Invest Pension in Mortgage?

ForumUser

I am returning to the UK having worked abroad and have the opportunity to withdraw my pension from my current employer with only 3% withholding tax. After tax this would give me about 250k. I'm 35.

I'm buying a UK property for 900k and have 450k deposit available and have approval for a 450k mortgage.

What do the forum users think - invest the pension money to reduce the mortgage, or transfer into other investments? We have substantial costs to transfer our household to the UK, so the chance of reduced monthly payments is attractive for a few years, but I worry about having "all my eggs in one basket"

Appreciate any advice
:A

molerat

What are you planning to live on when you retire ?

ForumUser

Savings in mortgage payments would then be redirected into a new pension.

Withdrawing pension money with 3% tax abroad, having a much smaller mortgage, and then investing savings into UK pension with tax relief at 45% seems like an incredible deal, or am i missing something here?

were

You need a time machine to see what the future holds for you. You can not count on anything till the day you take your money out, or retire.

I have to say that the current pension scheme is pretty poor and capped. With hind sight i wish I had put my money into more property, rather than pension. Now 35 years to pay into a pension pot, plus only getting that pot at 67 (but this will go up) feels like a stealth tax. Few live long enough to get the money they put in, and only 37% will be able to claim the maximum £151 a week.

About 1/3 of marriages get divorced. Think there is a 33 times more chance that you become disabled, rather than die. Then there are kids that often need feeding and property becoming to small. You cant get your pension payouts can vary according to country you live in, and so does the yearly increment, if there is one. health is a big factor. Who knows if you will be employable in 20 years time as various professions have died, and people often get more menial forms of work.

I would say diversify, would generally give a better return, than a lesser mortgage.

My friend and I discussed this in some length, and currently he is looking into a wealth protection schemes, as the old BTL schemes now offer minimum tax offset, Trust schemes are far from efficient as they once were - spoke to solicitor about these, ir35 is killing the government sector and at the end of March we are having mass exodus of highly skilled contractors due to what they class as excessive taxation.

I and not mentioning shares, as I have done badly in them, so count them as gambling, or russian roulette