Overpay on mortgage or save for next house

[greenleaf5]

We are wondering what to do with any left over money each month. It’s rarely a lot but we think we should save it for our next house purchase.

We have a 10% deposit on our current house and we’re looking to upsize in the next 3-5 years.

Does it make more sense financially to overpay on the mortgage each month or to save that money towards a bigger deposit? Interest rate is currently 2.5%.

It doesn't have to be all of one or the other op? Why not do a mix of overpaying the mortgage and saving?

First priority is to ensure you have at least 6 months of salary saved that is accessible as an emergency fund. Then depending on what you have left you could save some say in premium bonds - Max 50k each - and overpay some of the mortgage. It’s all about balance of having some savings, a chance of increasing your income and paying down the mortgage.