Repay Mortgage or Invest

Pugsley13

I have a £46K mortgage presently paying £245 pm @ 1.69%. My mortgage fixed rate expires May 2026.
I have an inheritance of £120 due. Should I repay my Mortgage or Invest @ 5.6 %

me1234

I assume that's meant to be £120k, not £120.  If it was me, I'd probably pay the mortgage off for peace of mind (esp as you're likely to see some kind of an increase in repayments when the fixed rate comes to an end).  How old are you? What are your financial circumstances?  

South_coast

Well you can afford to do both? Even after you pay off your £46k mortgage you'll still be left with £74k to invest. There will probably be an early repayment charge to pay on the mortgage if you clear it before the end of the fixed term, but given you'll be paying tax on your savings interest if you sit on the cash until then (you can only put £20k/year into an ISA plus £50k into premium bonds), you're probably better off paying the fee and then doing what you want with the rest of the money

pauldavies54321

Assuming it is 126k and not £126. It would surely be a no brainer to invest. Maybe in a fixed bond for 2 years. Higher rates, and then repay the mortgage when the fixed is due.

LadyWithAPlan

I think peace of mind is priceless given you could pay off and invest however would be worth doing some maths. 

Depending on your tax status would be worth putting extra into your pension this year as well as a start. 

Maybe pay the max you can off the house now (if 10% each year) as a lump sum and at  the start of next 2 years 10% , put the rest for house pay off in PB so when your re mortgage comes around you only have £28k or so to pay 

Or do as south coast says .. maybe lump sum the max extra OP this year and then when the new 10% kicks in OP pay the whole thing off 

I wonder if you put the remaining mortgage money in fixed non isa  investments  for 2 years that don’t pay the interest til the end of the term then that could mitigate the interest tax?