Overpaying your mortgage

Enables’s IFA’s in Bishop’s Stotford and Saffron Walden know that the first few months in a new house can sometimes be a bit of a financial struggle as you add to the costs of moving, the new mortgage repayments and household bills. But once you’ve settled into your new home and factored in your new outgoings, you may find that you have a bit more disposable cash than you thought you would have.

It might be very tempting to book a holiday, treat yourself to a new car, or spend in some other way but perhaps it really would be better to save or invest that money for the future. One fairly straight forward way to save is to overpay your mortgage, if you can. If you overpay your mortgage you will be paying less interest overall and gaining more capital. By paying as little as £100 extra a month, you could significantly reduce the term of your mortgage. For example, if you have a £100,000 mortgage over 25 years with an interest rate of 4%, and you pay off an extra £100 a month, you could reduce your mortgage term by 6 years and save £15,534 on interest.

It is important to be aware that not all mortgages are the same, some may charge an early repayment fee, so it’s worth sitting down before you take out a mortgage or when you are reviewing your mortgage to talk through whether an overpayment charge would outweigh the other benefits.  It is also worth finding out if you can build in some flexible overpayments before you take out a mortgage so you can overpay when you can afford to and not when you can’t.

https://www.mortgageadvicebureau.com/news/TheInsandOutsofOverpayments/1241

Your home could be at risk if you do not keep up the mortgage repayments


Issued by: Enable Independent Financial Life Planners • 
25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE

Are the young just bad at saving?

Enable’s IFA’s in Bishops Stortford where interest to see recently that “All age groups, including younger people, are saving more than they used to,” according to a comparison of 2004 and 2010 figures by the Grattan Institute.

There tends to be a lot of criticism of Generation Y for spending on luxury items, be it avocado on toast for breakfast, lattes, iPhones or another festival or weekend city breaks. The logic would seem simple, spend less on luxuries and save more of you hard earned cash. But the figures actually suggest millennials are saving more than they used to and are simply faced with increasingly difficult-to-afford house deposits.

As an indicator of housing affordability, the house price-to-income ratio, and the “deposit gap”, both remain much higher than they have been for the past few decades. The study also shows that younger people are now spending a greater proportion of their income on housing rather than other household expenditure categories, such as food, alcohol, or recreation. Interestingly, the same survey of spending habits found that younger people (defined as younger than 35) saved more per week than older people, even when comparing families with children. This may however be due to younger people living at home for longer but it still indicates Millennials have no issues with saving money.

You are never too young or too old to start saving and Enable’s IFAs in Bishops Stortford can help you make a plan for investing your hard earned savings.

Source: https://www.theguardian.com/news/datablog/2016/oct/18/are-millennials-actually-bad-at-saving-or-are-houses-just-unaffordable


Issued by: Enable Independent Financial Life Planners • 
25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE