Paying into pension V's overpaying mortgage.

232607

atush wrote: »

Good so you meet that deadline.

Your biggest problem will be should they call for the money at 55 and not allow you to go repayment- ie refuse to extend at all. They can do this. which is why I dont like int only mtgs on a main home (as opposed to BTL where they make more sense).

But it still doesn't alter the figures I worked out when I'd be 55. IE:- £33.6K owing on mortgage but a gross £56K (£47.6K net) extra in pension as a result of me taking this action.
For this reason if they don't want to extend the mortgage it still makes sense to ge ahead with this idea.

I'm coming to the conclusion that I will drop the mortgage & increase the pension.

Thanks all.

atush

Dont forget tax in your pension workings. You can only take 25% Tax free from your pot, and any more taken would be taxed as income.

So anymore taken over that could easily slap you back into the HRTax band if you aren't careful? You could plan around this putting more in from savings just before you take your TF pot but you have to be careful of the recycling rules.

232607

atush wrote: »

Dont forget tax in your pension workings. You can only take 25% Tax free from your pot, and any more taken would be taxed as income.

So anymore taken over that could easily slap you back into the HRTax band if you aren't careful? You could plan around this putting more in from savings just before you take your TF pot but you have to be careful of the recycling rules.

Thanks & I have considered this. When I'm 55 They'll be about £160 - £170K in the DC so the 25% TFLS should easily cover the 33.6K needed.

atush

Gotcha. Sounds like a plan then, if you are comfortable with 6 months emergency cash.

I might add extra though if you have upcoming known expenses such as holiday, car replacement etc.