Mortgage Free in Three Yrs

FreedomGirl

Hi everyone,

Ooooh, I can't believe that I didn't make that link

I just thought to myself, what's a small room in the house that's about 5% of the floor area?

But you guys are geniuses (genii?)

bank=money down the loo.

then

bank=flushed down the loo


Absolutely priceless Fantastic. Thanks for making me smile

FG

Moneygoes2money

Kaz2904 wrote: »

But you don't pay tax on ISAs which is why you have to use your allowance or lose it.

Let's say the mortgage is 6% and the cash ISA 5.5%. What is the point in receiving interest at 5.5% while you are paying interest at 6%? It simply doesn't make sense. I appreciate you will lose your ISA allowance if you don't use it but so what?

angelavdavis

Well, paid another £41.25 + £10.66 off the capital today (both Quidco payments) and £5000 into the offset (stoozed funds). Have also earned £30 from AQA this month (after tax) which will go onto the capital as soon as I have received this.

Am off up to London with DH this weekend, off to the Dive Show (tickets c/o Tesco Deals) and staying at a hotel in the City for free (loyalty points!) Am hoping DH will pay for meals and train tickets with a bit of luck!!!

TallGirl

I love hearing about people saving money using points etc and it looks like you are in for a nice weekend Angeladavis. I have just booked our ferry to Denmark this summer got a £245 discount by converting 3900 Airmiles. Got the price down to £471 which is still a total rip off but I want to have the car there.

angelavdavis

I know what you mean about rip off - I am guessing it is a pretty limited market, its annoying, but I do think 30% odd discount is a pretty good deal that you got under the circumstances - well done you!

The weekend for us is a bit of an indulgence so I was happy about getting the deals, but we are also going away to Sharm diving for a week soon, so we are being really bad this month! What with these indulgences and the ISA payment, the overpayments are likely to be hit this month!

TallGirl

Yes holidays can be expensive but if you can get a good deal it feels so much nicer. I love your motto refusing to be ripped off :rotfl:

setmefree2

Moneygoes2money wrote: »

Let's say the mortgage is 6% and the cash ISA 5.5%. What is the point in receiving interest at 5.5% while you are paying interest at 6%? It simply doesn't make sense. I appreciate you will lose your ISA allowance if you don't use it but so what?

Hi

An ISA is a tax free investment and it produces a tax free income "forever". So this has to be taken into the equation rather than just a staright comparison of rates - ISA rate vs Mortgage rate.

For example, when you're are 60 - if you have used your full allowance year on year, you can have an investment which gives you a tax free income every year. Unlike a pension, building society interest, etc which even when you are retired are taxable income.
So if I build up a saving of £80k, I will have a tax free income of £5200 every year.(In a 6.5% cash ISA) The equivalent of £7429 of taxable income.

However, to build up such an investment you have to use your allowance every year - once the oppotunity to do so has gone - it's gone...

Hope that makes sense:rolleyes:

There are loads of good deals here:- You should be easily able to beat your mortgage rate.

http://forums.moneysavingexpert.com/showthread.html?t=401374

ailuro2

I hear what you're saying about ISAs, which is relevant if you choose to save money up and then leave it there indefinitely.

Some people prefer to invest in bricks and mortar as their long term investments (yes I know a slow down is coming, but look at the historical data and rpercentages) They can't raid it to go on a much needed holiday quite as easily as with an ISA.;) Different strokes for different folks, neither of which is wrong.

Perhaps when I'm 60 and have finished paying off the mortgage on a larger home I'll sell up, buy a beach hut in the Caribbean and give the rest to my DD

Or maybe I'll downsize and use the big pot of money to fund a retirement's worth of boiled sweets, blue rinses and SAGA holidays.

One thing common to us all- we can't take it with us!

Move_To_Portugal

''One thing common to us all- we can't take it with us!''

So true:D

Dumbledore55

Hi

I wonder if anyone can help. I've got £1500 saved that I was going to use to buy an ISA in April - ICESAVE - 6.1%. I'm a high rate tax payer with a mortgage interest rate of 5.9%. Should I buy the ISA or pay it off the mortgage for best value?