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invest or put off mortgage ?

  • 10-11-2009 4:46pm
    #1
    riffraff2009
    Registered Users, Registered Users 2 Posts: 20 ✭


    i have apx 120k left owing on my mortgage , and have almost 40k savings . should i pay it off mortgage or are there any better investment options ? i have a decent , secure job and pension , and am 35 years old with wife and 2 kids . no other loans


Comments

  • #2
    pocketdooz
    Registered Users, Registered Users 2 Posts: 1,559 ✭✭✭pocketdooz


    riffraff2009 wrote: »
    i have apx 120k left owing on my mortgage , and have almost 40k savings . should i pay it off mortgage or are there any better investment options ? i have a decent , secure job and pension , and am 35 years old with wife and 2 kids . no other loans

    Probably not what you want to hear but you should speak to a qualifed financial advisor. This is not the place for decisions of such magnitude.

    (imo)

    .


  • #3
    riffraff2009
    Registered Users, Registered Users 2 Posts: 20 ✭riffraff2009


    just advice or ideas . maybe i'm paranoid but a financial advisor will try to sell me something that they can get commission on ??


  • #4
    soddy1979
    Registered Users, Registered Users 2 Posts: 284 ✭✭soddy1979


    Well I always like to have 6 months net salary in savings on hand just in case I need it. On hand I mean a bank account balance I can easily access, or some fixed return account I can withdraw from if necessary. But do talk to an advisor, and if necessary talk to a few of them.


  • #5
    Lexus1976
    Closed Accounts Posts: 702 ✭✭✭Lexus1976


    I would presonally pay off as much of the mortgage as possible. But this really depends on the type of mortgage loan you have tracker, fixed, variable etc....

    If you have a tracker mortgage. Leave it as it is.
    If you have a variable rate mortgage, consider paying off as much as you can afford and go shopping for a competitive fixed rate mortgage.
    If you have a fixed rate mortgage, you will not be able to through in a lump sum unless you consider switching mortgage provider. If you decide to switch mortgage provider you will be charged for breaking the fixed rate term.

    You should always keep at least 3 months salary in a demand deposit account for emergencies.

    The above is only my opinion! There is no harm in asking for advice on a website. But you will need to do your own research. If you are dealing with a financial advisor ask them up front how much commission they are making, and ask them for a reasons why letter. ie a letter stating why the broker chose a financial product over another financial product.


  • #6
    lucky-colm
    Closed Accounts Posts: 798 ✭✭✭lucky-colm


    i think you are sitting pretty riffraff

    by a secure and pesionable job i assume you are in the public sector somewhere. if you are 100% gauranteed of your job for the duration of your mortgage and your kids rearing and schooling (which really is a long way down the road) well then maybe a bit of investing would be allright.

    but i would suggest leaving the lump sum of 40k where it is hopefully you have this making a nice return in a bank account for you i think anglo are doing 3.8% at the moment.

    then start investing a few quid that is left over from your salary(surplus to requirement)each month and build up a portfolio that way.

    at least all your savings wouldn't be exposed and god forbid if some emergency did arise you still have your lump sum stashed in a cosy account somewhere:D


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  • #7
    Raskolnikov
    Registered Users, Registered Users 2 Posts: 10,148 ✭✭✭✭Raskolnikov


    pocketdooz wrote: »
    Probably not what you want to hear but you should speak to a qualifed financial advisor.
    Waste of money in this situation. You'll be charged several hundred Euro for information you can get yourself for nothing.

    The first thing you need to do is find out whether you're even allowed to overpay on your mortgage. Talk to your lender to establish this.

    Secondly, you need to look at the difference between your mortgage rate and savings rate. If your savings rate is better than your mortgage rate (taking into account 25% DIRT on savings), it's a no-brainer to leave your money in the savings account.

    Otherwise, for 95% of people, the best option is to simply pay down your mortgage. You won't lose money and you'll end up saving a little over the course of your mortgage. If you really want to dip your toes into the stock market, then I would use €30,000 to pay the mortgage and use €10,000 to buy stocks. Do your own research, come back and ask for opinions here if you like. If one of your ideas is AIB though, the best thing you could do is to use that €10k to pay your mortgage!


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