What do do when you're mortgage free?
Comments
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I agree. And it’s very easy to get more than 2% interest on your money, 3% at least.
fc
Not if you don't want to take any risks. Investing in the stock market is risky. I am not saying it shouldn't be done, but it's not the same as putting the money in an FSCS-backed saving account.0 -
SouthLondonUser wrote: »Not if you don't want to take any risks. Investing in the stock market is risky. I am not saying it shouldn't be done, but it's not the same as putting the money in an FSCS-backed saving account.
https://uk.virginmoney.com/savings/products/regular_saver_issue_19
...to name but one.
I’m not arguing with you here, you are entitled to do with your money as you wish. It’s just a response to your original post, an alternative view that makes more of your money. Nothing to do with the stock market.
This very website explains how to get 5% with M&S for goodness sake!
https://bank.marksandspencer.com/save-invest/monthly-saver/
Yes it’s a hassle for some, a hobby for others, and the feeling of being mortgage free is surely worth a quid or two... entirely up to you.
fcFeb 2008, 20year lifetime tracker with "Sproggit and Sylvester"... 0.14% + base for 2 years, then 0.99% + base for life of mortgage...base was 5.5% in 2008...but not for long. Credit to my mortgage broker0 -
Steve123456789 wrote: »I hate working. It's spending all day, 5 days a week working for someone else, who doesn't pay you what you're worth.
You can work for yourself, there are still industries that pay good money.
You might end up enjoying working.0 -
These monthly saver accounts let you invest no more than £250/£300 per month. That's peanuts. It may be worth putting the money there rather than overpaying the mortgage by the same amount.
But you certainly cannot invest any reasonable amounts, any amounts comparable to that of a mortgage balance, in these regular saver accounts.
In an earlier post I clearly wrote that you must consider not just the hassle but also taxes and the fixed fees of a mortgage. Spending £500 to remortgage and then investing a significant sum in a saving account at 2% might make sense. But remortgaging to then invest peanuts in a regular saving account wouldn't.0 -
Yes I was only thinking of putting the overpayment money to better use with regular savers, easy to have 3 or 4 on the go and that’s maybe all that’s needed, depends on overpayments.
If OP sees this as too much hassle for too little reward that’s fair enough, but this is a money saving website to be fair. Very nice to be mortgage free too though, and there is a mortgage-free wannabe board on this website IIRC...Feb 2008, 20year lifetime tracker with "Sproggit and Sylvester"... 0.14% + base for 2 years, then 0.99% + base for life of mortgage...base was 5.5% in 2008...but not for long. Credit to my mortgage broker0 -
The costs of accommodation, food, travelling etc etc, i. e the costs associated with going to uni outwith the tuition fees, the maximum student loan does not cover all of this.Steve123456789 wrote: »What costs?0 -
SouthLondonUser wrote: »What do you mean by additional security? Not repaying the mortgage and investing the funds elsewhere may be a bit of a hassle, and of course you need to make sure that tax and mortgage fees do not eat up all the savings from this strategy (many people don't pay taxes on their interest income). But security, what security? As long as you invest in saving accounts backed by the FSCS, and the amounts are < £85k cover, I am not sure what the risks are.
If instead you want to invest in shares or funds, then, sure, there's the risk those investments will yield less than the mortgage rate.
You'd be giving up some flexibility, eg if you take out a fixed-rate mortgage you'd pay a penalty for repaying early, so it would be difficult to, say, move elsewhere after one year, but that's flexibility, not security. Also, tracker mortgages do not typically come with early repayment charges.
Another thing the OP might want to consider is, if he qualifies, an interest-only offset mortgage, like those of First Direct. For example, if I had £100k of savings and a £100k mortgage balance, I wouldn't repay it because I'd want to keep some savings for a rainy day. By offsetting those savings, you'd be paying no mortgage (no interest as the net balance is zero, and no capital as it's interest only), but, at the same time, if you ever need to access those funds (eg the car breaks down) you'd be paying an interest rate that would be higher than the best mortgage but lower than an unsecured loan.
The additional security of owning your whole house. No one can take it away from you. There are no mortgage payments to miss. I'd definitely sacrifice an extra 1% interest to have paid off my entire house.0 -
You can work for yourself, there are still industries that pay good money.
You might end up enjoying working.
I don't think I want to enjoy working though. Sounds weird, but I like that I hate working.
I look around at people who just sit and stare at their screen all day, and are content. I don't want to be content doing that. It's not right. But I'm the strange one, because I want to change.
It makes me appreciate my free time, and know that I want more of it.0 -
Yes I was only thinking of putting the overpayment money to better use with regular savers, easy to have 3 or 4 on the go and that’s maybe all that’s needed, depends on overpayments.
If OP sees this as too much hassle for too little reward that’s fair enough, but this is a money saving website to be fair. Very nice to be mortgage free too though, and there is a mortgage-free wannabe board on this website IIRC...
I'm all up for the hassle of this. Before we bought our house, we had 19 bank accounts between us, and a huge bunch of standing orders throughout the month, moving money around.
e.g we had 3 Nationwide accounts which paid 5% on £2500, but you had to pay £1000 in from another bank's account, so after pay day, £1000 S/O would go to one account, then back to my main current account, then to the next Nationwide, then back etc etc.
Then we'd have various S/Os set up going into savings accounts and other current accounts like above.
We were making about £220 a month in interest.0 -
That's good, what want when you start investing is low prices not high, the lower they stay the better, you have decades to invest over the lower prices are at the start the more you are buying and the more you will eventually get back when the market rises. That is as long as you are investing in index funds, or you know exactly what the actively managed investment is doing so you don't get in a "Woodford situation".Steve123456789 wrote: »I'm investing in a S&S ISA with Vanguard. I started last month and it's lost 2% of its value already..
Then start looking for one you like.Steve123456789 wrote: »The reason I'm considering part time work ASAP is that I hate work more than I can describe with words.0
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