Le rêve est mort?

After a lovely relaxing holiday in August, I was brought back down to earth and reality not by my brimming work inbox but by an email from my current mortgage provider, reminding me that my fixed rate mortgage deal was due to expire and to consider their current mortgage product offers. If I did nothing, I would automatically revert to their standard variable rate of 8.4%, so doing nothing was definitely not an option!

Their deals were not pretty – they were all variable apart from one 2-year fix that was offered at 6.4%.

Whilst I’d been preparing myself for a big jump in interest rate (from the now almost mythical 1.25% I’m currently paying) by playing around with mortgage calculators, checking affordability and such like, it was jarring to seeing the numbers in black and white. I see now that I’d been somewhat optimistic with my calculations and wishful thinking about interest rates dropping. Or that getting my LTV down would actually make any real difference.

I contacted an independent mortgage adviser, one recommended by a friend who had just recently herself remortgaged.

Unfortunately, the best 2-year fixed rate deal would have resulted in me paying nearly an extra £300 per month for my mortgage (a 55% increase!) so I had no alternative but to look again at my current provider’s offers, where at least there would be no arrangement fee, nor would I have to provide all my financial info again.

Their best offer would increase my mortgage by £240 a month (a ‘mere’ 44% increase), a 2-year 5.30% variable rate. With the rate being variable, this might go up, so I could end up paying that extra £300 (or more), but there’s also a chance that this extra could decrease a little, if/when the interest rates fall. I’m more inclined to think (and will take the gamble) that they will likely drop, though by very little and certainly not in the short term. I reckon in my lifetime, <2% mortgage rates will be consigned to history, we’ll look back and think of ‘the good old days of borrowing’! At least we’re not back to the double-digit rates that my parents were paying for their mortgage.

I still have a month to go so I haven’t signed up to anything yet, but not sure I want to leave it too late in case even that offer I’m considering is withdrawn.

How will this affect me?

Despite shouldering all financial burdens on my own, I’m in a fortunate position in that this not-insignificant (to me) increase to my monthly mortgage payments still isn’t going to result in my struggling to keep up with payments, getting into arrears, having to choose between heating or  eating, resorting to food banks or pay day loans.

But it’s enough that it’s probably going to have some impact on my every day lifestyle; how much I’m able to put aside for my social life, holiday funds, house repairs, emergency funds, overpaying the mortgage.

Ultimately, how will my increased mortgage payments affect my ability to continue adding to my FIRE savings/investments and advance towards my goal (shifting goalposts notwithstanding)?

I’d like to think that I’m quite mentally resilient, of  stoic-ish nature but I can’t deny that increasing costs in pretty much everything have been causing me a bit of worry, about my plans, about the life I lead.

For the first time in a long time, since my debt paying days, I’m considering running a proper budget, tracking all my spending to the penny.

It’s not a task I relish, in fact, it fills me with dread and I could almost sense a small cloud of doom and gloom coalescing above me.

Bills, Bills, Bills

I have some unavoidable and quite significant expenses looming on the horizon, costs that I can’t really put off much longer or ignore.

In no particular order of urgency (since they all need sorting out):

1 – Dental costs – that private dental referral from March has finally come through and they called me to make an appointment. I’m no longer in pain but still can’t really eat on that side of my mouth. £99 paid in advance just to see the consultant and then, he will diagnose whether I need root canal treatment or extraction. Cost estimated to be around £1-£1.3k.

2 – New Glasses – my prescription has changed these past couple of years, so I need to get new glasses to avoid eye strain and headaches. Cost estimated around £350-£450.

3 – Car repairs – the advisory issues flagged up in my MOT need to be sorted as I don’t want them to balloon into reasons for my MOT to fail (and for safety reasons, as one of the issues was to do with my brakes). My air con isn’t working but I’m deeming that an unnecessary nice-to-have right now. Cost of repairs quoted at £700. I also have a slow puncture. Every week or so, I need to check the tyre pressure and pump up the tyre. That will cost another £100-140.

That cloud of doom and gloom continues to spread over me…


The other week, I got a last minute “quick catch up” meeting invitation from one of the big bosses in the US, my ‘interim boss’ since my previous boss had left at the end of July. I thought (with some relief) that the meeting was probably going to be news that his replacement had been found.

