1. Pay a little extra. An additional payment of $36 per week could save approx $100,000 on the interest cost of a $300,000 mortgage (30 year term at 7%). This would also shave six years off the term, imagine being mortgage free six years earlier.
2. Keep the extra payments optional. You can settup an automatic payment for the additional payments. This way you have control over the amount so that you can increase the payments with pay rises and decrease them when things are tight. With most banks you will only be able to do this on the floating portion of your home loan.
3. Throw in lump sum payments when you can. With a 30 year mortgage, a lump sum payment of $100 could save you around another $100 in interest. Thats like doubling your money!
4. Save for additional purchases, dont put your holiday etc on the mortgage. Improvements to the house can be a different story though, as often it can also improve the value.
