Part 274: Signing the Contract

Hello and welcome back to Mortgage Advisor on FIRE.  This week I discuss huge news from the Scothern household.  Also, thoughts on a recent article about average pension values across the UK.

Weekly Update

I have been offered, and accepted, a job.  Since my redundancy from Lloyds was confirmed in September last year, I’ve received a few job offers but this is the first one that I feel good about.  So, what is the job and how did it come about?

A few months ago I interviewed for a role within mortgages and I had great feedback.  Unfortunately for me, there was another applicant with more experience.  A few weeks ago I was contacted out of the blue by a recruiter who had an opening with the same business.  This was a mortgage and protection advisor position, something I know a little bit about.  

I had the initial chat with the recruiter and gave my consent for my details to be passed to a director at the business, who then reached out to arrange a call with me.  This was a first-stage chat; not an interview, but it’s basically an interview.  We had a really good conversation and seemed to share some of the same values and beliefs about the industry.  So, I was then put forward to stage two.

Stage two…

Stage two was a series of timed tests for things like logic, maths, language, and personality.  I find these sorts of things fairly simple and smashed through them with time to spare.  After a few days I was informed I’d passed the first two stages and was now up for a second interview via video with the initial director I spoke with, and a colleague of his.  It was scheduled for ninety minutes.

The call took place this past week and lasted almost two hours as we got talking about all sorts of things relating to mortgages.  It was a positive conversation, and I was able to be brutally honest about my attitudes towards business, mortgages, work, and customer service.  They liked what I had to say and I left the call feeling 99% confident that an offer would be forthcoming.  The following morning, I was offered the role.

It’s a step up from Lloyds in many ways.  It’s fully remote with the odd day every couple of months requiring attendance in the office for meetings and/or training.  There’s no weekend work and only occasional evening work.  It’s all appointment-based, so no waiting for calls to just randomly come through.  Also, the salary is an almost 20% increase from my time at Lloyds, and that salary was already very decent for what we did.  

All in all, this is a fantastic opportunity and I’m looking forward to getting stuck in.  Ideally, I would have liked to have more time off before starting but they are taking on a few people at the same time and want us all to go through induction together.  As such, I’m starting a week on Monday.  

Oana’s Job Search

Oana is not having a lot of luck finding a job, and I just don’t get it.  She has experience and qualifications and would be a great fit for many companies.  However, she is not even getting many interviews.  We’ve checked and rechecked her CV over and over, and tried a few different formats but it doesn’t seem to be working.  Is the job market that hard to crack at the moment?

I think I found it easier because I’ve had one employer since 2011.  Oana has worked in a few places, but it’s not like a new employer every month.  She’s still plugging away and hopefully, something will come about soon.

Getting Fit

To get fit, and because my elbow is still painful AF, I’ve bought a treadmill for home.  It’s very good so far; quiet, with a digital display, and it folds up against the wall.  I can even bring down the bar across the front to use it whilst standing at a desk.  I don’t think I’ll be doing that as I don’t have a sit/stand desk at home.  Still, if I can just jump on it for half an hour here or there it should help get the steps in each day.

I need to sort something out with my elbow as it’s getting worse by the week.  It feels like someone is shoving a hot poker through the back of the elbow at the bottom of the tricep.  The pain also radiates all through, and around, the elbow joint.  Carrying or lifting a heavy mug, kettle, or bag is painful.  I’ve been dealing with this for over two years now and I’m sick of it.  I refuse to believe that this pain has no cause and there has to be some way of identifying it.  So far, I’ve been met with a collective shrug by three different consultants.  

What I’m Doing

Listening: Truth of the Divine by Lindsay Ellis.

Watching: The Killing Vote (Netflix).

I’m enjoying my current audiobook, Truth of the Divine, but I’m finding it hard to make time to listen to books lately.  A lot of thought has been put into the history and structure of the alien civilisation, and I find that refreshing.  Their way of life feels alien, rather than just a mirror of human society.

We’ve started and abandoned a new show on Netflix called The Killing Vote.  It’s just not grabbed our attention despite an interesting premise.  Someone hacks the national phone system and sends out a vote asking whether a criminal should be killed or not.  Everyone has the chance to vote yes or no.  We normally enjoy Korean shows but this one just hasn’t done it for us.

