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PEPs - Keep or Cash in to reduce mortgage
scottishsue
Posts: 59 Forumite
Can anyone help. My husband and I have some PEPs which are now making money again. We are trying to reduce our mortgage (as per advice on this site). Are we better to keep the PEPs or is it more cost effective to cash them in and pay into the mortgage.
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Comments
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Its personal preference. However, things to note are that once you encash a PEP, you lose the tax free benefits forever. The tax free status can be beneficial over time. Particulary later in life when PEPS/ISAs can be used to provide a tax free income in retirement.
Depending on the funds portfolio you have, the potential for growth is likely to be higher than the mortgage payments. However, that would depend on your funds and the sectors invested.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Many thanks will take this into consideration0
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