Special repayment, saving or consumption?

Everyone pursues their own goals with a house....and so both are correct.

Special repayments with an interest rate of 0.xx%? No way...

Better than my Wirecard fiasco

I would say that there is no right or wrong here - it just depends.

At an interest rate of 0.xx %, it actually makes little sense at first glance to make special repayments if you have suitable investment opportunities that yield a higher return.

On the other hand, I also find it appealing to simply be completely finished with the repayment a few years earlier and to have more money in your pocket every month due to the elimination of the monthly annuity.

We are currently taking a middle course. We actually use part of the money we have left over directly for special repayments. The other part we save/invest in various investments with different returns.

We tried to include the special repayment in our financing - it didn’t work. So we will try to repay the KFW after 10 years and then take it easy from there. At 0.85%, I didn’t really care in the end.

Let’s see how well saving on the side works. Before the first 1-2 years, I’m already a bit nervous when all the little things around the house and garden need to be done. The second car is already acting up a bit and then we’re also installing a Wallbox on the wall. Let’s see how much I can hold back on consumption.

I have also thought for a long time about whether it makes sense or if I should rather invest the money in the stock market for the long term. But since I am already invested anyway, I have decided to use part of the safe asset class as a special repayment. So I am basically getting our loan interest rate of 1.83% on part of the asset class. In case I want to invest more after a price drop, there is still some funds available. It is a middle way for me that I can live well with.

At 0.xx%, it actually makes little sense at first glance to make large special repayments. It makes a big difference whether I have to beat 0.x% after taxes or 3% after taxes with the investment. On the other hand, it also feels good when the debt burden decreases significantly year after year and the calculated end moves forward year after year. I must admit, I also find it difficult with surplus capital in a faltering economy, Corona at the door, stock markets at all-time highs, providing for the family, repaying credit, and still taking full risk with investments. Therefore, I also take a middle path.