With many choosing to go alcohol-free this January, Santander reported that putting some or all of the money usually spent on drinks toward mortgage overpayments could save homeowners thousands.
According to the Office for National Statistics (ONS), the average cost of a pint of lager is £4.81, a figure likely to rise.
Santander calculations indicated that if a homeowner puts the monthly cost of 12 pints (£57) toward overpaying a £200,000 mortgage over 25 years at 4.5%, they would save £12,983 in interest and be mortgage-free two years and one month earlier than planned.
Overpaying £144, the cost of 30 pints, on the same mortgage would save £28,373 in interest and reduce the term by four years and eight months.
Even small contributions can add up, as Santander accepts overpayments from just £10 per month, which could save more than £2,490 in interest and reduce the mortgage term by four months.
In the first week of January, nearly £100m (£96,993,570) was overpaid off mortgages, coinciding with the resetting of early repayment charges at the start of the year.
In 2024, Santander customers collectively overpaid £2.2bn.
Graham Sellar, head of intermediary channel – mortgages at Santander, said: “Whatever the reason for doing Dry January, there’s an indisputable benefit to your bank account.
“It’s tempting to spend that extra cash, but for those able to put even a small proportion of it aside, starting a habit of overpaying on your mortgage could reap huge benefits in the long run.”
