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Mortgage Repayment

Paying off a mortgage

Tax efficient investments

You may want to consider using an independent savings account to help pay off your mortgage. You do not have to pay income or capital gains tax on an ISA and thus your money can be worth a lot more. Most ISAs will require that you get a separate life assurance policy. The benefits to an ISA are that they are tax-efficient, have a great potential for growth, can have funds withdrawn from them at any time and there are a really wide range of ISAs that you can choose from. The main disadvantages of an ISA are that the amount of money that you invest has the potential to decrease as well as increase and, as with an endowment policy, you may be faced with a shortfall when it is time to repay your mortgage.

Pensions

Another way that you can repay your mortgage is through the tax free money you have saved through a pension. Pensions offer a very efficient way to save. If you do decide to use your pension fund, you will have to bear in mind that it will reduce the amount of money that you can expect to receive from your pension after you have taken the money out. You also cannot take any of the money out of your pension until you get to retirement age, so if your mortgage ends before this time, you will be unable to use your pension to repay it.

Other options

You can use money from any other investments, savings or inheritance that you have built up during your lifetime. However, you must make sure that you have enough money available to pay off your mortgage when it is due.

Click here for mortgage advice

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