Energy Bills

Investments Vs Inflation.
Check out BP/Shell share price versus last year :exploding_head:
That’s what returns I’m talking about :clap:t3:

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I’ve got 4 years left fixed at 1.24% with approx 70k outstanding. Our monthly cost is just over £400 but I overpay an additional £600 so that come the end of the deal I should be in the final 20k

With the rates going up I’m starting to wonder if I’d be better off diverting this overpay elsewhere and having a lump sum at the end of the deal but everything I’ve looked at currently isn’t a worthwhile difference really. If rates continue to go up this may change.

I’m quite risk averse so don’t really want to invest in say stocks and shares ISA as opposed to paying off mortgage incase it got to the end and was down

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It’s hard to answer really because everyone is at a different point in life.

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This isn’t Blackpool :man_shrugging:t4:
Some of that should probably be in the Fin Whizz thread :clap:t3:

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Stocks and shares are very much a long game. We have some but dont pay much attention to what they will be worth in a couple of years because who knows.

Doesnt seem to be any great offers for cash based savings at the min. We are going to continue to over pay the mortgage, but will have to reduce it down with the stupid energy and fuel prices.

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Good point, well made

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Easy access saver rates are going up and will beat super low mortgage rates.

E.g. 1% mortgage Vs 1.4% premium bond rate Vs 1.71% virgin bank.

Makes sense to pay into a savings account and then lump sum into mortgage.

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Depends on your tax position though. If you’re earning more than the 0% savings rate (or if you don’t have any at all), then you need a substantially higher interest rate than your mortgage to still come out better

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First £1000 of bank interest is tax free. Depends how big a lump sum were talking about.

I think (?) you get £1,000 tax free interest if you’re a lower rate payer and £500 tax free interest if you’re a higher rate payer.
If you pay super tax, you get nada.
I think dividend payments also come into that (although not sure?)

To be getting £500 interest per annum, you’d need about £25k in savings. And hopefully, if you’ve that in cash, it’s in a nice little ISA tax wrapper. :+1:t3:

Also…

…there’s inflation.

Stick £100 in savings at 1.71%, it’ll be £101.71 in a years time. But you’ll need £113.30 to buy the same stuff as £100 got you a year ago.

Stick that £100 on your mortgage, you’ll save the mortgage interest on that, but also reduce your term.

Then again…in saying all of this; it all depends on what you want innit. I get a 55% uplift on my pension contribution. Which, thanks for you energy hungry folks, has done rather well this year.

If I put £100 into my pension, I sacrifice that salary, so save some NI, the NI my employer would’ve paid on that is also added in, plus I don’t pay 40% tax on it, then my employer adds their part.
So for each £100 I whack in, £155 actually goes in.

There is NO WAY I’m getting that return on paying my mortgage down, or savings.

Or am I???

For a £100k mortgage at 3.5% over 25 years, you’re paying £500pcm.
Let’s say it’s an imaginary world and you just fix for 25 years at that rate (where I’m at currently have some 15 year deals at a little under that)

So I’ve paid back £150k to borrow £100k.
Eh? That’s 50%.
You said the rate was 3.5%.
Ah, yes my friend. The joys of compound interest in reverse :disappointed_relieved:

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Correct, although you do get a separate dividend allowance. £2k for all

Frustratingly though, ISA’s do not generally provide the same level of interest return as the best non-ISA accounts. Which is a unfair really. The banks should be agnostic to whatever tax you are or are not paying, but obviously they abuse the fact they know certain people will accept a lower level of interest (benefitting the bank in reduced finance cost) because of the tax they’d otherwise pay.

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165.9p/L in Ashbourne this morning :+1:t3::heart_eyes:

image

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Sounds like a Boomer problem :sweat_smile: I’d need another couple of pandemics to cut back on all the peripheral spending to starting accumulating big time. Really we need to make some small mortgage over-payments again; that would certainly help.

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£4,266 per annum estimate for energy bills from January from Cornwall Insight :exploding_head:

That’s £355pcm combined (for summer, too)

So winter bills will easily be >£500 for us :disappointed_relieved:

Something has to happen here. The price cap isnt a cap if it keeps going up by huge amounts all the time.

Pray for a mild winter, I can see ours topping £450

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The return time on a large battery bank and solar is getting increasingly smaller…

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I bet the price of the hardware is going up though

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Yeah, big companies get richer; nothing like a ‘crisis’ to make some money.

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Yeah - I saw that in the paper on Sunday.
Down from >15 years to <3.5yrs.
But that’s at current/Jan predicted prices.
Likelihood of them staying that high for 3.5yrs is slim.

Primark jumpers are cheap.
I’ve already got my fingerless gloves and fleece lined walking trousers.
Walking socks, slippers.
Etc etc.

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Oodies are on sale right now :wink:

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