Best choices as regards to investment and mortgage

esthomizzy

Circs are the following
Joint mortgage (with partner) of 139000, 15 years remaining
1.5k in premium bonds
3k in cash ISA

On an average month I have about £500 spare to save or spend and I'm a higher rate taxpayer. I still have large purchases for the flat to make - 1k every couple of months as I save it up so up until now and probably until the middle of next year my spare cash will go on these things but after that I want to have a plan to either make some money or take chunks out of the mortgage as fast as possible. I've worked out I can take our term down to 11 years by overpaying 272 each month or 375 would take it to 10 years (in 10 years I will be 38 and my bf 40). Our mortgage rate is a base rate tracker (4.75%) for 5 years (got at least 4.5 still to go and I can make overpayments of up to 10% pa).

In your opinions am I better off overpaying the mortgage (as a HRT effective best rate on my savings?) or putting whatever I have spare aside until I have enough money to put it into this years quota for a self select ISA? I am not adverse to risk and I'm mindful that the the investment route could allow me to pay off a chunk of the mortgage with the money at a later date some time.

Thefunkygibbons

Do you have any other rainy day money as for preference, I would not want to dip into an ISA or premium bonds for such needs

However, putting a sizeable chunk of your spare cash each month into the mortgage seems to be a sensible idea

esthomizzy

Well from time to time I have up to a 1000 but I've never really needed it so I think I'm going to use my ISA money as my emergency money because the worst that can happen is that I'll lose some interest and one years ISA allowance. The way I spend it's usually a struggle for me to get enough money for each years ISA allowance anyway (though as of next year I hope to have got through all my major expensive purchases) and be leaning more towards saving and investing.