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If you are finding it hard to save as much as you’d like you might want to consider taking out an offset loan to help you save more every month while at the same time reducing your mortgage.

It has been hard to save during this economic slump – we might be out of the recession, but according to National Savings & Investments, the British public is now setting aside just 6.25% of their wages – the lowest level since summer 2007. In pounds, average savings have fallen from £90.12 twelve months ago to £81.94.

Only 44% of people say they have been regularly saving any money over the last few months. Over the past five years, this figure has fluctuated between 47% and 55%, so this is one of the lowest ever recorded levels. Also, the amount of money ‘regular’ savers set aside each month has fallen below £200 for the first time in over a year to £195.08.

It’s hard to save when there is little chance of bonuses or raises. But with an offset as you save, you reduce your outgoings for the next month because your mortgage rate has been reduced. So with an offset you can be sure that you will be able to save even more next month even without the promise of more money from your job.

Tim Mack at NS&I says: “With the new financial year approaching, now is a good time for people to take a closer look at their finances and set themselves savings goals for the year ahead.”

SOURCE: NS&I, 03/03/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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More young adults are struggling to get jobs and make ends meet, so they are having to rely on their parents more than ever for support. This can be a real burden on parents – but it needn’t be with an offset mortgage.

According to research from Scottish Widows, adult children are continuing to ‘sap’ their parents’ savings and investments and while the average amount being handed out has increased significantly, the number of parents able to give has fallen. 

Almost half of parents with children over 16 have given or loaned money to their adult children or grandchildren – the average amount given to struggling kids is £13,660, up from £11,800 last year, proof that those parents who are able to give are being forced to give more as their children struggle.

The immediate effect the saving sap fund has had on parents is also alarming – 82% of parents who gave money to family members had to dip into their savings to do so, and worryingly 54% of these do not think they will be able to top that back up.

Iain McGowan, savings expert at Scottish Widows says: “Fewer parents can afford to give or loan money, while those who can, are being asked to provide more. Parents will not only be extremely vulnerable to any unforeseeable circumstances, but the extra handouts to their kids can also affect them in retirement, meaning they may have to work longer, or make their retirement savings stretch further. The earlier parents and children get into the habit of saving the better.”

If you have an offset mortgage, you can take out the lump sum saved against it whenever you need it. It won’t make you more indebted but it will only increase your mortgage rate by a small amount each month. But crucially you will be able to help your kids and keep yourself safe at the same time.

SOURCE: Scottish Widows, 03/03/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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Most people have to get serious about saving money at some point – do it sooner rather than later with an offset mortgage.

Saving money each month allows you to build up a nest egg, gives you a better credit score and gives you a better chance of getting hold of better credit in the future – so the sooner you can begin saving the sooner you can become a better borrower.

It seems as though some people are realising this – the average age for Britons to start saving seriously is 25 years-old, according to new data from National Savings and Investments.

But there are still some people who are simply not able or not willing to save money – more than a fifth of the population say they didn’t start setting money aside in earnest until they were past their 30th birthday, while more than one in ten fail to seriously save until they are 40 years or older. Worryingly, 15% confessed that they had actually never saved at all.

But people are waking up to the benefits of saving thanks to the recent financial crisis. NS&I says one of the main reasons people get serious about saving is after reading stories about how others, without savings, have suffered in an emergency and a third confessed that it was when they suffered a financial shock personally that they began their savings habit. Others began after seeing their parents worrying about not having enough money now and in the future.

It doesn’t matter why you decide to start saving, the important thing is how you do it and how serious you are about putting money aside each month. By using an offset, you are incentivised to save with a reduced mortgage payment each month – so the more you save, the less you pay.

NS&I says: “We’re urging Britons to review their future financial needs and to develop the habit of saving.”

SOURCE: NS&I, 24/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog

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New research by The Co-operative Bank Mortgages has revealed that almost two thirds of mortgage holders are aiming to be mortgage-free by the time they reach 50 years of age. 

This is a great goal, but one that is tough to make a reality. To do it you need a mortgage that encourages overpayment and actually gets cheaper the more you invest into it – you need an offset mortgage.

To be mortgage-free would be a wonderful thing – the bank found that over half of people would take more holidays, just under a third of people would turn their attention to saving more for retirement and a quarter of people would look to change their working lives by either finishing work or moving to part time hours.

