What cuts did you make to increase overpayments

moneysavermum_2

I have a £96473 mortgage with nationwide on bmr rate 2.5% my normal payment is £475 but I am currently overpaying up to payment of £700. I have a loan of £189 which is paid in september and one credit card 0% with a balance of £1300.

I know I should probably be paying everything to these debts but feels better for me to do both...overpay and pay off debts. When loan is finished in September I will use that money to clear credit card.

I am trying everything to overpay including reigning in the grabbit spending and cut all the fat out of my budget. I now only pay the usual direct debits:

mortgage,loan,elect,gas,water,council tax, mobile, childcare,life insurance,car insurance, car loan.

I was doing really well overpaying then bought a new car beginning of the year. I am a single parent with 3 children so not huge amount of money spare but I just want to spend it more wisely than in the past and am grateful for anyone elses tips or histories.

gratefulforhelp_2

Eating out/buying coffee out/expensive shampoo and shower gel/fewer car trips/meal planning...not original but they worked for us...we have a way to go, though!

Jonbvn

OP,

You have a relatively low mortgage rate. You would be better off saving instead of overpaying. E.g. LTSB offers 4% gross on their classic vantage up to 7k x 3a/c's.

adwat

I suggest you target the credit card debt first and then focus on the mortgage. You're lucky to have 0% on the card at the moment so make the most of it as obviously this rate will rise massively when your 0% runs out. Your bank loan is not worth repaying early as the interest on this is normally payable in full whether you pay off early or go the full term - but double check with the lender to be sure. Also, make a budget and see what you have spare at the end of the month for debt repayment. Good luck!

originalmiscellany

Target all debt outside of the mortgage, at a higher rate than your interest rate on your mortgage.

It's just little things, but we go to Costco once a month and get as much as we can, and it's amazing how stuff when rationed sensibly lasts - e.g. just because you have bought a 96 pack of crisps, it doesn't mean that you should eat them twice as fast!

Stopping going out to the pub/meal - putting small change in a big piggy bank - any cheques received straight off the mortgage, doing a SOA to highlight what you're currently spending and where you can save even more.

E.g. I saved £15 a month renewing my broadband/phone, so I simply added £15 a month to go off the mortgage, thus no net extra pain, but a little bit off the mortgage every month.

Hope it helps.

pawlala

I didn't make cuts but I used most of my savings to load onto overpaying my mortgage. When I became MF my savings went up faster than before, generating a deposit stash quicker than I could have imagined. And now the cycle begins again!

pavlovs_dog

there is much more fat that we could trim from our budget if we really wanted to go for it with OPing. as things stand, our lifestyle is modest and we are not especially wasteful with what we have. I think the balance between work and play is needed for those of us whose MFW journey will be a marathon rather than a sprint.

my motivation comes from having a target. I would desperately like to have mortgage balance in the region of £105k when our 5 year fix ends in 2015, as it should enable us to take advantage of 60% LTV offers.

I am in the fortunate position (!) of being reasonably new to my career, which means that I will automatically move up the payscale every year for several years to come. We plan that the vast majority of this pay increase will go towards OPing - if we coped without it the year previous, then we should be able to manage just fine this year without too.