Build savings or chip away at mortgage

[Troll]

Surely as a contractor that doesn't make total sense, you have to retain savings - one wouldn't stick their warchest as an overpayment (unless you can DEFINITELY get it back out). Or were you specifically meaning long-term savings i.e. not including the warchest?

I keep x amount in the company accounts for rainy days, I also have y amount in the company accounts to cover tax liabilities which leaves z as play money - if I was just starting out with big mortgage and young family then I would pile everything from the play money into paying off the mortgage, now I'm older and without a mortgage & the kids largely off my hands I can and (am doing) building up a nest egg for retirement,.
But those wizzy offset mortgage thingy's weren't around when I were a lad but they do look an interesting solution - especially if you can find a cunning way of getting all that lucre in your company account as an offset

But youz pays yer money and literally takes yer choice as to which is the right balance for your particular circumstances - but you have no idea how nice it feels when that property is yours and not the banks

[aussielong]

In general pay off mortgage would be my advice.
But get an offset mortgage so essentially you are doing this automatically.
And keep putting an amount away in a warchest.

This is lower middle class thinking. Paying off the mortgage.

In a low interest rate environment you should take on more debt.

So it depends on the interest rates you have access to. If you have a very low rate, I would extend the loan and renovate the property.

Keep your warchest to a minimum since the interest on that money is low.

[AtW]

We've just bought a new house after renting previously, and chose to take a bigger loan (85%) in order to keep a sensible warchest intact (about a year).

Choose Life. Choose a job. Choose a career. Choose a family. Choose a ******* big television, choose washing machines, cars, compact disc players and electrical tin openers. Choose good health, low cholesterol, and dental insurance. Choose fixed interest mortgage repayments. Choose a starter home. Choose your friends. Choose leisurewear and matching luggage. Choose a three-piece suit on hire purchase in a range of ******* fabrics. Choose DIY and wondering who the **** you are on Sunday morning. Choose sitting on that couch watching mind-numbing, spirit-crushing game shows, stuffing ******* junk food into your mouth. Choose rotting away at the end of it all, pissing your last in a miserable home, nothing more than an embarrassment to the selfish, ****ed up brats you spawned to replace yourselves. Choose your future. Choose life... But why would I want to do a thing like that? I chose not to choose life. I chose somethin' else. And the reasons? There are no reasons. Who needs reasons when you've got heroin?

HTH

[Wanderer]

would you continue to build savings or would you maintain the warchest and pay every spare pound into the mortgage since every pound you overpay early on could save you £2 in interest?

Pay off the mortgage. I can't see the point in putting your money in a savings account so your bank can lend it back to you and charge you interest on it.

If your mortgage is 4% and you overpay it, the effective return on your savings is 4% net of tax which is 6.7% gross if you are a 40% tax payer or on the 40% limit. No other investment is going to give a risk free return like that and if you get a fully flexible mortgage then you have instant access to your savings too.

If you have a lot of money retained in your company then you can also take a director's loan and pay the mortgage down with that too but get professional advice first because it's a bit complex.

[cojak]

Build savings or chip away at mortgage

Pay off the mortgage, then concentrate on retirement (using any method you choose).

I want a life after I finish work.

[norrahe]

Pay off the mortgage, then concentrate on retirement (using any method you choose).

I want a life after I finish work.

Same here.

Might do that on the UK house, then the rent on the UK house will almost pay the cloggy mortgage ( if we ever buy anything).

[Troll]

In a low interest rate environment you should take on more debt.

Big mistake.. increasing debt can multiply your gains but the bit often forgotten about is it can also do the same on your losses when the tide turns

[Troll]

Choose Life. Choose a job. Choose a career. Choose a family. Choose a ******* big television, choose washing machines, cars, compact disc players and electrical tin openers. Choose good health, low cholesterol, and dental insurance. Choose fixed interest mortgage repayments. Choose a starter home. Choose your friends. Choose leisurewear and matching luggage. Choose a three-piece suit on hire purchase in a range of ******* fabrics. Choose DIY and wondering who the **** you are on Sunday morning. Choose sitting on that couch watching mind-numbing, spirit-crushing game shows, stuffing ******* junk food into your mouth. Choose rotting away at the end of it all, pissing your last in a miserable home, nothing more than an embarrassment to the selfish, ****ed up brats you spawned to replace yourselves. Choose your future. Choose life... But why would I want to do a thing like that? I chose not to choose life. I chose somethin' else. And the reasons? There are no reasons. Who needs reasons when you've got heroin?

HTH

were you p*ssed when you wrote that?

[sasguru]

This is lower middle class thinking. Paying off the mortgage.

In a low interest rate environment you should take on more debt.

So it depends on the interest rates you have access to. If you have a very low rate, I would extend the loan and renovate the property.

Keep your warchest to a minimum since the interest on that money is low.

Your non-middle class thinking is the reason why you're the only Ozzie I know who hasn't retired on the proceeds of London property.

[doodab]

Choose Life. Choose a job. Choose a career. Choose a family. Choose a ******* big television, choose washing machines, cars, compact disc players and electrical tin openers. Choose good health, low cholesterol, and dental insurance. Choose fixed interest mortgage repayments. Choose a starter home. Choose your friends. Choose leisurewear and matching luggage. Choose a three-piece suit on hire purchase in a range of ******* fabrics. Choose DIY and wondering who the **** you are on Sunday morning. Choose sitting on that couch watching mind-numbing, spirit-crushing game shows, stuffing ******* junk food into your mouth. Choose rotting away at the end of it all, pissing your last in a miserable home, nothing more than an embarrassment to the selfish, ****ed up brats you spawned to replace yourselves. Choose your future. Choose life... But why would I want to do a thing like that? I chose not to choose life. I chose somethin' else. And the reasons? There are no reasons. Who needs reasons when you've got heroin?

HTH

still renting then?