And people are doing it already. Many have been making mortgage overpayments to reduce the term of the mortgage over the last year. Other people are looking to take advantage of the low interest rate environment, and some are looking to have more disposable income as a result of reductions in their mortgage rate. Ask your mortgage adviser about how well their offset mortgage clients are doing right now for an idea of the benefits overpayment can make to your life.

James Hillon, head of mortgages at The Co-operative Bank says: “The research clearly shows that many mortgage holders are looking to take advantage of the low interest rate environment by making overpayments.”

With an offset mortgage, because you can make overpayments and because you can reduce your rate by doing so, it pays to be in a low rate environment and it pays to overpay. It’s exponential as well, because the more you save the cheaper your mortgage rate and the more you have in your pocket at the end of the month, so you have the means to save even more the next month, and the next.

Talk to an offset mortgage adviser about a loan that will help you become mortgage-free. It might seem like a long way off when you are trying to manage a six-figure debt, but with hard work and good advice you can get rid of that responsibility and begin to spend your money on what you want.

SOURCE: Co-Operative Bank, 15/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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The key to offset mortgage success is to watch the pennies – if you keep a careful eye on your finances at all times you are bound to save more with an offset loan.

And you’d be amazed at how much the pennies can save you – money.co.uk has revealed that, on average, the nation’s shrapnel savers claim to have £24.54 squirreled away. Incredibly, that means as much as £385m could be stored in almost 16m jars, bottles and piggy banks across the UK – in a savings account that figure would fetch around £12m in gross annual interest and even more if it were to be invested into offset mortgages.

Chris Morling, managing director of money.co.uk, said: “It’s amazing how it all adds up. Twenty five pounds is hardly a king’s ransom when you look at each household in isolation but, together, it seems these penny pots contain a staggering amount of money.

“In fact, it would appear that the total amount ‘saved’ in this way has shot up over the last two years, from £100m in 2007. According to our figures, three times as many households are now ‘watching the pennies’, which explains the rise – perhaps simply because people are more careful with money in tougher times.”

This is just an illustration of how much you can save if you stick to routine, budgets and habits. Offset only works to its full if you invest into it each and every month. It might only be a few pounds each month stashed away in the piggy bank but that all helps towards reducing your debt and reducing your monthly outgoings.

SOURCE: Money.co.uk, 16/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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If you are angered when you see how little your savings are making in your ISA or savings account you can find solace in an offset mortgage that will make you money in this low rate environment.
 
The best buy savings deals are being pulled on a increasingly frequent basis and the 0.5% base rate set by the Bank of England to restore economic stability twelve months ago is continuing to hit UK savers hard – and as a result the rock bottom savings rates are making savers’ lives a misery.
 
Andrew Hagger at Moneynet says: “Until base rate starts to increase, there’s no prospect of savers seeing any meaningful increases on the paltry interest returns they are currently receiving. Even when rates do start to pick up, some providers will use the opportunity to restore their profit margins and won’t pass the full benefit on to savers.”
 
“It’s understandable that people are angry and frustrated with the current situation, but no matter how much noise they make, neither providers or the government are in a position to offer beleaguered savers a quick fix.”
 
But with an offset mortgage, a low rate environment is actually beneficial. It’s like a reverse savings product – instead of making money on interest, your savings reduce your rate of interest on your mortgage, so the more you save the less you pay each month. That, of course, means you have more money in your pocket.

So don’t get angry with the current situation as rates are unlikely to rise any time soon and traditional savings vehicles are just not going to make you money. Instead, be proactive and move your money into a mortgage that doesn’t need higher rates to be a success.

SOURCE: Moneynet, 09/02/10

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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If you search the Internet for offset mortgage adviser or talk to an offset mortgage adviser you will always hear the message ’shop around for the best offset mortgage’ because it is a complicated financial product. But what happens if you pick the wrong offset loan?

What is the worst that can happen? Well, if you opt for a loan without consulting an expert or without shopping around you will almost certainly end up with a loan that doesn’t work exactly with your income. You might be a self employed person and earn an erratic wage or you may be someone who works seasonally and earns more during some times in the year than others. For an offset to work you need a loan that maxmises your income and that might not be happening with the offset you chose.

You may also find that the offset you plumped for doesn’t allow you to access all your savings accounts and pots. If you have accounts and savings in all different directions then you want them all linked to your mortgage – essentially, the more you can offset against your mortgage the better. If your offset isn’t able to access everything then it isn’t making your money work as hard as it can.

