Special repayment, saving or consumption?

2022-06-17 11:21:09

2% repayment at 1.4% interest rate over 20 years.

As already mentioned, sure, paying off debt, building reserves, investing, whatever... but on the other hand, the question is, is it worth it? Inflation, 20-year term, spouse will work 20-30 hours again in 5 years (the remaining term would then be 15 years); not start going full throttle again then?

2022-06-17 11:37:37

Is it worth it? Inflation, 20 years duration, spouse works again in 5 years for 20-30 hours (then the remaining term would be 15 years); not then ramping up again?

Just some food for thought: Does the salary increase at the same rate as inflation? Will the spouse really work again in 5 years? (For example, more children) Will the spouse really work 20-30 hours again or less? Will the spouse get the appropriate job, or will less be earned than expected and additional costs like a second car eat up the salary? General life risks like illness, job loss, divorce, etc. New car, new heating system, new roof, or other expensive purchases It remains the same, no one can make the decision for you.

2022-06-17 12:12:27

2% repayment at 1.4% interest rate over 20 years.

As already mentioned, sure, pay off debts, build reserves, invest, however... but on the other hand, the question is, is it worth it? Inflation, 20 years term, spouse will work again in 5 years for 20-30 hours (then the remaining term would still be 15 years); not then start pushing again?

Here, basically, no repayment is made either. :rolleyes:
Yeah. That almost reads like, "We'll do the outdoor facilities later".... only, with what money?

2022-06-17 13:19:40

We have only one child, waived expensive extras and unnecessary square meters during construction, and consciously decided on a significantly lower rate.
If you were to spread all the special repayments over the previous roughly 100 months, we would also only be at about €1800 monthly rate. Of course, the last 2-3 years much more.

What must always be emphasized, however, is that salaries naturally increase over time, while the loan remains a large, constant item in the expenses, making it significantly easier to make special repayments or save money.
I think some who have perhaps built young now and still have some salary jumps ahead of them will be laughing about their rate in a few years. If salaries reasonably keep pace with inflation rates, borrowers are well served. 2022 will certainly be difficult, but permanent real wage losses with almost full employment will hardly occur.

Since we are still driving the environment into the wall, it is even very likely that there will be very massive material welfare losses in the next 50 years: either through a significant reduction in material consumption or because certain things simply will no longer exist. The consideration of the short-term static economic system will not lead any further.

Before that, we will have to overcome demographic change together, which will also be very painful, and actually already is. Over €100 billion annually flow from the federal budget into pensions and health insurance (pensioners also incur the highest expenses with low contributions). If the pension system had been reformed in time, the state could slowly reduce debt, invest, and would not need special funds.

2022-06-17 13:24:54

Here, basically, no repayment is made either. :rolleyes:
Yeah. That almost reads like, "We'll do the landscaping later"... only, with what money?

Instead of repaying 3%, I invest the difference from 2 to 3% in ETFs over 20 years.

2022-06-17 14:42:36

Instead of repaying 3%, I invest the difference between 2 and 3% in ETFs over 20 years.

…as if ETFs were a free ticket to making money ;) There are also counterexamples… Besides, I don’t believe that one simply liquidates a fund, i.e., sells it, if it has been going "(only) up" for 20 years. I just wanted to mention it. Everyone can do whatever they want with their money.

Special repayment, saving or consumption?

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