Only it wasn’t that – I was being given an unexpected pay rise.

I had already received a performance-related pay increase earlier this year, so I was rather speechless to get this extra increase on top!

The reason? A ‘reward for continued excellent services’. Okaaaaay…

Well I didn’t want to question it so just mumbled, “Wow thanks!!”

My mind was reeling (in a positive way), however at the same time, my chimp brain couldn’t help but negatively wonder what this actually meant. Did it mean that they weren’t going to replace my boss and that I was going to be given extra duties? Was something else on the horizon that would affect my workload and this was a sweetener to keep me happy?

Anyway, two days later, I was notified that my new boss had just accepted the job offer and would be starting in a couple of months – hurray!

Four days later however, I found myself part of a new project team, to help with the integration of a recent company acquisition. Looking at the project plan, I have been assigned a lot of tasks so my workload will go through the roof.

Is it bad that pay rise or no, I would have still signed up for the extra project tasks because that’s just the kind of ‘worker bee’ I am? More fool me, perhaps.

I’m really grateful for this extra pay, which won’t quite cover the entire monthly mortgage increase but will give me a lot more breathing space, makes things more manageable and me less stressed about it.

Annoying that in more ‘lower interest/lower inflation’ times, I would just be throwing the extra into my ISA or SIPP and not succumb to lifestyle inflation but I don’t have a lot of choice right now.

So in answer to the title question of this post, “Is the dream [of FIRE] dead?”, I’d probably say “Pas encore!“.

Onwards and upwards as always!

[Note, for those interested, I am still learning French via Duolingo! 431 days and counting!]


29 thoughts on “Le rêve est mort?

  1. Hey weenie. Thanks for your update. That’s a huge increase on the mortgage front for sure. It does sound like a double edged sword getting that pay promotion which at least offsets some of it but then gives you more responsibilities. I hope it doesn’t make work feel much worse for you due to that extra pressure and workload etc. I hear what you mean totally about increased costs in general too, I am dreading my car insurance renewal as it will factor in a claim I had and also will likely be higher anyway, I also need to service my 12 year old car for the last time…all the best weenie. TFJ

    • Cheers TFJ.
      Yes, double-edged sword on the pay rise/extra duties but it’s given me some breathing space at least. I just need to manage my time. All the best with the car insurance renewal and the car service!

  2. Nice honest update Weenie, reminding me that life is what happens while we were making other plans! As long as you continue with your strategy of “quietly saving” I’m sure you’ll see this current bumpy ride through. Onwards and upwards, as you say 🙂

  3. This weekend I came across a note I’d written to myself on whether to open a fixed rate Cash ISA with Nationwide. The interest rate was 1.25%. I notice that their current fixed rate ISA pays 5.6%.

    We’re paying the cost of the great repression of interest rates following the financial crash of 2007/08/09. Gordon Brown claimed to have saved the world but unfortunately the world didn’t bother to change policy once the emergency had passed. So we had more than a decade of Brownonomics and now the birds have come home to roost.

    Stick it out, Weenie – that too shall pass away.

    • Hi dearieme
      Indeed, what’s happened is as a result of policy decisions made in the past, compounded by recent global events. It was inevitable that interest rates were going to go up but I think we all (naively) assumed a more gradual increase. Yes, this too shall pass, or will just be the ‘norm’.

  4. Congrats on the pay rise.
    I’ve not run any numbers, and i’m no expert in the mortgage field whatsoever, but i’d imagine that once you turn 55 and the TFLS in your pension becomes accessible, depending on the elevated state of mortgage rates at the time it might make good sense to get yourself debt free asap. If i had a mortgage i think i’d be looking round the house right now to see if i could find any items of value that might be sold off to reduce the relatively expensive debt. It’s obviously a fine balancing act between holding assets and reducing debt, but with each increase in interest rate more assets must surely come into consideration for disposal (eg premium bonds).
    I’d also be off out to the front garden to start digging it up in preparation for planting some emergency spuds next spring! Every little helps as they say.

    • I might put the spuds in the back garden and Jerusalem artichokes in the front. The public probably won’t steal the latter. The combination, with a little bit of bacon. makes a wonderful winter soup.