It may also be the case that your income works so as an offset that calculates daily would benefit you, or vice-versa. A good offset loan works with your income and your outgoings – it’s a flexible loan, and should be able to work round you and not the other way round.

It may be that if you do not ask an expert before signing up for an offset mortgage you will still get a loan that helps you save money and is cheaper if you offset more against it. But you may be missing out on a world of benefits, of extras and breaks that save you even more money. And in these tough economic times the more you can save, the better.

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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If you have not got insurance to cover your offset mortgage the first thing you have to ask yourself is why – there are simply no good arguments against taking out good mortgage protection.

Some may say that they do not want to take out offset insurance because it’s too expensive. While it is true that insurance would be another outgoing, you can be sure that the saving benefits of an offset loan will more than cover any premiums.

Also if you think that you could not afford protection against loss of income, against damages to the property, against critical illness or even against death then how are you going to afford it if things do go wrong – how long could you afford to pay your mortgage if you lost a stream of income?

Some say that they are not interested in offset mortgage insurance because ‘it’ll never happen to them’. This, of course, is a foolish argument – none of us know what the future holds, but with some insurance against the bad things it’s easier to look forward to and plan for the good things that may come our way.

Some may also say that they do not need offset insurance because their flexible loan allows them to pay less and to take out lump sums during the tough times. This, again, is true but offset mortgage lenders are not infinitely generous – they will not let someone skip out on their mortgage responsibilities for too long.

So don’t take the risk – talk to an offset mortgage broker about insurance policies that will make sure to cover you and your mortgage should the worst happen.

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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We all want to save, but hopes of a healthy nest egg can be dashed after taking a peek at your monthly outgoings – you need an offset mortgage to give you the confidence to save.

This is because confidence is everything – if you are sure you can save, you can budget and you can plan. But if you think you may not be able to afford to save money each month that momentum is lost. Saving each and every month is hard work.

But with an offset, you know that the more money you invest into your mortgage, the lower your mortgage rate. That means you have an incentive to save and you know you will have extra money to put away each month as your mortgage rate shrinks. With an offset, saving can be guaranteed.

And now is a great time to think about saving – the recession seems to be leveling out and people are more comfortable about their prospects. In fact, according to National Savings and Investments, the British population is increasingly confident about the ability to save more in the coming year. Perhaps encouraged by recent reports of a financial upturn, over a quarter of the population are saying they are more likely to save money in the next 12 months than they did last year.

NS&I says: “People are increasingly confident that they will save more over the next year than they have done in the last year. Improving prospects in 2010 may be one reason, or it could be that people are taking the New Year as an opportunity to review and refresh their finances, and to increase their savings to boost their financial security.”

If you think your prospects are good to start some serious saving, help your chances by taking an offset mortgage. With the help of a professional financial adviser, your loan will work alongside your life and can make you some serious money. They will be able to pick out a mortgage that works around your income and outgoings, giving you the freedom to put aside exactly how much you want, each and every month.

SOURCE: NS&I, 04/01/09

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.

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If 2009 was the year of reducing debt and getting back into the black, 2010 is the year to use your clean slate alongside an offset mortgage to make your savings grow.

Many people spent the last 12 months clearing credit cards, overpaying on mortgages and getting clear of personal loans and store cards. And for those who have been successful in doing that, they now have the ability to make some real headway in growing their savings and their long-term financial potential.

This can be done simply with an offset mortgage – by offsetting your mortgage alongside a lump sum you reduce your monthly payments and give yourself more room to save more each month – savings that can then help reduce mortgage payments further each month. It’s the debt that helps you save, simply.

With the extra freedom you get with an offset, you’ll have more time and energy to scrutinize your outgoings. You can see more clearly where you are wasting money, where you can reduce outgoings and where you can save even more each month. It might mean checking your credit cards, comparing phone, TV and broadband prices or even making your home greener so as to reduce energy bills.

Martyn Hocking, editor of Which?, says: “If you make just one New Year’s resolution this year, make it that you’ll face your finances head on. Check what you’re paying for goods and services, and shop around for the best deals. Don’t settle for mediocre service either – vote with your feet and take your business elsewhere if you’re not happy.”

This goes for your mortgage too. If you are not able to save money each month because of an inflexible loan then move. Talk to a mortgage expert about a flexible loan that can help save more and can help set you free of financial stress in 2010.

SOURCE: Which?, 30/12/09

To stay abreast of current trends, news and comment on offseting mortgages visit the Offset Mortgage Blog.