lancashire lass wrote:By late 2014 my finances were not good (through no fault of my own) but after arranging a manageable loan, things definitely turned in my favour and although there's still a debt, at least I'm coping better and gradually paying it off (and still £0 on the credit card) Before Christmas the life assurance on my 'interest only' mortgage matured and the shortfall was not as bad as I thought it might be - yesterday I paid off the capital on that mortgage
, and now just have 7 years of the repayment mortgage left. As I'm about 3/4 of the way to paying that off, what is owing is so much smaller ... which means I can really start thinking about trying to pay that (and hopefully the loan too) off earlier. I've been inspired by spudley's "This is the year" thread so my objective in February is to put things into place such as savings or increasing payments on the loan (I won't be penalised for paying off earlier - one of the attractions of that loan) from the money saved from the monthly life assurance/interest payments I no longer have to pay
On Monday I received a letter to say the payments for the capital on the interest only mortgage had been received and been fully paid off

As well as the £15 pm saving, I no longer pay the life assurance which was £38 pm, and the interest I would have paid on the old deal was £54 pm, so that totals £107. Having saying that, I did notice that the new repayment amount was £10 more than when it used to be with a 2 mortgage payment (and interest rates are supposedly better than when I set the old one up 2 years ago, and less capital too ....) I haven't worked that one out yet

My next step is what to do with the £100 a month saving - I'm going to try and live without it otherwise I can see it being squandered without any real benefit from it. My instinct is to put it into a monthly savings plan - perhaps a cash ISA - and start building up my savings again (either to build up a pot to pay off next year's 10% capital or, at some point in the next couple of years I'm going to need a new car) Or, put some of it towards the loan repayments (if I increase my monthly payments to the bank, the amount I owe will be unchanged but I'll pay it off sooner and like the mortgage, won't incur any charges) Hmmm, decisions, decisions LOL I'm leaning towards a 50:50 split between loan and mortgage because paying off both earlier is the real goal I'm aiming for.