      • Believe it or not i do actually have a couple of clumps of JA’s happily growing away in the front garden, along with my much prized yacon plants. If you like the taste of pears and honeydew melon, yacon is the poor man’s equivalent and i can highly recommend growing some. They’re unique and i can’t wait to harvest them in December…..providing none of the locals get wise and beat me to it!

  5. Hi Weenie, I found myself in a similar situation, with the current rate at 1.14% due to expire. I decided to pay the mortgage off. I know all the theory re opportunity cost, but sometimes you just cannot put a price on the peace of mind a debt free status brings! Whilst FI is important, I am now less sure about the RE part. I love my job and the intellectual stimulation it brings.

    • Congrats and well done on paying off your mortgage, Donna.

      If I liquidated most of my ISAs, I could pay mine off in full but then I’d not be able to retire early and that is still very much the plan.

      Although l don’t love my job, I do like it and my colleagues and I know I would miss it when I’m no longer there.

  6. Hi Weenie,

    As ever your very candid writings resonate with me, being in such a similar position, age, wealth, targets etc. I’ll try to tackle this is bite sized portions;

    Mortgage: I have another 2.5 years to run on a 5 year fix at 1.29%. I’m clearing the lot (6 figures) by the end of the term. It’s killing me, I don’t get any leg ups by family, this is earned, saved and some work share schemes. Like Donna above it’s the peace of mind and avoidance of wasted cash on interest. It comes at a price and I haven’t had an overseas holiday since 2018 for example. I’m still very much enjoying life, but in very different, simpler ways. Short term pain etc.

    Pension: While I don’t have to shoulder the interest rates you do, work closing our DB scheme to further contributions 18 months ago, means the extra contributions I need to put into our DC scheme, to get vaguely close to the same benefit as my old DB, is the equivalent of a 20% pay cut. On top of raging inflation. The squeeze is real. Ok, I could not put the amount I do into my pension, but for many reasons, this is the LAST cut I would make.

    New glasses: I get my prescription and glasses done at Specsavers usually. Next year I’ll get my prescription, but I’ll order through Glasses Direct at a huge saving.

    Tracked Budget: I read “Your Money or You Life” at the start of my FI journey in around 2012 and one exercise for a month is to track your spending to the penny. I created my own spreadsheet and have done it every single month since. I’m not obsessive, I don’t brood over what I spend, but I am accountable to myself. When people say “I don’t know where my money goes” well I do. I have a set budget each month which also preps me for retirement so I know my figures are realistic. I know that this month that I’m feeling the pinch and I’ve spent £120 on work lunches and “just nipping to the corner shop to get some milk”. Obviously I’m not going to stop eating, but I could do things differently, maybe make my own soup, get creative and healthier in the process etc. So it’s less about being “miserly” absolutely not, and more about being able to channel your resources away from where they are wasted, and to things that bring you more joy. I can’t recommend it enough.

    I hear you, my FIRE date keeps getting pushed back but I’ve decided that pensions and savings continue on track and I’ll make other cut backs instead. 4th April 2028 is my date to step out of corporate work.

    Congrats on the silver lining, the pay rise, you are clearly well valued!

    • Hey Starla

      Sorry for the delay in reply to your wonderfully detailed comment. I do love to hear from you because as you say, we are in similar position, age, wealth, targets etc.

      Mortgage – That’s great that you will be in a position to clear your mortgage at the end of the fixed term – well done to you for maintaining a lifestyle which you still enjoy, while continuing to put aside the money to pay off your home. I will review my own position in 2 years’ time.

      Pension – I have a frozen DB from my last company I worked at and I’m just glad that I continued to contribute right up to when they too closed it to further contributions. My current company matches the 5% that I pay into the DC pension. I’ve occasionally reduced the monthly amount I put into my SIPPs but want to be continuing to add to it on a regular basis to keep it ticking up.

      Glasses – I am off to Specsavers this weekend; I’ve had mixed reviews from my friends from ordering glasses online.

      Tracked Budget – Whilst I don’t know where every penny goes, I do mostly know where my money goes each month. I check my bank accounts regularly so know when I’ve overspent or if I have surplus at the end of the month which I can add to my ISA (doesn’t happen very often these days, sadly!) I have a spreadsheet tracking my grocery spends but that’s it – I think the reason why I feel so averse to tracking every penny is because I did this for several years while I was paying off my credit card debts, so the task does not fill me with any sense of joy, just a remembrance of those dark days!

