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Increase mortgage to invest in an ISA?
tojoslaffy
Posts: 23 Forumite
My wife and I have not used up our ISA allocations this year . Does it make sense in the long run to draw £10k down on our flexible mortgage at 4.75%svr and invest it in an ISA at 3.3%. I know the sums don't seem to make sense at the moment but does it make sense in the long term. Thanks everyone. T
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Comments
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No, it doesn't make sense."You were only supposed to blow the bl**dy doors off!!"0
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Stupid idea0
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Yes, it stands up there with ideas like an inflatable hammer or a 10 foot bonsai tree or a chocolate blow torch. It won't be better for you long term...Feb 2012 - onwards MF achieved
September 2016 - Back into clearing a mortgage - Was due to be paid off in 32 years in March 2047 -
April 2018 down to 28.00 months vs 30.04 months at normal payment.
Predicted mortgage clearing 03/2047 - now looking at 02/2045
Aims: 1) To pay off mortgage within 20 years - 20370 -
tojoslaffy wrote: »My wife and I have not used up our ISA allocations this year . Does it make sense in the long run to draw £10k down on our flexible mortgage at 4.75%svr and invest it in an ISA at 3.3%. I know the sums don't seem to make sense at the moment but does it make sense in the long term. Thanks everyone. T
It only makes sense if you draw down the cash for a short period.
This means you have minimised the amount of time exposed to the -1.45% interest rate but locked in the tax-free returns for ever.0 -
There are ISA,s paying 4.5% but you are looking at 3/5 year ISA,s and who knows what mortgage rates will be in 3/5 years as you are on the SVR.
If you are overpaying your mortgage by £10,000/15,000 a year and will be mortgage free in 2/3 years then building up savings in Cash ISA,s may be a good idea for long term savings/retirement0
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