Part 290: The FI Trinity

Hello and welcome back to Mortgage Advisor on FIRE.  This week I discuss the FI Trinity. Also, thoughts on overpaying mortgages with some exploration of the different approaches you can take with this.  There’s the usual weekly and financial updates, and more…

How to Start Your Journey to Financial Independence

Financial Independence (FI) is about having the freedom to choose how you spend your time. It might mean retiring early, working part-time, or simply not stressing about money. Whatever your version of FI looks like, the journey begins with a few simple but powerful steps.

First, take the time to understand what FI means to you personally. Not everyone wants to quit work forever. Some people just want more flexibility or the option to work differently. Define your “why” early on, as it will guide the choices you make and help you stay motivated.

Next, get a clear picture of where you are financially. Start by calculating your net worth; that’s everything you own minus everything you owe. Track your spending for a few months so you understand where your money is actually going, or even better, look back over the last few months to get an honest picture.

Your Savings Rate

Once you know your income and expenses, you can calculate your savings rate. If you save £600 from a £3,000 income, your savings rate is 20%. The higher your savings rate, the faster you’ll reach FI, but any positive savings rate is a step in the right direction.

Once you know your numbers, look at your spending. The goal isn’t to become ultra-frugal, but to spend intentionally. Cut things that don’t bring value, like unused subscriptions or overpriced services. Switch to cheaper utility providers, cook at home more, and focus on buying quality second-hand items where it makes sense. Every pound saved is a pound you don’t need to earn again.  Your spending should have a purpose.  It should make a difference, and not simply be wasted on “stuff”.

At the same time, think about increasing your income. This could mean asking for a raise, changing jobs, or starting a side hustle. The more you earn, and the more of it you keep, the quicker you can reach financial independence. Just be mindful of lifestyle inflation; don’t let your spending grow with your income.  If you think about a side hustle, I would suggest avoiding trying to monetise your hobbies.  You’ll probably not make much money, and you’ll start to resent your hobby.

An Emergency Fund

Before you do anything else with your savings, build an emergency fund. Aim for three to six months of essential expenses in a high-interest, easy-access savings account. This gives you breathing room if something unexpected happens.

Next, focus on clearing any high-interest debt. Credit cards and expensive loans are a drag on your financial progress. Prioritise paying these off before investing or overpaying your mortgage. Once high-interest debt is gone, you can start making choices about what to do with your spare cash.

Investing

One powerful option is to invest. In the UK, you can use a Stocks and Shares ISA, where your investments grow tax-free. You might also contribute to a workplace pension or a SIPP, especially if you get employer contributions. Many people choose simple, low-cost index funds that track the market. Investing regularly, even small amounts, adds up significantly over time. It’s far more important to start than to try and get it all absolutely perfect.

Automate as much as possible. Set up automatic transfers to send money into savings and investments shortly after payday. Review your progress every month or quarter. Keep an eye on your spending and make sure your money continues to reflect your values and goals.

As your financial situation improves, calculate your FI number. This is the amount you’d need invested to cover your annual expenses indefinitely. A common rule is to multiply your annual spending by 25. If you need £20,000 a year, that’s a target of £500,000. This is based on the idea that you can safely withdraw 4% of your portfolio each year without running out of money.

Finally, stay curious and engaged. Read blogs, books, and listen to podcasts about financial independence. Join online communities or local meetups. Expect setbacks, celebrate milestones, and remember that the journey to FI is just as important as the destination.

Financial independence is not just for high earners or investment pros. It’s for anyone who wants more freedom and peace of mind. Start small, stay consistent, and you’ll be surprised how quickly things begin to shift in your favour.

Weekly Update

I’ve been very stressed this week for several reasons.  Work has been stressful, but it’s all part of getting used to a new environment, with new processes and policies.  It’s stressful for everyone, and as an autistic person, it feels amplified.  Another source of stress has been, well, stress itself.  

I’m The Asshole

I have a good friend, at least I hope they’re a friend still, who got married on Saturday.  I was asked to be part of the wedding party when this was all arranged a few years back, but my social anxiety pushed back, and I respectfully declined, fully intending to still attend the wedding.

For a few weeks, though, I’ve been feeling increasingly exhausted mentally and physically.  I’ve got a few health issues that are causing me pain and discomfort, and then there’s the mental exhaustion of starting a new job and all that comes with that.  I’ve been feeling for some time that I need a break.

