Like with most things in life the key word seems to be “balance”, but overpaying your mortgage feels like it should come first, with house maintenance/improvements not far behind. But does that mean travel has to come third?
Those “Go city hopping every weekend!” posts can bemuse people who have financial obligations (let alone families) and know that it’s not quite as simple as that both in time and money terms. Oh and this post is for those people who don’t particularly want to quit their job, travel around the world for a year while renting out their house. Unless you’re lucky enough to take a gap year after being made redundant that is.
Overpaying the mortgage
So overpaying the mortgage? By paying off an extra £250 a month I could reduce my mortgage term by 6 years and save myself a whopping £11k in interest. That would pay for a LOT of travel … but in 14 years’ time! I can’t be waiting that long. So with a “financial hat” on overpaying the mortgage every month is a great thing to do, but that might not be so good for your health/wellbeing/sanity. If you are overpaying though ensure that any overpayment goes to reducing the debt (so shortening the term) rather than reducing your monthly payments as that’s where you’ll make the biggest eventual saving!
Check out this overpayment calculator at Moneysavingexpert but also make sure that paying off your mortgage debt saves more than having the same money in a “very” high earning savings account!
Also there’s house maintenance. In my house I need to have the front brick wall repaired, two fireplace hearths built, skirting boards fixed, a door bricked up and two rooms decorated. Most of these things require a tradesman. Apart from it needing to be done for my own aesthetic satisfaction it would certainly need to be done if I wanted to sell up and move on. So simply put, not all my spare cash can be spent on travel.
Now this is where “balance” comes in. The best thing to do financially is to overpay your mortgage, while making improvements to your house to add value, with the smallest possible outlay to get a good ROI. And then you turn 48 and wonder what you’ve done with the last 20 years. One meme we all like is the one that says “Travel is the only thing you buy that makes you richer”. Kind of true isn’t it?
So yes certainly make sure you pay your mortgage and bills, do essential maintenance, tart up those extra bits when you can (even try some DIY) and overpay the mortgage as a prudent bonus but always try to put some money aside for travel. It doesn’t have to be an escorted 18 day trip to Antartica (£10k), or a luxury week’s break on The Algarve. Travel could be a weekend “staycation” or even visiting something in the county nextdoor. Either way saving elsewhere can be what funds it. Your travel piggy bank can be quickly filled by forgoing your daily work Starbucks (£567 a year!) … or just by asking your boss for a £567 pay rise (after tax), saving the same amount in the space of 5 awkward minutes instead! 🙂