With a little discipline and help from your love ones, you could save thousands of dollars for your mortgage. Here’s how:-
Assuming you have a mortgage of S$250,000. Your tenure is 30 years at an interest rate of 1.6% to 3% per annum. You make your repayment on a monthly basis.
If you are a heavy smoker who smoke a pack of cigarettes a day, you pay $10 a day or $3650 a year. Each month, an extra $330 could have gone towards your repayment, as a result you could potentially shorten your tenure to 20 years only.
If you are die-hard coffee drinker, by quitting the gourmet coffee and convert to the coffee-shop ones, you save about $8 a day or $2920 per year. You can reduce your tenure by approximately 8 years.
Enjoy your weekly beer drinking session with your buddies? We are not asking you to give it all up. If you spend $80 per week on drinks, then it will be $4160 a year. Your savings will help to reduce your tenure by 10 years or more.
For some of you with the gambling streak in you, time to give it up. If on average you spend $50 a week or $2600 a year. You could your loan tenure by another 5 to 6 years.
Bring your lunch to work 2 days a week, it saves you $12 a week or $832 a year. You save $24,960 and further reduce your interest repayment.
If you add up all these savings together:-
Smoking: $10/day, $3650 a year
Coffee: $8/day, $2920 a year
Drinking: $80/week, $4160 a year
Lottery: $50/week, $2600 a year
Lunch-in: $12/week, $832 a year
Total savings: $14,162 a year
So if you put that extra cash into your loan, you reduce your tenure to 12 years and save yourself about $80,960 of interest. So what are you doing, quit these habits now.