Mortgage Pay-Off Advice

AppleHunter

Looking for opinions on whether I'm making the right financial decision or not.

My low fixed rate mortgage ends next year, at which point the payments will go up a fair bit (or I could likely extend the term). The outstanding balance will be a bit over £100k.

I'm currently lucky enough to be in a position where I can save £20k a year, which I put into an investment ISA using the full allowance, intended to be a long term investment. By the time I need to renew my mortgage, my savings there will be pretty much equal to my outstanding mortgage.

Is the wisest financial decision to:
  a)   Pay off my mortgage. Avoids the high rates, but then I'd be wasting the past several years of ISA allowance, and in the future I'll be able to save around £35k, so will start looking at taxable options.
  b)   Get a new mortgage and keep my savings. Means I still have a mortgage for another several years at high rates, but might be the better long-term, tax-efficient option.

I'm leaning towards option B - it was my plan before rates got so high. But I would love to get a sense check from financially savvy people if my thinking is sensible or daft. Many thanks .

savingholmes

I would review your pension provision - as that would give you tax relief so potentially would be even better than the isa in the long term. It depends how far away from retirement you are. But if your isa savings rate or similar gives you a higher interest rate than you are paying on the mortgage that is also a good option.