In the past week or so we’ve also watched a few good movies; Civil War and Sputnik were enjoyable, and Carry On started well but quickly became ridiculous.  

Civil War tells the story of a group of journalists travelling through war-torn America in a dystopian near future in which there’s a civil war ongoing.  The war is not the focus of the film; it’s about the experiences of the characters.  It doesn’t spoon-feed you the answers and leaves a few questions open.  I enjoyed it, even if it sometimes felt like it didn’t know what it wanted to be.  

Sputnik is a Russian film about cosmonauts who bring back an alien life form in the early 1980s.  It’s a sci-fi horror film and is pretty gross in parts.  I enjoyed it, as it was a refreshing change from the Western way of telling this story.

Cats and Catteries

Sweep

Regular readers will know that Oana and I have had cats for many years.  We adopt old cats who are looking for a forever home, as they tend to be overlooked.  Our first cat, Sweep, was my best friend in the whole world.  He was so affectionate and we just bonded.  I had a routine with him when I’d finish work, where I’d go and crash on the bed and he would run over and jump on me, resting on my chest and rubbing his head against mine.  He’d settle down and start purring and we’d stay like that for a while.  It would help me decompress after stressful days at work.  When he passed, it was like a part of me was ripped away.  His health was failing and after several visits to the vet, it was decided to let him go in peace.  We held him, stroked him, and spoke to him as his eyes closed.   

Bobby

A few months later, we adopted Bobby who was very nervous.  It took him months to fully settle.  We suspect he had been mistreated in the past but slowly he came out of his shell.  He was a really sweet little guy, who had a lot of love to give.  He had finally found a home where he felt safe, and he would come and spend time with us.  One of our last memories with him was just before Christmas watching a documentary about cats.  He sat with us and was fascinated; he didn’t look away once during the whole show.  On Boxing Day in 2021, he was sat on the sofa with Oana, and I was in another room.  He had a seizure of some sort.  I came running through and saw him take his final breath.  

Both these losses within a year were heartbreaking.  We took some time before adopting Poppy, and we’ve had her since March 2022.  We’ve loved all our cats in different ways, and one of the most difficult things to do is to leave them in a cattery.  It’s unavoidable that the need arises from time to time, although we do try to minimise how often it happens.  We’ve always used a specific cattery that my Mom used for her cat for almost twenty years.  However, the owner is slowly winding up the business. 

Finding a new cattery…

Trying to find a new cattery that we feel comfortable with has been causing a lot of stress.  One time, when our regular one was fully booked, we had to use a different one and although it was in a lovely setting, the owner didn’t seem to give a shit.  I don’t think he mistreated the cats in his care, but I don’t think he had the same level of affection that many other people who work in catteries tend to have.

As we have a holiday coming up later this year we had to do some research on a new place.  We found one out on the outskirts of Sheffield and made an appointment to go and view it.  The owner was great and she loves cats.  We were able to meet some of the guests staying in her establishment including a couple of massive Maine Coons.  We felt really good about the place and we’ve got Pops booked in for later this year.

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Financial Update

Assets

Premium Bonds: £30,000.00.

Stocks and Shares ISA: £92,159.23.

Fuck It Fund: £13,052.13.

Pensions: £94,077.16.

Residential Property Value: £237,228.00. 

Total Assets: £466,516.52.

Debts

Residential Mortgage: £184,492.19. 

Total Debts: £184,492.19.

Total Wealth: £282,024.33.

New Milestones

I hit two new milestones this week with my pension and total wealth values achieving new all-time highs.  The next milestones are to hit £100k in pension and ISA accounts, and to get my total wealth over £300,000.  It’s all psychological, in that there’s not some huge boost when your wealth ticks over from £299,999 to £300,000.  It’s just always nice when that first digit goes up.  

Average Pensions

A good friend shared an article with me this week that I found very interesting.  It was about the average size of pension pots across the UK and provided data from several sources.

According to the ONS, the average pension pot in the age bracket myself and Oana fall into (35-44) is £30,600.  I’m fortunate enough to have over three times that much, and Oana is almost £10k over that value as well.  

