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Strategy review please
MartialArtMan
Posts: 581 Forumite
I'm 43 and still have 21 years left to pay on my mortgage! (So many regrets right now 
) Anyway I owe approx 104k at a fixed rate of 1.78% which works out approx £500 per month.
I was thinking about paying an extra £150 pm off the mortgage which according to the mortgage over payment calculator will reduce my term by 5 years and 7 months so it'll be paid by time I'm 60 however I have seen an alternative strategy that I am considering; instead of paying extra of the mortgage I could put the money into a Stocks and Shares ISA which returns on average 6-8% per annum over a 10 year period. In approximately 16 years time I should have approximately £80k in savings and be earning enough interest to skim it off the account to start paying the monthly mortgage payments instead of using my wages. That way I will have a reasonable amount of savings to add to my pension and my mortgage will be paid out of a passive income.
Whats your opinions please?
) Anyway I owe approx 104k at a fixed rate of 1.78% which works out approx £500 per month. I was thinking about paying an extra £150 pm off the mortgage which according to the mortgage over payment calculator will reduce my term by 5 years and 7 months so it'll be paid by time I'm 60 however I have seen an alternative strategy that I am considering; instead of paying extra of the mortgage I could put the money into a Stocks and Shares ISA which returns on average 6-8% per annum over a 10 year period. In approximately 16 years time I should have approximately £80k in savings and be earning enough interest to skim it off the account to start paying the monthly mortgage payments instead of using my wages. That way I will have a reasonable amount of savings to add to my pension and my mortgage will be paid out of a passive income.
Whats your opinions please?
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Comments
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Don't know whether to take the lack of response as a positive or negative so I'll just follow that strategy and report back in 15 years time
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you will get mixed advice on here and I think it depends on your personal circumstances. Investing in a pension would save you tax if you're a higher earner, but mortgage freedom may offer piece of mind. Everyone has a different opinion. Good luck though!
Mortgage start date Nov 2014 - £90,545 over 25 years
Re-mortgage Oct 2017 - 78,295 over 23 years
Re-mortgage Jan 2020 - 55,000 over 26 years @ 1.94%
Current Mortgage Outstanding Middle December 2020 - £47893.35 - a reduction of £42,652 in just over 6 years!1
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