Pay off mortgage or invest??

Thrugelmir

How secure is your employment? For many people owning ones property outright is a major safety net. As is normally the largest monthly outgoing. Chances of finding decent employment do diminish as one gets older. 

MEM62

Thrugelmir said:

How secure is your employment? For many people owning ones property outright is a major safety net. As is normally the largest monthly outgoing. Chances of finding decent employment do diminish as one gets older. 

That is a very good point.  

mjb-is

What is your mortgage rate? Typical rates at present would be 1.5-2.0% for most people so that is your effective return on investment if you do that.

The fact that you mention this says to me that you don't need that cash longer term.

A Stocks & Shares ISA is another possibility for the medium to long term, but many people get nervous if they see value going down before it goes back up again long term.

Pension is a very safe and tax efficient option, as long as it is a long term view. If you are a 20% tax payer then every £1 would get you £1.25 in your fund, so an immediate 25% bonus before it even starts growing. Again funds can ebb and flow, but most people don't look at the value regularly like they would  an ISA account.

Another option, with that kind of sum, is that it would fund a house deposit in many areas of the country so you could actually buy another property with a BTL mortgage. This gives both monthly cashflow and a longer term capital growth (if it is in the right area). However, it isn't a passive investment and would involve additional borrowing, which many aren't comfortable with, especially if they have the 'mortgage free' mindset rather than 'how can I increase income and assets value' mindset. Even with a personal mortgage, if you have enough monthly rental income to cover that then you are effectively personal mortgage free, as rental profit pays your mortgage, but you have multiple high value assets for the long term.