A week ago, I knew that I was not going to be able to make the wedding.  My stress levels were through the roof, and I needed time to decompress.  Socialising in large groups, with noise, music, and all the hustle and bustle, isn’t just uncomfortable for me; it’s almost physically painful.  Some neurotypical people may understand this, but many probably won’t.  That’s not a slight against NT people; it’s just difficult to know exactly what someone else experiences in their mind.  Any attempt at explaining it will always lose something because language is not precise enough.

Anyway, I wanted to be able to go, but I knew there wasn’t a chance I would be in the right frame of mind for it, and all I would do is bring the mood down.  I didn’t want to be a burden to anyone.  I sent my friend a message breaking it down, apologising repeatedly but I haven’t heard anything back after a week.  It would seem I burned that bridge. 

Turning to Reddit…

A couple of days after sending the message and not receiving a reply, I turned to Reddit’s AITA sub, and the responses were mixed, with some people understanding where I was coming from, but other people were less kind.  The final verdict was that I’m an asshole.

I hope the wedding went well, and I wish the newlyweds all the happiness going forward.

On Saturday morning, Oana and I went for a walk around the area and stopped for coffee at a new(ish) place nearby.  I ordered a crayfish bagel and a latte, and Oana had a ham and cheese toastie and a hot chocolate.  The coffee was decent, and the bagel was ok as well, but it was just very spicy. 

I don’t mind spicy food, but this was our breakfast, and I didn’t have the stomach for spicy that early.  The guy who served us came to our table to check if we liked the food, and I explained it was a nice bagel for lunch, but I didn’t realise it was so spicy, and it wasn’t going down well at this time. 

Without any prompting from our side, he said he saw us eyeing the pistachio cake and offered a slice for free, which was incredible service.  I’d go back for coffee and cake, but unless I was ordering something for lunch, I’d probably give the bagel a miss.  The place is May’s Coffee and Tea.

Following our coffee, Oana and I went for a little stroll through Weston Park and popped into the museum to have a look at the Pete McKee gallery. It was nice being out in the sun in a very chilled, laid-back way.

As I’m typing this on Saturday, I’ve decided to back out of a big walk on Sunday in the Peaks.  I just don’t feel up to it, which is a shame, but I really need the rest.  

What I’m Doing

Listening: Careless People by Sarah Wynn-Williams

Watching: The Punisher

The first season of The Punisher is pretty good, but the second season is surprisingly dull.  We’re five episodes in, and it’s just a bit boring so far.  I’m not finding much of the story interesting, and the villain is one of the least menacing characters I’ve seen in a Marvel production.  We’ll finish the show because it’s not that long, and because we wanted to be up to speed before smashing through the new Daredevil series.

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Financial Update

Assets

Premium Bonds: £19,000.00.

Stocks and Shares ISA: £111,669.84.

Fuck It Fund: £4.00.

Pensions: £93,867.27.

Residential Property Value: £239,368.00. 

Total Assets: £463,909.11.

Debts

Residential Mortgage: £179,200.56. 

Total Debts: £179,200.56.

Total Wealth: £284,708.55.

I cashed in £5k of Premium Bonds, which I’ve used to pay a chunk off our mortgage.  Our LTV is now under 75%, so we should be eligible for better interest rates.  I’ve mentioned previously about being on staff rates of interest, as I’m able to keep them for a year after leaving the bank.  This is good.  I’ll tell you what’s not good, though: how awkward it is to find out basic information from Halifax about what rates I can now get.

Halifax

Since I’m on staff rates, I can’t access the same information the general public can about new deals.  Existing non-staff Halifax mortgage customers can sign in to their app and view the available deals.  I can’t do that – it just doesn’t work.  So, if I want to check the deals, I have to call up.

A typical call to Halifax as a customer goes like this… You call up and listen to approximately three minutes of messages about how you can deal with your query online.  Then, you have to say, in your own words, the reason for your call.  I’ll state I want to discuss interest rates for my mortgage, and then I’ll be routed to a completely different, incorrect department.  Normally, they then listen to my question and transfer me to the correct department.

By this point, I’m about 10-15 minutes in.  Then, I have to explain the situation all over again to someone who can give me the information.  Last time I made this call, on Thursday, there was an extra bump in the road, and the call lasted over half an hour.  

Did you know you can do this online?

If there’s one thing guaranteed to wind me up, it’s when I call a business and have to listen to messages about doing shit online.  I don’t want to call companies up.  I hate calling companies, and I hate the annoying music, the annoying menus, and then having to explain my reason for calling to someone who, let’s be real, probably doesn’t care.  

Any business that is going to promote its online offering over employing, training, and paying staff well, had better make sure the online side of things actually works.  

