So my situation is (circa)
Mortgage 100k
Savings 100k
Current payments 10k p.a.with 15 years left. Apartment is let out.
Gains
10k - 800 x 12
Losses
2.0k - 2% interest
1.6k - 75% of 3k @ 52% (tax liability on rental)
Net Gain
6.4k
Some points:
The question:
I like the idea of having ready cash and no doubt as long as nothing changes dramatically in the near future I could have a nest egg growing quickly within a few years. I am private sector but in a good field and no dependents as yet. So does the gain of paying off the mortgage wiin hands down given the poor return on savings ? Another factor would be the safety of deposits ? Is there something I am missing above which could increase the pros or cons ?
Mortgage 100k
Savings 100k
Current payments 10k p.a.with 15 years left. Apartment is let out.
Gains
10k - 800 x 12
Losses
2.0k - 2% interest
1.6k - 75% of 3k @ 52% (tax liability on rental)
Net Gain
6.4k
Some points:
- AVR is currently 4%
- Tax liability would decrease over time so the gain would grow
- The rental received is not relevant as the liability is the only thing I can decrease
- Apartment is in about 25k N.E.
The question:
I like the idea of having ready cash and no doubt as long as nothing changes dramatically in the near future I could have a nest egg growing quickly within a few years. I am private sector but in a good field and no dependents as yet. So does the gain of paying off the mortgage wiin hands down given the poor return on savings ? Another factor would be the safety of deposits ? Is there something I am missing above which could increase the pros or cons ?