Pay off Mortgage or Invest the Money

paye Posts: 447
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edited 15 May 2021 at 11:27PM in Mortgage-free wannabe
Through  hardwork and help from family I'm  in a position where I could pay off my Mortgage fully tomorrow  :)
When my 5 year fixed rate ends next Febuary I'll have an oustanding balance  of circa £180k left on the mortgage. 
What do you think I should do pay off the  mortgage or  invest the money in buying another property for investment purposes?

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  • FaceHead
    FaceHead Posts: 737
    First Anniversary First Post Name Dropper
    This question applies to any sort of overpaying, and really it's the same as 'should I take secured borrowing and invest it'.

    Statistically, yes. Equities returns have typically been more than mortgage interest rates and this has therefore been a good move. If you have room in your pension and are not too far off 55, it becomes a no brainer to pension (some of) the money. 

    Alongside age and pensions, the main thing to consider is: could you afford to lose 25% of the investment? If you can afford to lose it, then your risk appetite might be such that you'll go with the statistics. If a significant decline in equities prices would blow a massive hole in your future, then perhaps you should play it safe. 
  • ElmoR
    ElmoR Posts: 398
    First Anniversary Name Dropper First Post
    As above, it depends on what you want to achieve? Maximise the pot in terms of possible interest/dividends or peace of mind (sleeping well at night) with no mortgage hanging round your neck, or a combo of both?
    This is the 'mortgage-free wannabe' group, so getting rid of the mortgage is deemed slightly more important for some here than perhaps for other people on the 'savings and investments' or 'pensions...' groups. You could ask on those two as well and will get similar but different answers. They will need to know your age, current pension provisions and attitude to risk to be able to offer comments.

  • paye
    paye Posts: 447
    First Anniversary First Post Combo Breaker
    Thank you for the replies, As advised  I'll repost this in the 'Savings & Investment' forum as I may have posted this in the wrong section.
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    SPC 593 paye:o
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