What would you do in my position?

Type_45

Current situation:
- House is worth approx £290k.
- Mortgage of £70k, which is 0.75% above BoE for life.
- I pay interest-only on the mortgage, not repay. Mortgage is about £48 per month.
- Investments: £75k in VLS100. £2k in Bitcoin.
- No debts other than the mortgage.
- Work pension scheme in place.


If interest rates go up, and VLS goes down in value, I may wish I'd paid some mortgage off? 
Or maybe sell some VLS100 and diversify into another stock, or add bonds, or buy some gold? Or stay as I am and ride out any recession/storms knowing that the stock market will eventually recover and I can pay off the mortgage at a later date?

MX5huggy

Do you have any other savings? An emergency fund? How old are you? Is your pension in good order could a lump sum from this pay off the mortgage. How tight is your monthly budget could you afford 5% base rates? 

Thrugelmir

Type_45 said:

If interest rates go up, and VLS goes down in value, I may wish I'd paid some mortgage off? 

Hence why leveraging with debt is double edged. Both gains and losses are magnified.  Money held with a pension isn't easily accessible , despite it being the most tax efficient way of saving. Personally I always split savings 3 ways.  Cover all bases. Optimisation over maximisation. 

Steve182

My mortgage is also the same rate as yours. It's virtually an interest free loan. Don't pay it off any faster than you need to if you have any appetite to invest.

Personally I would invest any surplus in S/S, whether that be in an ISA or by increasing pension.

RetSol

Mortgage of £70k, which is 0.75% above BoE for life.

How old are you and when exactly is the mortgage repayable?  "Life" does not usually mean "life" when it comes to mortgages. 

Steve182

RetSol said:

Mortgage of £70k, which is 0.75% above BoE for life.

How old are you and when exactly is the mortgage repayable?  "Life" does not usually mean "life" when it comes to mortgages. 

OP's mortgage deal was not uncommon pre-financial crisis, it's identical to mine. BOE base +0.75 until end of mortgage term.

Type_45

I'm mid-40s. 
Remaining term on my 0.75% above BoE base rate is 16 years.

Thrugelmir

I was fortunate enough to sign up to 0.35% above base in 2007.  Just repaid the mortgage quicker as interest rates fell. 

Type_45

Thrugelmir said:

I was fortunate enough to sign up to 0.35% above base in 2007.  Just repaid the mortgage quicker as interest rates fell. 

Is it worth paying it off, though, as it's free money?

But as I said above, the flip side is that if interest rates (and your mortgage payments) go up, and your investments go down, you'll wish you'd paid it off (or some of it) when you had the chance.

TheAble

I'd get it paid off personally because I don't like humping debt around, especially into retirement. Would probably try and do it over 5 years.

MX5huggy

I wouldn’t pay it off, but I would dial down the risk of your investments, if you have no other savings. Maybe LS 80 or 60 for the majority, LS 100 is not really like the other LS.