Redundancy-should I pay my mortgage off

chrissiewants2save

Sycorax wrote: »

Apart from the obvious working out if you can get more interest investing the redundancy vs what interest rate you're paying on your mortgage, there is the emotional aspect to this...

Paying off a mortgage is aspirational and relieves you of a psychological millstone. So this may not be as 'simple' as working out the finances, there may be head versus heart issue that you need to resolve too...

You don't mention what sector your hubby works in or his pension arrangements. But there may be a possibility that his pension scheme allows to claim pension early if made redundant. If he can claim his pension at 55 or 60, would this make a difference?

You have a very good point there...
Private pension, not a great pot and as we are 44 it's a while off yet. Hubby works in hospitality sector, restaurants, coffee chains and the like. Not the best industry to be in at the moment unless you are a big player.

patman99

If you have PPI for the mortgage, then let that pay the mortgage for a year whilst your oh looks for a job. Once back in employment he will be in a position where paying-off the mortgage will not harm any future MTB claims.
If he even over-pays the mortgage now, then when he claims certain benefits, they will still count the full amount as if he still had it. It is referred to as 'deliberate deprivation of assets' and is frowned on by the DWP.
Once you are in work, what you do with your money is your problem, not the DWP's.

zzzLazyDaisy

patman99 wrote: »

If he even over-pays the mortgage now, then when he claims certain benefits, they will still count the full amount as if he still had it. It is referred to as 'deliberate deprivation of assets' and is frowned on by the DWP.
Once you are in work, what you do with your money is your problem, not the DWP's.

This is true, but it is only relevant IF they are eligible for means tested benefits. Based on what OP has said about her earnings, they won't be eligible for means tested benefits (though OP should double check this on the turn2us website).

OP - it is always useful to have some savings in case of emergencies, so provided that your job is as safe as any jobs are likely to be in the current economic climate, and provided you are not entitled to means tested benefits once your OH loses his CB JSA in 6 months time, then my own personal approach would be to put some money aside to tide me over for the next year or so (when hopefully OH will be back in work again) and use the rest to pay down/off the mortgage.

chrissiewants2save

zzzLazyDaisy wrote: »

This is true, but it is only relevant IF they are eligible for means tested benefits. Based on what OP has said about her earnings, they won't be eligible for means tested benefits (though OP should double check this on the turn2us website).

OP - it is always useful to have some savings in case of emergencies, so provided that your job is as safe as any jobs are likely to be in the current economic climate, and provided you are not entitled to means tested benefits once your OH loses his CB JSA in 6 months time, then my own personal approach would be to put some money aside to tide me over for the next year or so (when hopefully OH will be back in work again) and use the rest to pay down/off the mortgage.

Well, I'm a civil servant, part time and my job has been threatened twice by redundancy and it is not a safe civil servant job like they used to be.
I've done some checking. Mortgage rate is actually 2.19% so according to the mortgage calculator i can get a saving rate which makes it worth saving the money then using that to continue to pay the mortgage, therefore same principle but separate from my income as my income is not enough to include mortgage.
I wonder about inflation on my savings, another quandary.
As to benefits, I did check and we are not entitle to any other than his cont.based JA.
As ever it all goes against the working person who try's to save and protect their future.

getmore4less

chrissiewants2save wrote: »

I wonder about inflation on my savings, another quandary.
.

It does not matter, it is there to pay of the mortgage.

mumf

I have skimmed through the replies. Lots of advice. I am facing redundancy now. However we paid off our remaining six years. Let me tell you, IT IS A LIBERATION! You say you can get by on your money. Then get by. Money is just a resource, use it for your security. Do not just sit looking at the figures in a bank book.
I know when my job goes how little I need to earn-not how much!

zzzLazyDaisy

That is very true. When I was left disabled after a car accident, I was so pleased that I had paid my mortgage off earlier. I have blessed that decision many times since, as no housing costs has made a huge difference to my ability to manage financially.

ian103

we paid our mortgage off a few years ago and hen I lost my job through redundancy it made me realise how few financial worrries we had as my colleagues were panicing about paying the mortgage and that was at the start of the recession.