Higher rate tax payer

NeverThoughtIdSayIt

I'm 42 years old living with my wife and 3 kids & our mortgage is our only debt.


I'm a high rate tax payer and already utilise both mine and my wife's ISA allowances (inc. S&S)


Any suggestions as to what to do with any extra income we might have each month?


Thanks

Lokolo

Spend it or overpay mortgage.

Archi_Bald

Put it into your pension.

Annisele

What rate are you paying on your mortgage?

PeacefulWaters

Pension for you, utilising matching employer contributions if possible. 40% tax relief.

Same for your wife. If she's a lower earner she may end up getting tax relief now and paying no tax on the pension income.

Junior ISAs for the kids.

A more fuel efficient, road tax efficient, cheaper insurance car.

New boiler if the old one is over 12 years old.

Home insulation that will reduce your heating bills.

Overpaying the mortgage.

Nicer / more holidays.

Payroll giving to a deserving charity.

Value adding home improvements.

atush

As a 40% taxpayer, got to be a pension for you for sure.

Each 100 into your pension will only cost you 60. What ISa or savings acct is going to do this for you?

sandsy

A pension, for sure!
For basic rate taxpayers, pensions and ISAs are pretty equal - one gets 20% tax relief on the way in, the other gets it on the way out.
But for a higher rate tax payer, the 40% tax relief on the contributions puts it ahead of an ISA, especially if you're likely to reduce to being a basic rate tax payer in retirement.

tushingham

yup pension....and what peaceful waters said above in any order than suits you (after pensions!!!)
big advocate of spending some