Saving vs Paying into Mortgage

cannotCalculate

I need to understand what is better for me putting my money into savings or paying off my mortgage early.

The mortgage numbers are like this
Mortgage remaining: 241000
Term remaining: 17 years
Monthly payment: 1520

I have 50000 I can pay into the mortgage right now. And if things keep going as they are I could overpay 3000 per month getting rid of the the mortgage a lot sooner.

I could also open a fixed saving account. This gives me 4% over a 5 year period (I will pay tax on it though).
I am NOT going to open a regular saver account or any other saving account or product.

What option/s is best for me? Why ? Mortgage or Saving or some combination?

I have looked at the money saving experts overpayment calculator.
But dont know how I can get the best answer for me there.

Thanks for reading.

Waldorf_Statler

Put simply; can you achieve a better % return on your savings than the % interest on your mortgage? At £1,500 repayment per month over 17 year term on £241k of mortgage I guess you're paying around 3%? So, can you get a return greater than 3% on your savings?

Other considerations are whether you plan to move or remortgage any time soon. If you pay down your mortgage you might achieve a better LTV which could reduce your mortgage interest.

lalman

What I would do if you don't need the money is keep around 6 months cashflow separate in case of emergencies and put the rest into your mortgage. As Waldorf said 'can you achieve a better % return on your savings than the % interest on your mortgage'. Its highly unlikely particularly when you consider the higher rate tax you will have to pay... (I am assuming you are a higher rate tax payer if you are earning over 5-6k a month net). That you can get a higher return than your mortgage rate.