What are you doing without to overpay your mortgage?

[coodawoodashooda]

Not a stealth boast. Expecting cms contribution to stop imminently and trying to get rid of as much debt as possible before then. We have enough but it's hard going. Anyone else in the same boat? Please don't be offended. I'm not trying to antagonise anyone. Just looking for moral support.

i’m overpaying to maximise LTV brackets. But I do it at the end of the year after saving monthly so I keep a buffer for unplanned expenses because once it’s in the mortgage it isn’t coming out if you need it for an emergency ( eg a new boiler)

Dont get this, unless you are close to paying off your mortgage and being mortgage free, or you are close to a threshold for better rates, there is really no point in doing this. A mortgage isn't really considered a debt in personal finance terms, and is the "best" debt to have. There is no way I would be eating cheese toasties every night to pay off £50 more a month which is unlikely to be making a blind bit of difference.

We overpay most months because we can. The "sacrifice" is savings, and we are currently reviwing because it would earn is more in savings that we would saving in interest on the mortgage. You might be the same - i.e if you mortgage is 3% and you can earn 4% in an ISA you would be much better off doing that and then at some point (e.g. remortgage) using the savings to offset what you need to borrow.

I sometimes think that overpaying on your mortgage is some kind of financial viture signalling when actually, often, it's not the most sensible to improve your personal economy longer term.

Growing kids need protein and veg, if you can get it into them, across the week.

I don't think we ever cut down on something as essential as food for overpaying, it's more that we were generally fairly frugal when kids were little. Now they are teens they are so much more expensive and it is more difficult to overpay.

So just the usual stuff really - one paid TV subscription at a time rather than several, cheaper meats and meat free days, keeping lunchboxes simple - cheese sandwich, couple of biscuits from a normal packet rather than more heavily packaged snacks, apple, carrot. I think we eat fairly simply in general. Very rarely drink alcohol. Invite friends round for dinner or drinks rather than eating out.

We drive old cars and have cut down on takeaways. We didn't have a family holiday overseas last year, but will be this year. It's all about balance.
We wouldn't be overpaying if we were having to go without food or necessities though.

I have overpaid. Do get a savings buffer before doing so though, I was stuck in a job because I couldn't afford to quit, and have been made redundant so I'll always keep 6 months ready in case.

I'm now over paying with the aim of being mortgage free when the children are 18 so I can help them with university or housing costs. I'm going without doing the house up. I'd love to extend to get a bigger bedroom for my eldest, but looking at extension costs and university costs I'm thinking what is better for the family.

We do caravan holidays rather than abroad, spend less on birthdays etc. DH has a history of poor mental health so I'm not counting on him working til normal retirement age, and one of our DC has additional needs I anticipate we'll have to support her financially or she'll keep living with us.

We never had a proper holiday. I over paid £10 - £20 a month.

Bit of a loaded question isn't it? It presupposes a few things

If you haven't done so already, I really recommend reading the Money Saving Expert article on mortgage overpayments!

I was going to start overpaying when DH started earning more last year but, as we're fixed until next March, we can actually do more with that money by putting it in a savings account with a higher interest rate than our mortgage! Plus those savings are accessible if we do need them for an emergency.

Never overpaid the mortgage. Instead used the extra money to save and then extend the house, covert the garage, renovate the house into a lovely home, go on amazing holidays with the children and save the £40k needed to cover 2 children in university if they do a 4 year course each. I already have one child at uni. Maximum maintenance loan they get is £4.5k their rent in first year was over £6k then they also needed to eat. Hence the parental top up. We also have other savings for anything else.

We fixed our mortgage to cover the period that both children will be in and then out of uni. I would rather have the savings that earn more money in interest than the mortgage rate, be instantly accessible in case of any emergency and then when the mortgage is up for renewal in 2027 we can pay a chunk of it off with no penalties. We have run the numbers through a mortgage overpayment calculator, it doesn't make sense for us to overpay.

We are not going without because life it too short. My friend dropped dead of sepsis aged 39. That was a massive shock. Life to us is for living, not scrimping for a mortgage overpayment. My MIL died within a year of retiring and said that she would have been really pissed if she had not managed to have a whale of a time for 6 months before being diagnosed with leukaemia.

We are now at the tail end of our mortgage so the vast majority of our payment is capital. Our mortgage is a base rate tracker (0.49% above base).

Just before interest rates started climbing we cut down from 2 cars to one and put the money we got for that car against the mortgage.

I am hoping we will have a decent chunk of savings at the end of this year. The question then will be mortgage or pension.

Everyone's situation is different.

Yes I understand that but the OP makes it seem like she actually just can't afford her mortgage once the CMS stops so maybe something else needs to change here.
Also I think there's a balance to be had. Rather than forgoing treats or a roast dinner totally for example which I'm sure they could have even once a month if they actually wanted it. You could scrimp and pay it off then die and you've lived you're live in a stingy way. It just seems so miserable. 🤷

@orangepoang

I think it's about balance a family with small dc will surely want to also go on holidays with them and enjoy their childhood even if it's a short time on "holidays" eg a few nights away rather than a classic week in lanzarotte

I stopped overpayments when interest rates began to rise, we have a low fix and are already under the 60pc LTV bracket. Before that I did a mix of overpayments and investing.

We have just tried to avoid lifestyle creep, so not really going without. For example I have always cut and coloured my own hair. It seems silly to pay to have it done when I've been happy doing it myself for the last 20+ years.

We’ve always overpaid the mortgage so we can retire early. We only have one car & haven’t done much in the way of home improvements. A lot of our friends keep adding to their mortgages to convert the loft, build extensions etc.

We’re frugal with clothes shopping. We do still spend money on good food & holidays though.

So you're letting your house go into disrepair/worn just to retire early even though your house is an asset and you have to live in it every day of your life?!

@Hungrycaterpillarsmummy why are you making stuff up? 🤣
Theres a difference between deciding you don’t need a kitchen island, a quickly no longer on trend feature wall or an orangery, and leaving dry rot to consume your home!

We overpay taking the payment from £600 to £900 a month. As we have children with SEN we have pretty limited options for things like holidays, eating out anyway and are home a lot so it doesn't really mean choosing not to do things (except maybe not being as generous as we could with the heating).

@DancingDaughter50

of course, memories and enjoying childhood with different experiences is important for us. luckily we have family on the coast and family in a large city. we do go on holiday outside of the uk, just not annually. every other year really.

@GemmaSparkles maybe working hard in your teens built your work ethic, drive and resilience, and that’s why you are successful now. I wouldn’t dismiss it as a waste of time.

I don’t think overpaying your mortgage is the best use of funds in this scenario unless your interest rate is astronomical. You are pouring money into an illiquid asset that it sounds like you already are going to struggle to afford. Instead, I would take whatever money you are currently using to overpay and instead put it into a high interest savings account to make sure you have a really healthy cushion when the cms payments stop. These days, savings rates are actually pretty decent (one small silver lining of interest rates shooting up), and are probably higher than whatever interest rate you have on your mortgage.

If CMS stops does that not mean that the child/children are now non dependant so they should be paying keep to replace the loss of CMS. If you need to rely on CMS then surely you need to take keep from them rather than let them enjoy a potentially larger disposable income than you have yourself it also teaches them about budgeting.

Yep! To be honest I have always been loyal to my career progression only, and never worked too hard/too long hours. That also has it’s drawbacks - I rely too much on my wits and intelligence, and don’t have the “10,000 hours” to make me a true expert. Which means that now at nearly 40 I’ve maxed my career potential (not complaining, I reached a “low senior” level).
There must be some golden middle road 🧐