Paying extra off my loan

Guru86

Good morning

Had to take out a loan after my car blew up I got 14k at 2.9%. I can afford to overpay £100 each month.

Is it best to pay it straight off the loan or put it in a regular saver at 5% interest then pay it off once the year is up so have interest as well?

Thank you

[Deleted User]

The latter would be more profitable.

[Deleted User]

Where are you getting 5% interest on a savings account ?

Guru86

It's a regular saver with m&s l

macman

Save the £100 per month for a year, or as long as the account allows you to. After the year, pay off £1200 plus the interest earned from your loan.
Rinse and repeat.
Remember, you won't earn £60 (5%) interest in a year, as you are only saving £100 per month.

enthusiasticsaver

I would do the regular saver then repay off the loan at maturity providing you won't be tempted to spend it.

TriggerHappy

Hiya,

If you're planning to over pay then remember to check you're allowed to do it without fees...

Good luck!