Page last updated at 09:57 GMT, Monday, 19 January 2009

Squeeze panel: Barrie Lester

Barrie Lester and his partner Natalie
Age:27
Job: Electronics engineer
Income: £27,000 per annum
Recently bought his first home with a 100% mortgage
Barrie Lester is 27 and an electronics engineer from Bournemouth in Dorset.

He lives with his partner Natalie and they recently bought their first home with a 100% mortgage.

They are always experimenting on new ways to save on food and entertainment. He is following the financial crisis closely and is now happy that interest rates come down.

DECEMBER

After the panic I went through last month over the prospect of my mortgage payments drastically increasing when my fixed rate deal ends in February, I was relieved to find that the interest rates on my mortgage are set to reduce below the current rate.

If I fail to meet my mortgage payments, my lender has said they'll wait six months before they kick me out of the door. This, I guess, is their way of giving me some peace of mind.


We've had to cut down slightly on the amount we're spending on Christmas presents this year, but we've tried to make up for it by putting a lot more thought into each gift.

I have also learned that the government is considering paying the interest on mortgage payments to those who are made redundant. I consider this as free insurance from the government, should the worse happen.

Natalie and I have made some big lifestyle adjustments to accommodate the increased costs over the year.

This has come in the form of attempting to entertain ourselves at home, (hurray for Saturday night TV) rather than our old past time of weekend pubbing and clubbing.

We have become accustomed to staying in more, so we have the time and energy to decorate our flat. However, there has been the additional cost of DIY materials to do this. On the plus side, due to staying in, we have managed to scrape together some extra cash for Christmas.

We've had to cut down slightly on the amount we're spending on Christmas presents this year, but we've tried to make up for it by putting a lot more thought into each gift.

For me, Christmas is always a lovely time of year but I appreciate that for some families, in the current climate, it must be another financial nightmare.

The pressure to make it special on a budget and provide the latest toys for your little 'uns must create stress and worry for some. I mean, how do you tell your kids that Santa won't be bringing much this Christmas, even if they've been on the nice list all year round?

I'm feeling more optimistic for next year, but then I'm an optimistic person anyway. I'm hoping that the reduction in our mortgage payments will be enough to cover the increased cost of living.

I'm confident that the economy will improve next year. It can't get much worse, can it?

NOVEMBER


Why is my, now state owned mortgage lender not passing on the benefits of the new interest rate cuts?

I have to be honest I haven't been giving the credit crunch the respect that it deserves.

I know food, petrol and utility prices have been going up, and some have peaked, but it was only recently that I felt I might not be able to cope.

I have adopted the spirit of saving money. However, I've always considered my need to save to be because of my new financial commitments (my mortgage) rather than the credit crunch beating down my door.

Saving money is a good thing to do at anytime not just in a financial crisis, I tell myself.

Trouble is, my mortgage lender sent me a letter which highlighted my ignorance towards the credit crunch, and gave me a rude awakening.

How dare they! I know I represent a statistic within the toxic sub-prime mortgage market but I consider myself to be an exemplary borrower.

I always pay the mortgage in full and on time and I have no reason why this wouldn't continue, gold star for me!

INFLATION CALCULATOR
This month's personal inflation: 2.8%

So why is my mortgage lender only offering me a standard variable rate at 7.6% when my fixed rate mortgage ends next February?

Have I not proved that I am a lower risk borrower? This new interest rate will cause a significant increase to my monthly payments.

The government are asking mortgage lenders to help out borrowers where they can. So why is my mortgage lender not passing on the benefits of the new interest rate cuts?

I'm no expert but I think these actions are completely unhelpful. What hurts the most is why my interest rates are potentially going up..... My mortgage lender either wants me off the books because I have a 100% mortgage, or they're determined to get their money's worth out of me until I'm finally in a position to change lenders.

It's a sobering thought that in business cash is king, and people's lives and emotions are not accounted for.

You know last month when I talked about eating liver to save money? Well, it's back on the menu next February.

Damn you credit crunch!!!

OCTOBER

We've tried experimenting with different foods and to keep eating meat cheaply we have tried cooking liver. At about £1 for over half a kilo of meat it was worth a try. It's a shame we both thought it tasted disgusting.