The report also details findings from a study by Fidelity, but their age brackets were much broader.  Interestingly, Fidelity breaks down the data by age and gender which highlights a significant imbalance between what men and women have saved.  In the 35-54 age bracket men have an average of £80,300, and women £46,800.

It’s wrong that there’s such a discrepancy and I was trying to think of why it could be.  First of all, there’s the gender pay gap.  I think a huge factor is when women take maternity leave.  If a woman takes a year off and has say, six months at full pay and then six months at half pay, and for those last six months they may only be paying in half of what they normally would to their pension.  If they subsequently return to work on reduced hours due to childcare commitments, their pension contributions will drop proportionally.  These might seem like small differences on a month-to-month basis, but compounding can be brutal over the long term.  

What is the answer?

Well, I’m not interested in having kids and neither is Oana.  That doesn’t mean I’m ignorant of the need for our species to have children, not only for the continuation of our species but also to keep society running.  Children are an investment in our future, and I think that should be reflected in pension contributions.  Perhaps a benefit of sorts, whereby mothers are paid a bonus into their pension when they are off work due to maternity leave.  This would be a set amount as a one-off sum, and would not be means-tested.

I’ve not given this idea a huge amount of thought, but that initial outlay could save much more in the long run as women retiring would have a greater level of income than if the bonus had not been paid.  

Pensions don’t seem interesting…

It was the same when I was younger, but those starting in employment don’t tend to see the point in paying into a pension.  The earlier you start taking control of your financial future, the better it will be.  So many people waste a good decade of their working life before really paying attention to it.  

If you are working for a company that offers a generous pension matching benefit and you don’t take advantage, you are throwing money away.  For example, assuming you are with an employer for 10 years, and for the sake of simplicity I’ll assume you earn a standard £30,000p/a.  If you pay 3% into a pension, and your employer pays 5% (the minimum required amount) you will have a total of £200pm going into your pension.  After ten years with an assumed growth rate of 7%, you will have a pot of £34,616.

However, if your employer matches an increase in your contributions so that if you put in 5%, they put in 7% for a total of 12%, you would be paying £300pm.  This means after ten years with that 7% rate of growth you would have £51,925.

It’s important to understand that in these examples I’m not talking about your salary being reduced by £200 or £300pm.  Those amounts include what the employer pays on your behalf.  You are only paying part of it.  However, if you increase your contributions, these amounts are taken from your salary before it’s taxed.  So, paying an extra £100pm towards your workplace pension will not reduce your wage by £100pm; it will drop by less than that because of the associated reduction in tax you pay.

ISA Transfer

My ISA transfer is finally going somewhere.  Part of my balance has been transferred over but a part of it is still with the old company.  I’m not sure what the difficulty is moving the funds across but I’m hoping it will be completed by next week.  

It’s going to be a nice change not paying over £30pm in fees for my account, and the £5 fee for making a trade with the new provider is nothing to worry about seeing as though I’ll only be making 1-2 trades per year. 

Student Loan

I have two student loans which just sit in the background and I don’t include them in any working out for assets and debts because they’re almost like a tax.  I always account for them when working out what my net income will be, but for this FI project, it seems irrelevant most of the time.

For the last few years, I’ve been chipping away at my two loans steadily.  I’ve got a Plan 1 loan from my time as an undergraduate, and a post-graduate loan (PGL) from when I studied my MSc.  I owe approximately £3,700 on the latter, but on my new salary (assuming I start this new role as I’m trying hard not to count my chickens) it will take a hefty chunk of my monthly pay.  The interest rate on the PGL is 7.2%.  

On my new salary, it would be repaid in a couple of years, but I’m thinking I might use some of my cash savings to just clear it early, so I’ve got the extra income. My cash savings are not earning 7.2% in interest – it’s more like half that.  So it seems like an obvious decision, but all this assumes that none of the variables change significantly in the next few years.

Overall, it’s a relatively minor issue and not worth stressing over, but it’s still an interesting problem to work out.

That’s all for this week.  Thanks for reading, and I hope you have a great week ahead.

DISCLAIMER

The views and opinions in this blog are my own, and do not represent the views or opinions of my former, current, or future employers, nor should they be considered advice.

If you want personalised financial advice, seek an appropriate professional.  If you are in financial difficulty, seek advice via the resources below:

StepChange

MoneyHelper

Biolink 

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