We spent 5 years saving for our first home – and it was worth every minute – here’s why we chose to save such a large amount
Today I want to talk about what I consider to be our biggest financial achievement to date – saving almost £50k to buy our first home together. A lot of my money saving skills were honed during this time. But this isn’t a post about how we did it, more about why we did it. Why we waited so long. Why we saved as hard as we possibly could.
It wasn’t easy. It took sacrifices and working three jobs and missing out on holidays abroad, but in the end it was so, so worth it. To have our house we are slowly turning into a home. To know that we can afford our mortgage even if one of us loses our job. We can start a family without worrying if we can if we can still pay our bills.
Where we started
It may sound corny but when I first started dating my now husband, Pete, I knew fairly quickly I was in this for the long haul and that he was the one for me. After around three months we started talking about moving in together and decided that renting was not for us. It just seemed like wasted money.
So we continued to live with our parents and started to save, aiming for around a 10% deposit. One night we got chatting to one of the locals in the pub where we both worked and he suggested aiming for 30%. Better rates, more likely to get a mortgage etc. So, our aim changed and we carried on saving even harder.
During this time Pete was made redundant and was out of work for six months. He wasn’t entitled to job seekers allowance because we had so much in savings. I was also made redundant in the same year but the company was able to find me a few hours elsewhere – not full time but better than being completely jobless. I ended up taking on another two part time jobs to make up my income. I was eventually made redundant from one of these too! Not an easy time, but we managed, although we did end up dipping into our savings a little.
I would like to mention at this point that none of our jobs have ever been particularly well paid or high salaried. Neither of us have ever been earning much more than the minimum wage. Our average salaries over the last few years have been between 12k-18k and a year and a lot of that has been bolstered by overtime rather than regular hours. The average U.K salary is £26,500 so we are both well below that.
Eventually we both found full time work (working together at a pub) and had our first mortgage interview. We could actually borrow around £125k which with our £25k deposit meant we could look at houses around the £150k mark. However, we didn’t want to overstretch ourselves so we only looked at houses £110k or under.
We found one we loved, a three bed Victorian terrace. We put in an offer which was accepted. We officially started the mortgage and purchasing process.
Around a week later we went in to work and our boss told he was selling the business. And if he didn’t sell within three months he would be shutting up shop. Wonderful. We could both be jobless. We pulled out of the house sale and started job hunting. Luckily we only lost £250 as it was at such an early stage.
Our second attempt
Our second attempt at buying a house was much more successful. We both managed to gain long term, less shaky employment at a nearby business. They were happy to have us on board and we both still work there now, two and half years later. We continued saving and eventually were able to put down a £35k deposit as well as having another £15k in savings for fees, buying furniture etc.
This time around we had a much better financial adviser, who was very focused on affordability. It was actually quite shocking how much house prices had gone up in just over 18 months. The house we bought is actually a bit smaller than the one we were buying before and cost £16k more. But it was nice to finally get there and buy a house we are now slowly turning into a home. I’m really proud of our Biggest Financial Achievement and really hope I can encourage other people to do the same thing!
What our Biggest Financial Achievement means for us
Saving up such a huge deposit has meant a lot of things for us. It means that our mortgage is less than £400 a month and that we will only be paying it for 25 years (saving in interest against a 35 year mortgage). It means we would comfortably be able survive on one income if one of us were made redundant, was ill long term or if we decide to start a family.
It meant we were able to afford our dream wedding just a year after buying our house. It means we are comfortable enough to have an amazing honeymoon planned for next year – the first proper holiday we have had in years! That huge initial outlay has given us a certain level of financial security. We will carry on saving though. We will carry on being frugal and savvy until we have paid off this mortgage and are saving up for our next.