Estate agents are so busy that they’re not replying to emails. However, they still respond to good old face-to-face meetings, so I spent my day off going to local estate agents and I finally have a couple of viewings lined up.

      Thanks very much for your kind words of support.

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