Should we pay off mortgage with early retirement funds or re-invest

TA_TWO

My husband has been offered early retirement we also have one of our two endowments maturing in September we don't know if we should use all funds to pay off mortgage or re-inbvest into another property. The funds we have should be about £125.000.

getmore4less

What are you long term goals

How does buying another property fit those goals.


If you had had a smaller mortgage would you have borrowed money to buy another house?

weezl74

Hiya


more detail will definitely help the folk on here give you better advice.

How much is outstanding on your mortgage, what is your interest rate and how much can you overpay without incurring a penalty?

Welcome to MFW

TA_TWO

Thanks for info here is more info. Mortgage remaining is 80 grand first endowment will pay of 35 grand retuirement funds will clear rest , but should we do that or use funds to buy another property as it is an interest only mortgage which we can afford to pay monthly and so would new property be a better investment in the long term ..Our long term goal is to retire broad when and if the pound improves.

RenovationMan

Is the property you're thinking of investing in abroad or in this country? If it's this country and you're thinking of moving overseas, then are you sure you want to tie up your capital in two UK properties?

When does your second endowment mature and how does its maturation date fit in with your retirement plans? I ask this because if it does mature within the right timescale for your move overseas and will cover your mortgage then I'd sit tight and use your endowments to pay off the mortgage, after all that's what they're there for.

I'm assuming that the early retirement money is comprised of your 25% tax free lump sum that you're allowed to remove from your pension. Have you looked into the sort of return you'll get from your pension with this money removed and with it left alone? It might be the case that by removing the money you're reducing your income significantly in retirement and may struggle financially.

With sums this large and with the decisions being one-offs, it might be worth paying a few quid to an independant financial advisor to get decent advice.