It's the final countdown...£10k to go

t2rry

That work on the house I mentioned that was delayed?  Not so delayed after all.

So whilst with standard payments and some selling of stuff lying around, I've got the savings pot up to £4,135, which is fantastic, I'll now need to use some of it to pay for that work being done on the house.  I do have some additional house-specific savings that I will use up first, but it won't be enough so I'll have to steal from Peter to pay Paul (to the tune of £2,500)

Still, nice to have various pots to steal from and it means I can save more moving forward because I was otherwise going to start a sinking fund for this work, so it will mean the same result come the end of the year, just in a different order.  I have the bug again for stashing extra cash away so I'm on the hunt for more things to sell so hopefully this little speedy saving start to the year will give me the push to get it back up to this level as quickly as possible.

In negative news, I've just had our second-in-a-row energy bill over £500 for the month.  I'm really hoping weather improving now will start to see that tumble in the downward direction because it's honestly heartbreaking.  To think a few years ago if I had to pay £200-£300 to cover the entire winter period I'd be beside myself, and somehow we're just expected to take this on the chin.  

If I could literally get on my knees and beg someone to not let this become the 'norm' I would do, I'm really fearful that's what will happen and it entirely changes our financial stability.  Always mindful that we are one of the lucky lot who can physically pay it, too.  

mark55man

I agree about the heating.  How can it be the norm when wholesale prices have tumbled.  Personally I think favours are being cashed in, and the dreadful state of the energy markets is being hidden from us!!

Agree about nice to have pots to juggle with.  I'm not sure how I would have coped a few years ago.  The pandemic was a financial boon to me in terms of changing spending vs savings!

t2rry

so there it is, saved balance down from £4,135 to £2,150.  But that's some big work done, so it is what it is.  

It will go up again during march with automatic savings to the tune of £1,040 so back up to £3,190 even if I can't add anything else to it prior to the end of March.  

t2rry

My student loan is now at 4.5% interest.  I have £3,000 left to pay, which by PAYE contributions will take 15 months to clear.

I have been back and forth about paying this off for years, but always fallen down on the MSE side of considering it a tax rather than a real debt, especially whilst the interest rate was so low.  But now I'm trying to maximise savings and having those savings doing something, namely:

We pay £500pcm to a S&S ISA
We pay £150pcm (the max) into a regular saver at 6%
We pay £300pcm (the max) into a regular saver at 7%
We pay £100pcm (will increase to £200) into a regular saver at 5%
We have £10k fixed savings at 4.11% (ends October 2023)

We have our £10k emergency fund sitting in premium bonds.  We've made 2% on that over the course of the last year, I am pretty sure I want to move it to guaranteed interest but given it's an emergency fund we should keep it accessible, best rate I can find for that at the moment is 3.15%

So whilst we have a lot beating the student loan 4.5%, we have a lot that isn't.  We could open a second regular saver at the 6% rate, but that's a maximum £150pcm, and I'm not sure if drip feeding into there from the emergency fund beats £3k sitting at 4.5% for the same time.  

If I pay off the student loan from the emergency fund, I will have £7k left and I can either use the additional monthly income (circa £200pcm) to get that back up to £10k, or I can drip it into that additional 6% regular saver.  Some of the regular savers will role on until they are full to the maximum amount allowed, others will mature after a year so become available funds again throughout the course of the year (all at different times).  

I think I am finally persuading myself into paying it off from a financial perspective rather than from (what I have considered previously) a psychological one of wishing to be entirely debt free.  I've always decided the psychological perspective isn't the one to guide me on this but am I right that it's now financial savvier to pay it off?  

The *only* thing that I think stops me is the thought that it would have been wrong *if* something were to happen to me tomorrow that meant I would have never otherwise paid it off, but the odds are surely (touch wood) against that....!??!?!?!?

t2rry

I've just shared that post in a new thread because I want to discuss it, make a decision and draw a line under it either way so I can stop overthinking about it!!!

mark55man

Interesting.  Maybe you could share the link to that thread - save us all from looking in the wrong place 

t2rry

good point!!

Student Loan up to 4.5% - Is it now time to pay it off? — MoneySavingExpert Forum

Tara66

Hi I would pay it off as you are guaranteeing a 4.5% 'return' versus whatever you are getting in your premium bonds whilst you decide the future place for your premium bonds money. I also like things simple. 

You have put yourself in a great position by the way, and the right or wrong of it is probably quite marginal whatever you decide. X

t2rry

right, thanks both, I've paid it off!

so that's £212 back in my salary take home every month, which feels quite nice!  Not to mention a negative line in my financial summary spreadsheet gone,

So I've decided that's my third goal for the year, to save back the amount I've paid out.

Third line added to my signature, just need to work out where I start saving it!

t2rry

I have re-jigged my signature so it lines up with my accounts.

I used £3037 to pay off my student loan, not £5k, but I've put £5k into a fixed savings account at 4.3% and the rest has been split between:

1. The savings recorded at item 2 on my signature, so this has had a boost meaning for the rest of the year, I just need to find £490 to add to this and the rest will be covered by our automated savings every month.  That's to have it achieved with November's salaries.

2. The house fund.  We are so close to another room complete, it just needs those final bits and pieces and the house fund was emptied (for the first time) with last month's bigger work so I've put the remainder in here to keep us moving forwards and to build on again from next payday.

So it's easier to keep track if I just say I've reduced the Emergency Fund to £5k and need to replenish the other £5k, I just need to work out where to save it, I feel like I have savings accounts coming out of my ears at this point!