For example 2 months ago I paid off my student loan. This was £330 per month. However, in the following 2 months we've not saved a penny.
Further example is that 2 years ago I was earning £51500. That is nearly £18k less than what I earn now. However, we have no savings to show for it. Granted the priority in this time has been paying down debt and we have achieved that.
So my plan is to plan and as soon as additional income comes available have a decision already made to automatically move that money each month so it's not missed.
Upcoming changes in circumstances.
- Potential pay rise eta March / April 2017
- Roughly £50 per month
- Bonus eta March/April 2017
- Roughly £3000
- Tax code change eta May 2017
- Roughly £100 per month
- Paid off Credit Card eta Sept 2017
- £50 per month
- Paid off House Loan eta Sept 2018
- £281 per month
Options for what to do?
- Cash savings.
- Stocks and Shares ISA.
- Pay off mortgage.
If I commit
- Any additional pay rise income to go into Stocks and Shares ISA. We've proved that we dont store cash very well so will use monthly surplus to top up cash savings.
- Commit to split the bonus in 3. One third to cash savings, one third to S&S ISA and one third towards treat for the wife and family.
- Commit to adding tax code changes to S&S ISA.
- Credit card re-payments can be used for cash savings.
- House loan is too far in the future to consider now.
What I'm interested in is increasing the monthly amount I save into the S&S Isa.
Currently this is £50, starting 2nd Nov.
With pay rise and tax code change additional income this should increase to £200 per month by the summer of 2017, as well as a one-off bonus amount.
I have started considering what my 2017 goals are likely to be. It's early but I'm excited as it'll be the first year where the focus is turning to wealth accumulation rather than debt repayment. With £400 already invested in PPBF shares the aim should be completing 2017 with around £2.5k held in stocks and shares, with a further £1.2k invested in my company share save scheme.