I have been following the current financial crisis very closely on the BBC website. Finding out how we all got into this mess astounds me. I remain optimistic that the recent interest rate cuts will continue throughout the year and into the next. That would be great, because our fixed rate mortgage ends in February next year and hopefully we will be able to get a lower interest rate than we are currently on.

It's good to see Tesco appreciating consumers' struggle with the rising fuel costs. We've been happy with the occasional voucher offering 5p off every litre of petrol we buy in a one transaction.

Natalie and I have been inspired by celebrity chefs at the moment. We've tried experimenting with different foods and to keep eating meat cheaply we have tried cooking liver. At about £1 for over half a kilo of meat it was worth a try. It's a shame we both thought it tasted disgusting.

INFLATION CALCULATOR
This month's personal inflation: 4.5%

We have recently purchased an oil filled radiator to substitute the convection heaters that we have in our flat. I'm think it will turn out cheaper but at the moment I'm not sure how much.

I believe that the artificial reef in Bournemouth is nearly completed so the ideal scenario: reef attracts thousands of surfers, surfers buy property and the price of our flat reaches a record high.

It's good to have a dream.

SEPTEMBER

Barry Lester says rising fuel costs are a serious concern

I purchased a smaller car this month to help reduce my fuel costs. Luckily, I brought it in time to avoid paying tax on my old car. Scrap metal remains valuable, so I did get a great price on my old car for scrap, which was very helpful.

Natalie and I continue to shop around to find the best deals on groceries and we've also been trying some vegetarian recipes to keep the costs down. The price of meat is getting ridiculous, we've decided to become 'mid-week veggies' for a while.

Now that summer is fading and autumn has almost arrived, we've been trying some warming vegetable soups, which means we can make big batches for next to nothing.

In anticipation of autumn, we've also been researching the most efficient way to heat our home this winter.

INFLATION CALCULATOR
This month's personal inflation: 4.5%

Our flat does not have a gas supply and we have simple convection heaters to heat our flat up. This proved to be very expensive last year, so we hope to find a cheaper solution before the colder climate ensues.

Both Natalie and I are looking forward to the £60 tax rebate we should be getting at the end of the month. I think we'll be treating ourselves to new clothes rather than saving it, I think that's what Gordon Brown would want us to do, bless him!

AUGUST

WEEKLY STAPLE FOOD BILLS
Milk - 8 pints skimmed. £3
Bread. £1.44
8 Bananas £1.45
6 Yogurts £3.24
Chicken breasts - 1kg £2.99
12 eggs at £2.54
In a bid to save money on our food shopping bills this month, we've visited various supermarkets to take advantage of offers and low prices. We find Tesco provides the best buy-one-get-one-free offers, Lidl is good for half-priced bargains on vegetables and is also great value for meat, and Asda is generally cheaper overall.

This does of course take us extra time to get all of our food and drink and is just extra hassle that we don't need at the weekend - especially when we work full time. But what can you do!

I am still searching for a more economical car and am counting down now as the tax on my current car runs out this month. I really do not want to pay for another 6 months tax for a 2.5 litre car and so I only have 4 weeks to get this sorted.

Natalie has decided to now give up her gym membership in favour of exercising outside. Although she loved the social aspect of the gym, she is now saving £43 a month by stopping her membership.

JULY

Natalie and I bought our first home in November 2007 with a 100% mortgage.

At the beginning of this term we opened a joint account and we agreed that we should always try and have at least £1000 'safety net'.

We collectively put £1500 into the joint account per month and subtracting the bills (approx £1150 per month), we're left with £350 for food per month and any other items.

Food of course is becoming increasingly expensive and due to us redecorating our new home and unexpected charges (new carpet in block of flats) we have slowly 'eaten' into our £1000 'safety net', which no longer exists.

I have recently changed jobs and my commute is now further which explains my large petrol bill per month. I'm looking to buy a smaller car in the coming months with the aim to reduce my petrol bill in half.

Eating out, holidays etc might be a thing of the past over the next few years in order to save money.



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