      All the very best, Starla, with your date of 4th April 2028!

  7. Commiserations on the mortage but well done on the promotion. Is that karma?

    I’ve recorded all my expenditure on a series of spreadsheets since 2010. At first it was a terrible bore but now it’s become almost a hobby. In doing so it has given me an insight into how much I spend and on what; the relative increases/decreases of items over the years and it allows me to divert additional monies to savings rather spend them on frippery. I would recommend it to anyone (at least for a while).

    My exit date is 31th March 2025 (hopefully) with a sufficiently big DB pension and savings that I’ll draw upon until my State Pension at 67 which combined should equate to about 70% of what I currently on after tax.

    • As my comments above, I completely agree about spreadsheet tracking. The most valuable aspect is it allows me to know how much is enough in retirement (while currently living on a lot less than I will when I retire, therefore knowing my figures are completely realistic). Do it Weenie!

      • Hi again, Starla

        I will need to update my annual expenses spreadsheet given the change in mortgage, so this might prompt me to track in more detail. Thanks! 🙂

    • Hi Grumpy Tortoise

      Thanks and ha, perhaps it was a little karma!

      As mentioned in my response to @Starla’s comment, I run a spreadsheet for my groceries and that’s it. With the increase in mortgage, I will need to do a rejig, so perhaps time to refresh my ‘annual expenses’ spreadsheet.

      All the best with your 31st March date!

  8. Sorry that it’s been a stressful financial month, Weenie. Sounds like the payrise was perfect timing though.

    I don’t know if this will help, but if you have contact lenses as well as glasses then I’m on a monthly plan with Specsavers for £15.50. It includes all eye checks, a free pair of glasses from their basic range and the option of a second pair from most other ranges at half price. Even if you don’t use the lenses, it works out at £186/year, which might be cheaper than getting glasses separately. You can always cancel after the minimum period if needed.

    Also, if you shop at Lidl then I like the Lidl Plus app, because it tells you how much you’ve spent each month. If you realise that you’re spending more than usual then it acts as a reminder to cut back a bit, which is handy.

    I do wonder how the average financially-illiterate household manages to cope with things like a higher than expected mortgage jump. If it catches even people that track their finances unawares then I dread to think about some of my family members, who barely understand how interest rates work and stick all bank letters in a drawer to ‘deal with later’. Some tricky times ahead for many, I think.

    • Hi Sarah

      Thanks for the headsup on that Specsavers deal – I’m there this weekend so will check out to see if the deal will work for me.

      At the beginning of the year, most of my shops were in Morrissons – now, I mostly shop at Aldi. As winter is almost upon us, I’ll be batch cooking soups, stews and casseroles so easy (and cheap) meals.

      I think I’m in a bubble (with friends, family and colleagues and this blogging community) where increased costs in living means just cancelling or cutting back on some nice to have/luxuries.

      I hope all works out fine for those family members of yours who might be struggling.

  9. Hi Weenie,
    Thanks as always for the transparency – and congratulations on the unsolicited payrise! On the mortgage front we went from 1.74% to 6.15% – the best we could get which would have resulted in a huge increaase of payments (a shade under 4 figure increase….) – but years of overpaying has come to the rescue on that so we definitely dodged a bullet! In addition utilising spare ISA allowance to build up extra cash flow has helped. I knew at some point rates would have to go back up so I have spent the last 10 years preparing for it – otherwise we would really be up a certain creek (well ok, maybe not but the savings would suffer, unlike other (possibly less fortunate) folks who didnt save…

    If it helps, I have been tracking every penny of my spend for nearly a decade now – and I have noticed this year in particular costs have really gone up – my spend is up over 10% but there is a sad part of me that quite enjoys it, makes it more of a competition to try and reduce expenses! I don’t budget as such, I have money and it goes, but I know where! Categorised, tracked each month means I can see how my cost of food has gone up (albeit with a switch to more organic, healthier foods etc.)

