Mortgage overpayments or alternative
Discussion
While it’s not risk free I’d say put the overpayment money in a stocks and shares ISA. Mine is returning £6.5% which beats the mortgage interest rate by a fair whack. Then you can choose to pay down your mortgage or keep it ticking over in the ISA. Or increase your salary sacrifice into your pension and get 20-40% free money.
I’ve actually done all three; set my overpayments to finish the mortgage by age 55 while also putting the same amount into the ISA and setting pension contributions to 25%. There’s little point me retiring before 55 as I’ll never afford it and I don’t feel it’s worth paying the mortgage off sooner. Mortgages are cheap money.
I’ve actually done all three; set my overpayments to finish the mortgage by age 55 while also putting the same amount into the ISA and setting pension contributions to 25%. There’s little point me retiring before 55 as I’ll never afford it and I don’t feel it’s worth paying the mortgage off sooner. Mortgages are cheap money.
I do the same as Crumpet - instead of overpaying mortgage (which I used to do), I now put it into a S&S ISA whilst interest rates are so low.
There is no 'correct' answer for this though - it depends how risk averse you are, plus a lot of other factors.
Not sure I would be putting it into Crypto though.....
There is no 'correct' answer for this though - it depends how risk averse you are, plus a lot of other factors.
Not sure I would be putting it into Crypto though.....
Like everything I think the answer is somewhere in the middle. You are already in crypto, so I’m guessing you are a risk taker. Why not split your savings 50:50 (or whatever split you feel comfortable with) and put half in crypto and half into mortgage). There’s nothing saying it needs to be one or the other.
red_slr said:
I assume you are already fully funding your SIPP, ISAS, NS&I and have other diversified investments such as property or REITs or gold?
If the answer to all that is yes then go for crypto, with both feet.
If the answer is no then I think you need to look at another plan.
Personally I’d rather invest in crypto than gold or NS&I (and this is coming from someone who currently has premium bonds, properties and SIPPs). If the answer to all that is yes then go for crypto, with both feet.
If the answer is no then I think you need to look at another plan.
JapanRed said:
Personally I’d rather invest in crypto than gold or NS&I (and this is coming from someone who currently has premium bonds, properties and SIPPs).
Given inflation at the moment (which is way more than they claim), aren’t premium bonds pretty much the worst investment? What’s the return? Half a per cent?JapanRed said:
red_slr said:
I assume you are already fully funding your SIPP, ISAS, NS&I and have other diversified investments such as property or REITs or gold?
If the answer to all that is yes then go for crypto, with both feet.
If the answer is no then I think you need to look at another plan.
Personally I’d rather invest in crypto than gold or NS&I (and this is coming from someone who currently has premium bonds, properties and SIPPs). If the answer to all that is yes then go for crypto, with both feet.
If the answer is no then I think you need to look at another plan.
I'm early 40's and have the following longer term strategy to investing/mortgage etc.
Last year took out a 5 year mortgage for 1.45% roughly. This is ridiculously low it's almost free money in the short term period before its due renewal.
My pension contributions are healthy due to generous contract so I'm only putting in enough for their matching amount. The rest of my savings go on about a 90/10 split on S&S ISA with an aggressive growth strategy and the rest into crypto.
The crypto I have is split between Binance, using 3 commas trading bots to get an average 5-6% returns per month in UDST. And then as I consolidate any ETH or BTC holdings I transfer over to Nexo where it can earn a passive interest itself. Even with the basic Nexo account you earn 4% on ETH or BTC holdings with them.
I understand the risk with the crypto holdings but also, as with any investment, have to accept that it might plunge to zero. I am however holding for the long term as an asset investment view.
Overall I've managed to save about 50% of my remaining mortgage balance in either Stocks and Shares, ISA and crypto and all is earning interest far above what I'm paying on my mortgage. I'm estimating that by the time the mortgage is due for renewal I will evaluate letting it run into SVR and paying off in large chunks or just getting another 5 year deal.
Last year took out a 5 year mortgage for 1.45% roughly. This is ridiculously low it's almost free money in the short term period before its due renewal.
My pension contributions are healthy due to generous contract so I'm only putting in enough for their matching amount. The rest of my savings go on about a 90/10 split on S&S ISA with an aggressive growth strategy and the rest into crypto.
The crypto I have is split between Binance, using 3 commas trading bots to get an average 5-6% returns per month in UDST. And then as I consolidate any ETH or BTC holdings I transfer over to Nexo where it can earn a passive interest itself. Even with the basic Nexo account you earn 4% on ETH or BTC holdings with them.
I understand the risk with the crypto holdings but also, as with any investment, have to accept that it might plunge to zero. I am however holding for the long term as an asset investment view.
Overall I've managed to save about 50% of my remaining mortgage balance in either Stocks and Shares, ISA and crypto and all is earning interest far above what I'm paying on my mortgage. I'm estimating that by the time the mortgage is due for renewal I will evaluate letting it run into SVR and paying off in large chunks or just getting another 5 year deal.
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