What would you do?

bmthmark

Hi

I currently have £160k mortgage that I am trying to pay off.

I've been lucky that I am in a fixed rate of 0.99% over 5 years so my monthly mortgage payment is approx £890.

I have been overpaying £500 a month as well as this is making it drop quite quickly.

I've also been saving (approx £500 a month) and I am currently at £16k, this isn't for anything in particular. More an emergency if I were to be out of a job etc. My intial plan was to save up £20k. 

But I'm thinking now I should maybe pay more off the mortgage now. I can pay upto 10% overpayments without any charges.

So my question is: do you think I should either pay more in overpayments? carry on saving (rubbish interest rate)? or save and pay a lump sum off mortgage at the end of each year?

I have a good pension with my work, so I don't need to add anything extra to that.

I'm just not sure what to do. What would you do if you were in my shoes?

Thanks

Mark

jimjames

I would (and have) invested money into a S&S ISA instead of paying off the mortgage faster. Each to their own but for me it's worked out brilliantly with a nice investment pot that could have cleared the mortgage several times over. Obviously it's not guaranteed but long term it should be better than savings or mortgage overpayments.

bmthmark

jimjames said:

I would (and have) invested money into a S&S ISA instead of paying off the mortgage faster. Each to their own but for me it's worked out brilliantly with a nice investment pot that could have cleared the mortgage several times over. Obviously it's not guaranteed but long term it should be better than savings or mortgage overpayments.

Thanks, I started to look at this but didn't know how to set it all up.
Do they allow you to pay for example £400 a month?
Also I understand you can select the type of risk. Do you have an example of the kind of profit you could get back after a certain amount of time?