I have been looking at how much I still owe on my mortgage and how close I am to being able to pay it off. At the moment I am outstanding £94,497.03. I borrowed £100,000 back in 2001 and have put some money in the associated savings account which is why the balance has come down. As it is an interest only mortgage, I have not been paying money off regularly, especially with interest rates so low now, but have been saving money elsewhere.
At the moment I have the money that I have saved up in premium bonds. I have tried putting money in shares in the past and lost quite a bit so that scared me and I did not want to gamble with my mortgage money. Therefore, I have put the money into Premium Bonds, split between two accounts in my and my husbands names. At the moment we have £35,325 in one account and £30,500 in the other. This means that we still have £33,976.24 left to find before we have enough to put by to pay off the mortgage.
We save £750 a month which means that we will have enough to pay the mortgage off in under four years. This is great news, but I am concerned that rates may start to rise sooner than that and that we should try our best to get it paid off more quickly if we can. My husband has been promised a bonus in May and October, which could help, but it depends on whether he decides to treat himself to something instead. I have also got quite a large outstanding water bill (due to them not billing me as I have a leak) and I will need to pay that off once the leak is fixed so that will take a chunk of money. I had saved it up, but as it looks like the leak may not be fixed for a long time (complicated story!) I spent the money I saved on a holiday, knowing that I will be able to pay the bill from money from the Premium Bonds if I do not have it anywhere else.
My short term goals are to get my earning up so that I can contribute more to the income and therefore we can save more towards the mortgage and in the long term hopefully pay it off before rates rise to a significant level.