Advice Please...

Hello All,

I've been drawing on the collective wisdom here to overpay over the last few months. I have paid some off each mth, but lapsed recently resulting in a build up of a pot of around 4k in my savings account that I have yet to send over to the mortgage (guess I'd better do that soon).

Anyway, I am on a tracker 0.83% interest expires May 10, outstanding mortgage 144k/18.5 years to go. I will need a new car in a year or two and are therefore saving 200 a month towards this. I already have 2k saved for the car.

My question is this - should I use the 2k to overpay and then use the 200 I was saving for the car each month forward to overpay and then use a 0% c card to buy the car/ or should I carry on saving for the car.

:beer:
cheers

Replies

  • StuartGMCStuartGMC Forumite
    2.2K Posts
    Meno
    Welcome. I would recommend saving for the car, you'll need the cash anyway once you have to pay back the credit card. Also car dealer may well add 2-5% to the price if you use the credit card?

    Good to hear you are budgeting and planning your needs; best wishes.
  • abouttimetooabouttimetoo Forumite
    1.9K Posts
    Hi Meno

    As Stuart says you will need to pay for the car at some point anyway but I was also wondering how much you want to spend on the car and whether you know whether it will be the one year or two that you mention?

    You already have 4k in savings which is going to the mortgage and £2k in car savings, if you do replace the car in two years you will have a total of £6800 won't you as the rate you are currently saving - will you be spending more than that do you think?
    MFW Start Date 1.4.08. Updated 23.1.18. MFW date 1.8.18
    Original Mortgage o/s £187,643 / £71,904 (-115,739)
    Repay o/s £92,661 / now £55,900 (-36,761)
    Int Only o/s £94,982, now £16,004 (-78,978)
    Total daily interest £1 [a) £0.77 b)£0.23
    Total OP's:2018 target £TBC YTD £1,995
  • meno11meno11 Forumite
    3 Posts
    thanks for the advice

    to be honest i am not a car lover. I drive them until they break down completely.

    This one is a Golf 8 years old, 110k on clock. I estimate worst case it has 1-2 years left. However, if it goes on further then I will wait and bank the cash saved instead

    i need a bigger car - but 4-6k and no more is the budget:money:
  • freebiequenniefreebiequennie Forumite
    1.6K Posts
    1,000 Posts Combo Breaker
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    meno11 wrote: »
    Hello All,

    I've been drawing on the collective wisdom here to overpay over the last few months. I have paid some off each mth, but lapsed recently resulting in a build up of a pot of around 4k in my savings account that I have yet to send over to the mortgage (guess I'd better do that soon).

    Anyway, I am on a tracker 0.83% interest expires May 10, outstanding mortgage 144k/18.5 years to go. I will need a new car in a year or two and are therefore saving 200 a month towards this. I already have 2k saved for the car.

    My question is this - should I use the 2k to overpay and then use the 200 I was saving for the car each month forward to overpay and then use a 0% c card to buy the car/ or should I carry on saving for the car.

    :beer:
    cheers


    also beware when buying a car as they only let you pay £500 on credit card then they charge you 2.5% for anything over that as we brought a brand new tigra in mar for £10k and thought ohhh put on 0% cc for 8mths then pay off out savings and also get the cc points for marks and spencer but they only let us pay the £500 deposit on cc then another £500 on day we collected.
  • dimbo61dimbo61 Forumite
    12.4K Posts
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
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    Got my new citroen using cash back cards and paid £6k with 1% cashback but that was 2 years ago!
  • ThrugelmirThrugelmir Forumite
    85.4K Posts
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    Is the after tax rate on your savings better than your tracker mortgage interest rate?

    Whilst your interest rate on your mortgage is very good. In 2010 you may find it hard to match. In fact rates could be considerably higher.

    So you need to consider carefully what you do.
    Real insurance claim quote : -

    "Going to work at 7am this morning I drove out of my drive straight into a bus. The bus was 5 minutes early.".
  • meno11meno11 Forumite
    3 Posts
    I guessed that there might be a problem to buy a car straight on 0% so i thought of getting a purchases card 0%, putting all groceries on it for a year, paying back the minumum.

    Meanwhile bank the cash saved on shopping each week (100 pw). At the end of the year, I have enough for a car in the savings account and a credit card debit that I can move every 6mths until payed off in 3 years.

    I 'rate tarted' my current car on rotating cards for 3 years and never payed a penny in interest.
  • dimbo61dimbo61 Forumite
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    Things are getting more difficult to change credit cards every 12/18 months and many now have a 2.5/3% fee as well.
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