How do I make the best of a good situation?

whatwouldcroesusdo

Hello everyone,
This is my first ever post on any forum so please forgive me if I don't get it quite right. Essentially I am after some advice*, I could come up with an answer myself but I know that there is a huge amount of experience on this forum (I read it quite often and I am a huge fan of MSE) and I would like to use it if you are kind enough to give it to me.

I am in a very lucky position and am very aware of how fortunate I am but I want to make the best of it. I am in the Armed Forces and live in services accommodation (or a ditch depending on where Her Majesty sends me!). I have managed to buy, over the course of a few years, a flat and a house, both of which I rent out and across the two the rents cover the mortgages. One is an interest only and the other is repayment.

The Issue:

I have been over paying on my mortgages since I got them (learning lessons from my parents) and I am a big fan ; looking at how much interest you save and knowing in the future that I can have that feeling of security by having paid the mortgage off.

However........is this the best thing for me to be doing? Bearing in mind that the rent covers the mortgage, am I better off investing the money else where (and if so where? But that is a whole other area of research!).

At the moment I do not have any 'dependants' at the moment but can see it going that way in the next few years (girlfriend keeps talking about babies!). I mention this as it may make a difference to your advice.

Thank you for reading this and thank you in advance for any thoughts you have.

*=I am aware of advice being a 'dodgy' word but, worry not, I will not go and sort all my finances based solely on what people post here, I will think about it quite deeply and research it elsewhere!:)

Lokolo

This is quite simple.

When you can get better interest rates in savings, you don't want to overpay and vice versa.

say you have £1,000. Do you want to overpay or save?

If the mortgage is 0.5% and savings are 2.5%.

Over the course of 1 year, the mortgage would have £5 less interest added if you put the money in there. So you are effectively saving £5 in interest.

If you put the money into savings, you would have £25 in interest.