The FI Trinity

I can’t remember exactly where I saw it, but someone mentioned hitting the FI Trinity of £100k in an ISA, pension, and property equity.  It just stood out to me for some reason.  

My progress towards achieving the FI Trinity is going well.  I can already tick the ISA off the list, and the pension should follow in the coming weeks.  My property equity is at £60,167.44.  Assuming a 1.5% increase in property value over the next three reviews of the Halifax index, coupled with clearing roughly £300 off the mortgage debt each month, I should have approximately £76k of property equity by the end of 2025.  

It’s one of those things that doesn’t really matter, but it’s a nice milestone to achieve.

Overpaying Your Mortgage: Strategies, Benefits, and Key Considerations

Becoming mortgage-free early is a powerful financial goal. For many, overpaying on a mortgage can shave years off the repayment term and save thousands in interest. But is it always the right move, and what’s the best way to go about it?

In this section, I’ll break down practical strategies for overpaying your mortgage, the pros and cons, and what to watch out for, especially if you’re in the UK mortgage market.

What Does ‘Overpaying Your Mortgage’ Mean?

Put simply, it’s when you pay more than your required monthly repayment.

• Regular overpayments: e.g. an extra £100/month
• Lump sum overpayments: e.g. a £5,000 bonus or inheritance
• Either reduces the balance, and therefore the interest charged.

Why Overpay? The Key Benefits

1. Pay Off Your Mortgage Sooner

Even small overpayments can shorten your mortgage term by years. That’s more financial freedom and fewer monthly bills.

2. Save on Interest

Mortgage interest is calculated on the outstanding balance. Overpaying reduces that balance, meaning less interest is charged over time.

3. Psychological Wins

Many people find peace of mind knowing they’re clearing debt faster. If you’re on the path to FI, being mortgage-free is a huge milestone.

Key Considerations Before You Overpay

Overpayment Limits

Most lenders allow you to overpay up to 10% of your remaining balance per year without penalty. Anything above that might incur charges.

Check with your lender to understand:

• Annual overpayment allowance
• Fees for exceeding it
• Minimum overpayment amounts

Liquidity: Once It’s Gone, It’s Gone

One of the biggest downsides to overpaying is losing access to that money. Once you’ve made an overpayment, it’s tied up in your mortgage and no longer yours to use.

You’ve essentially handed the lender your money early, and unless you have an offset or flexible mortgage, you can’t just get it back in an emergency.

Before overpaying, ask yourself:

• Do I have enough in savings for an emergency?
• Would I need to access this money in the next 1–3 years?
• Would I be better off keeping it in a high-interest savings account for now?

Overpaying is like prepaying a debt, and while it reduces interest, it also reduces your flexibility.

Please don’t be that person who overpays their mortgage and then shouts at a mortgage advisor months or years later because you can’t get back “your money”. It’s not, and never was, “your money”. A mortgage is a secured debt; it’s something you owe, not something you own. If you pay the debt back early, it’s not a piggy bank you can break in case of emergency.

Overpayment Strategies

Round-Up Method

Round your monthly payment up to the nearest £50 or £100. E.g. if your mortgage is £826/month, pay £900. You barely notice the difference, but it adds up fast.

Annual Lump Sum

Use bonuses, tax rebates, or leftover savings each year to make one larger overpayment. Good for those with variable income.

Fixed Monthly Overpayment

Set a standing order for a specific amount, say £100, £250, etc. Keeps you consistent and removes decision fatigue.

Offset Mortgage Strategy

If you have an offset mortgage, putting savings in the linked account reduces interest charged without committing to an actual overpayment. You can still withdraw if needed.

Should You Overpay or Invest?

There’s no one-size-fits-all.  Unless the mortgage in question has an insanely high rate of interest, the numbers often suggest investing is the better option.  However, this fails to account for the mental comfort that paying off a mortgage brings, especially if you are providing for a family.

For many, a hybrid approach works well: overpay a bit and invest the rest.

Overpaying your mortgage is one of the most underrated personal finance strategies, especially in a world of rising rates and uncertain returns elsewhere. But like all good decisions, it needs to fit your circumstances, your goals, and your comfort with risk.

If you’re unsure, speak to your lender or a mortgage advisor, and remember, every pound you overpay is a step closer to financial freedom.

What’s your mortgage strategy?

Are you overpaying monthly, or do you have other plans for your cash? Let me know in the comments or on my socials.  I’ve now set up a dedicated Instagram page for Mortgage Advisor on FIRE.

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 

You can now find all my social media pages by checking out my Biolink:

bio.link/davidscothern.