1% challenge 2019

twinklie · 1 January 2019 at 1:04PM

This is a year early for me because I want to clear my debts first. However I’m going to follow for motivation. I love the idea.

Couldsavemore · 1 January 2019 at 3:12PM

Afternoon...

I've made my first OP of the year..

1% is £497

Op made £282.. or ... 0.57%

Oh well its a start!
Fingers crossed that january is a cheaper month!

julicorn · 1 January 2019 at 4:28PM

I think this challenge is a great idea - starting with a more manageable amount like 1% can really show you what difference overpayments can make in the long run!

Just wanted to add that all of you are of course also welcome to join us in the 2019 MFW challenge thread if you like. I know the figures some people there are aiming for are higher than most can afford, but there's also plenty of people aiming for overpayments between £500 and £2k, so you're definitely not alone.

Either way, all the best for 2019!

DD265 · 4 January 2019 at 3:25PM

We haven't got our mortgage yet, hoping to complete at the end of the month, but I've just put 1% of my 1% into a savings pot called 'Mortgage 1%'.

It's only £15 that I've transferred, but this month is gonna be tight. YNAB tells me that if I put £15 a month into the pot, I'll reach my £1500 goal in 99 months - I think I'll try and speed that up a bit.

I do have a question: lets say the mortgage kicks in and we have £100 of over payments set aside already. Are we best paying that off immediately, or doing a lump sum at the end of the 1st year? The interest is calculated daily and applied monthly so I'm guessing we're best making the over payments each time we have the funds available.

Zola. · 4 January 2019 at 4:02PM

1% for us is £1,128. I did my first overpayment in almost a year a few days ago (£1,100).

I have also upped our mortgage repayment each month by £25, so I will have 1% done at the start of February

I will shoot for 2%!

pavlovs_dog · 4 January 2019 at 4:24PM

DD265 wrote: »

lets say the mortgage kicks in and we have £100 of over payments set aside already. Are we best paying that off immediately, or doing a lump sum at the end of the 1st year? The interest is calculated daily and applied monthly so I'm guessing we're best making the over payments each time we have the funds available.

Personally I'd hang on to that £100 for a few weeks as there are always so many unforeseen expenses with a new house. Depending on how much leeway you have in your budget, these can prove difficult to absorb. Do you have an emergency fund? If not I would prioritise that over OPing.

If interested is calculated daily, I'd OP straight away. This means that savings on interest begins straight away and there is no temptation to fritter away spare money. I'm fortunate that our mortgage allows unlimited OPs and I can transfer money electronically so it is quick and easy to do. Not all providers make it that easy to OP, and you may have a cap on the sum you can OP each year. In these scenarios, you may prefer to make lump sum overpayments instead of ad hoc payments.

Moneyfordreams · 4 January 2019 at 9:06PM

£4.99 paid today... I did say I would be slow early in the year

it rounds me down to the nearest Zero

DD265 · 4 January 2019 at 9:08PM

pavlovs_dog wrote: »

Personally I'd hang on to that £100 for a few weeks as there are always so many unforeseen expenses with a new house. Depending on how much leeway you have in your budget, these can prove difficult to absorb. Do you have an emergency fund? If not I would prioritise that over OPing.

If interested is calculated daily, I'd OP straight away. This means that savings on interest begins straight away and there is no temptation to fritter away spare money. I'm fortunate that our mortgage allows unlimited OPs and I can transfer money electronically so it is quick and easy to do. Not all providers make it that easy to OP, and you may have a cap on the sum you can OP each year. In these scenarios, you may prefer to make lump sum overpayments instead of ad hoc payments.

We do have an emergency fund, but I'm not sure whether it'll take a beating and have no idea what our bills are going to come to so like you say it's probably smartest to wait. It won't be a setback in the grand scheme of things though I know that those small amounts will quickly add up once they become regular. We also have some 0% credit cards to pay off and various savings goals, let the balancing act commence!

Our over payments are capped at 10% of the original mortgage capital amount (so £15k) per year. I expect it to be several years before we can consider pushing for 10% in a lump sum, but would still like to do 1% this first year.

pavlovs_dog · 6 January 2019 at 2:29PM

£15.08 paid today (interest on current account balances)

£688.92 to go

Barny1979 · 6 January 2019 at 2:42PM

Soon to be purchasing a property, so joining:
1% of £180,900
= £1,809.

1% challenge 2019

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