What to do with this extra money

[Bestbees]

After some advice/ideas from more knowledgable people!

Now kids are at school we are saving between £600 and £800 a month. We have a mortgage of a bit under 100k with 17 years left to run. We put £50 per kid a month into savings for them and overpay mortgage by 50 a month too.

We are able to have a good standard of living on what we earn (joint around 60k) and have a few things we would like to do around the house maybe up to 8k ish).

I am looking to up my pension contributions (teacher).

At the moment the money is just going into our general savings account. We have around 6k each in individual savings and the same together. Both sets of parents are comfortable and likely there will be reasonable inheritances, but not for a while as all late 50s, early 60s.

Any great ideas/thoughts about what we should be doing? More overpayments? More in savings for kids? Investments?

Thanks!

1. Overpay your mortgage while you have the opportunity

1. Monthly direct debit of £50 into premium bonds - why not?

1. Pay extra into your pensions

1. Give me some of it joking

Thanks Decision. Embarassingly I have no idea about premium bonds so will check them out. Thinking max up my pension. I like the idea of throwing it all at mortgage for example as being mortgage free by 40 (im 32 now) would be epic!

If what they say about the future of state pensions is true, I would open junior SIPPs for your kids, one less thing for them to worry about when they hit adulthood. I imagine £50 each month for each child would be fine.

Overpay your mortgage. We paid ours off a few years ago in our mid 30s and there is nothing better than knowing that the house is ours and can never be taken away.

premium bonds, like all savings, get destroyed by inflation. They are a joke flutter not a serious saving scheme.

keep six months expenses handy, best bet at the moment for easy access is a Tesco saver at 1.3%. (Thanks, Carney). Stuff those pensions as full as you can. The rest needs long term investment which means the stock market. Buy to let on a mortgage doesn't make sense and hasn't for some time.

get shot of the mortgage, unless it's on a very low rate.

Check with your mortgage provider as we can only over pay by 10%per year without incurring costs.

Are you under 40? If so start a lifetime ISA. If you put in 4K a year, the government will put in an extra 1k every year. If you withdraw before you’re 55 you will lose the bonus though. A stocks and shares LISA is a good option if you’re looking for a long term investment.........

I really don’t see the point in putting £50 a month into premium bonds...... the chances of winning are minuscule, especially with that amount.

But I agree with paying off your mortgage as a first option!

Unless your mortgage interest rate is lower than your savings, then pay off as much off the mortgage as you can whilst keeping an emergency fund in savings.

I'd be looking to the future and would pay off the mortgage asap and add quite a bit to your pension. Believe me, once you hit your mid-50s you'll be wanting to get out of teaching and certainly a lot of managers will want to employ younger staff instead.

While interest rates are so low it might be more sensible to look into investing your money they paying it off in a lump sum later down the line.

At the moment mortgages are a relatively 'cheap' way to borrow money

Also forget premium bonds if you aren't filling up isas

Pension
SIPS
Endowments for uni expenses
Mortgage repayments
Fun - memories are valuable and life is short.

Overpay mortgage!

I’d put more in pension
I’d buy private health if you don’t already
I’d increase my savings for the children

Mortgage
Pension
ISA
Kids

And some into an account you can access for emergencies

Pay as much as you can offer your mortgage but keep your monthly payments the same.check how much you can pay per year. Don't worry about the dc they'll be ok because you'll be sorted