Burning hole in my pockets

jimjames

I think there's a lot to be said for splitting it across different options so you aren't tied into one thing. Apart from the mortgage none of the other options will take the whole amount anyway so that probably makes it easier. Add to the pension, put some in a S&S ISA, pay off some mortgage, some in PBs. Also bear in mind that PB max is £50k so you wouldn't be able to put the whole lot in there anyway. If you have kids then some in a JISA might also be an option.

baggins11

We are mid 40s so can't do the Lisa unfortunately. I will look at fixed 1yr savings rates.

jimjames

baggins11 said:

We are mid 40s so can't do the Lisa unfortunately. I will look at fixed 1yr savings rates.

Have you replied to the wrong post?

Thrugelmir

anonmoose said:

Ok thanks for all the comments it has really helped.  I guess I expected people to say paying off the mortgage was a terrible idea but I guess that says a lot about the current economic position.

Debt has been cheap for a number of reasons over the past 2 decades. Many people have done extremely well by leveraging. Primarily down to good fortune rather than any particular skill, i.e. right time right place.  Unfortunately it doesn't mean that the next decade is going to be anything similar. Interest rates are likely to rise sharper than many are expecting. 

baggins11

JimJames yes I was replying to the poster before as I hadn't seen yours.

Splitting it between lots of pots does seem a common theme. I do have a isa earmarked for the kids when needed but wouldn't want any to go in a jisa as they are currently teens who seem lacking in any financial sense!

It will be interesting to see what interest rates will do thrugelmir as many people have never seen even what I would consider normal interest rates. (I know there is no normal)

P1Fanatic

anonmoose said:

I just checked my mortgage renewal and its actually 15months until I can re-mortgage and before then the redemption penalties make it pointless overpaying (apart from 10% I can overpay).

So looking at a 15month timeframe what are the best savings options for that chunk of money as all the interest rates look very poor with inflation as it is.  Would premium bonds be worth a punt or any other better options?

Based on that you should be able to overpay 10% right now (usually on the starting balance of the current mortgage year rather than the current balance) and another 10% in around 3 months when it rolls over into the final year (make sure you check the exact date). Also check first that any overpayment will be reducing the mortgage term and not just reducing your monthly payment.

anonmoose

Thanks P1. Yes I have already overpayed 10% for this Yr. My payment is reducing and not the term and I called them a while ago about this and they said they can't change it!! I am not sure this is true but it is only recalculated once a yr so shouldn't make much difference now. I have never bothered before as I have never been able to overpay at the max allowance so I just increased my overpayment direct debit by the corresponding amount everytime my mortgage payment reduced.

I also paid my max into pension for this Yr already.  I will need to look at my accounts end of march as I might be able to put a little extra in when finalised but not much.

MEM62

anonmoose said:

I guess the only thing is if there was a big dip in the stock markets then I wouldn't be able to take advantage of it apart from the drip feed.

You cannot time the market.  Investing is about time in the market - not timing the market.    

Albermarle

We have a sum of around £130k which was an inheritance My pension needs some attention so the first thing I will do is put in my max contributions for next few years.  This still leaves us with a 100k pot that obviously I don't want to leave in cash.  .

For your pension you say you put in maximum contributions . Do you mean you add 40K pa , or = to your gross income ?

Also not sure what your mean by this - My partners pension is on track and gets full employee allowance which is minimum allowed.

If you are not that far way from being able to take your pensions , but long enough away to rise out any market turbulence , then it is better to invest via them than via a S&S ISA due to the tax benefits. I am just wondering if you really are 'maxing out ' your contributions and whether your partner could also be adding more .

anonmoose

Yes my max gross contribution as I am low earning full time self employed. So probably 10 - 15k profit. My partners pension pot is bigger and he is main earner. His current company only give the minimum I think contribution and he pays in enough to get that and a bit more.

I would be happy to up partners pension contibution a bit but to be honest I gave up my career to be a stay at home mum for yrs and we neglected my pension a lot during those years.  

Also I wont be due any more inheritance in the future but he will. So if we ever separated he would be much better position and I would have used my inheritance to top up his already ok pension. Not had we are planning in separating but you don't know what the future holds.