Hi all,
Just looking for some extra input on how my partner and I should manage our finances now we are home owners.
We have a £140,000 mortgage at 4.46% on a 25 year term. We pay £781 a month towards this and seeing that £530 of that is interest is not something I like seeing.
My partner has a personal loan with roughly £2,000 remaining, she pays £100 a month towards this and interest (6ish percent) is calculated monthly and overpayments are possible. Roughly 50/50 interest to paying off the total.
She has no emergency fund after the purchase but is trying to build one up.
I have a 4 month emergency fund for my half of the bills so in reality we have a 2 month one.
We each pay £750 into a joint account and our bills including mortgage tot up to 1337 a month.
I currently earn roughly £30,000 a year including commission (24,500 salary)
She earns £27,000 a year. (She struggles to save and tends to spend every penny by the end of the month)
I have some money tied up in an S&S ISA but I was mainly invested in the American market, I am still in the green but I lost a lot of unrealised gains in the last couple of months so it’s not a time to sell.
Would you prioritise building up an emergency fund some more, paying off her loan, or overpaying the mortgage with the £160 left in our joint?
My idea is to try and get her to pay off her loan as quickly as possible and maybe increase our joint contributions to £800 so we can overpay the mortgage more. Or should we be focusing on getting a 6 – 12 month emergency fund first?
I’m very fortunate that if I did fall on hard times I can ask my parents for help but it really is a last resort as I want to do this adulting thing myself (M26) as does she (F26) as she already feels guilty for not contributing to the deposit despite us having a deed of trust.
Thanks for your input!
Ps no car loans, no credit card debt, personal expenses are our personal cars owned outright and her horse and livery for it, she pays for her dog also and I pay for my two cats. I’ve not figured out exactly what both of our disposable income is. I have a £100 direct debit into my S&S ISA and £100 to a personal saver and the rest of my income I spend. She has no set savings goals ATM. She had a bad experience in a previous relationship to do with finances so I have to tread carefully in these discussions and not tell her how to manage her money, but she has asked me for advice on saving so I’m trying to come up with a plan that she’s happy with.
TLDR:
Prioritise paying off personal loan at 6ish percent, build 6-12 month emergency fund. Overpay mortgage at 4.46%.
Help advising partner on how to manage money after a previous relationship has left a sour taste in trusting me with her financial decisions. (She has asked for help but it’s difficult to fully understand her approach to money and what she spends her disposable income on)