    I feel your pain on the glasses front – both myself and the other half need new glasses, and because of our sight the lenses are approximately double what you quote for yours – if you get to the stage of needing varifocals be warned!! I did compare on Glasses Direct – I could get them cheaper, but these are specifically measured against my head/eyes/ frame and thinned etc. The cost also excluded the frames 🙁

    Above all- dont give up the fight! It will happen as long as you keep plodding away – I actualy diverted £50 a month from trying to rebuild my heavily battered cash reserves into a GIA and buying 1 VHYL a month – I will us to pay some of my taxbill each year, anything else will go on pure discretionary spending!

    As for FIRE date? It will happen, but only when I am comfortable for it to happen!

    • Thanks FiL, hope all’s well with you!

      Well done on overypaying your mortgage over the years to dodge the massive hike bullet!

      Seems like tracking every penny is the way to go – as mentioned above, I might start doing a bit more and then see how it goes for my psychologically.

      On the glasses front, I do have varifocals but I think as my prescription isn’t very strong, the fees aren’t as high, although I’ve of course yet to see the results of inflation this time round!

      Thanks for the continued support, I will keep plodding along and adapt as obstacles are thrown my way. I recall you had a pot of investments for ‘going to the pub’- how is that coming along? 🙂

      All the best with your FIRE date!

      • Hi Weenie,
        Its been a while for sure, life still goes on 🙂
        Yes – hard at the time, but now oh so worth it, will still hurt but could have been far far worse.

        Tracing is a pain, but you get used to it – I know where every penny I have spent over the last 8 odd years went – the biggest eye opener was realising that I had my one off every single month, so adjusted accordingly!

        Yeah varifocals are a pain – but I also went for the top end to get maximum viewing range, which is good!

        Keep going, the ongoing plugging away keeps adding up and before you know it you will get there! The Go T’ Pub is doing great thanks – last quarter it threw out over £600, so the worst case is this can help on the mortgage too, but of course I want it to keep growing in the ISA if I can!

        Thanks on the FIRE date – I see it closing in, but I know the pssychological side will be my problem!

  10. That’s a wicked mortgage increase! At least you are financially literate and are able to manage the situation. Well done!
    But I know how you feel.
    I’m in NZ and retired a couple of years ago and seeing the markets sag is no fun at all.
    Just recently we received our house & contents insurance renewal invoice and it was up by 50%, I phoned around and all insurers were much the same – nothing for it, but to stump up the cash!
    Our council rates have increased a similar % over the last 2 years as well.
    A bit of history – we got our first mortgages in the early 80’s, 1st mortgage at 7% and 2nd mortgage at 14%. Within 2 years these rates had doubled, yes literally!

    FWIW, I believe that after the GFC the interest rates were held artificially low for too long and had they been allowed to revert to a more “normal” level we may not have ended up the mess the world now finds itself in.

    Something else i find hard is to see the reducing numbers as we start to deplete our savings pots, although we know that is why we saved.

    • Thanks Peter and yes, as per @Sarah says, how do more financially-illiterate people cope in these situations?

      That mortgage increase from 7% and 14% was just insane! My first mortgage in the 90s was around 8% but it never got higher than that.

      I agree with you in that interest rates are now appear to be reverting to the ‘norm’, or what ‘norm’ should be. Those years of mega low rates and cheap borrowing will now cause years of pain as people cope with the change.

      Hope you are enjoying your retirement and I understand how after years of saving and building up your pot, it’s hard to see your pot going down as you spend it. I hope you are having fun doing so!

  11. Well done on the pay increase you must be highly valued.
    I would agree with a variable rate,you just need to ride it out and be rewarded with a house at the end of it- fire or no fire you need to live somewhere. The fire ambition is still there for the taking and I am sure you will continue to rise to the challenge- keep the faith
    Well done on the French lessons ,you have inspired me to download the duolingo app just need some discipline now …..

    • Cheers Vespaboy!

      Yes, I just need to ride out this variable rate, think it might take a couple of months for me to settle into this new ‘financial routine’ but I will keep at it.

      Good luck with the Duolingo – what language were you thinking of learning, French also? I still find it fun and treat it as an educational game!

    • Hi Al Cam

      No, I had heard of those kinds of mortgages but hadn’t considered in this instance as they weren’t appearing in the mainstream press. It looks interesting, but perhaps something to consider in 2 years’ time when I need to be hunting for another mortgage deal.

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