To not want to pay off my mortgage?

It is vital OP has an emergency fund. But aside from that, this is as much of a discussion as to how much control of her own life is OP willing to sacrifice for financial benefit. Believe me, there aren't too many more financially literate than me.

I guess the other question is whether the 50k you have is all your savings? Do you have any other emergency cash? Do you have financial protection in place were you to suddenly both lose your jobs? Are you saving a decent amount each month? Yes technically you would have money in the house but it’s not really accessible if you had an immediate need.

I think you should pay off your mortgage. You are committed to the mortgage - even if you move- so you might as well get it paid off sooner - look at how mortgage rates have gone up in recent years - paying the mortgage off will give you security against that.

i get that you don’t want to be beholden to MIL, but relationships can change - your relationship might improve or it might worsen regardless of whether you accept this financial gift, so you might as well take it.

• our house is old so don't really want to "invest" in it - we might move

this makes no sense, you’ll have to pay it anyway. Whether you pay it now or when you sell makes no difference.

• it reassures me to know this nest egg is available for emergency medical or other expenses

what country are you in that you might need “emergency medical expenses”?

• we'll be better off each month but only by the amount of the mortgage payment

the only reason not to pay the mortgage off is if the interest on your nest egg is higher than the interest on your mortgage.

Then you’ll have extra money every month to pay for your safari. Quite honestly the level of financial illiteracy that values a fortnight’s holiday over owning a house outright is mind blowing.

@godmum56 if her estate exceeds the IHT threshold, with non-exempt gift element added, there will be IHT to pay on her estate. Indirectly, I suppose the OP is affected assuming she's a beneficiary, but no one will come after that £50k gift, only the MIL estate in excess of the threshold.

umm I take your point about the tax issue being for Mil to deal with but what if she doesn't?

Have you looked at OPs second comment on the thread? The gift comes with 'strings' that include, but are not limited to financial decisions being taken out of her hands, that may lead to financial determent.

Beside that, the Inheritance Tax issue would be for MIL to take care of and wouldn't be levied against OP. Annual exemptions and gift allowances is beyond the scope of the OP and not what she needs guidance on.

And while I agree that being free from debt upon repaying the mortgage must be (yet to experience it for myself) incredibly liberating, my guess is that it would quickly evaporate once the realisation hit that I had no savings to replace my boiler that just failed in the middle of a cold snap!

I think it would be foolhardy NOT to pay off the mortgage. You say that you might not always want to live in your present home, but being mortgage free in this one would put you in a much stronger position when you put in an offer on another house as you will be cash buyers. There is a lot of talk of interest rates going up imminently, so you will be paying back a lot more on your current mortgage if you don't accept this offer, which is why, l suspect, your MIL has made it. What a very kind and generous person she is. Please don't look this gift horse in the mouth.

Well how much would a safari cost? With no mortgage payments how long would that take you to save up?
Or put Mil £50k in and £40k of the nest egg, she doesn't need to know

Pay off the mortgage and invest what would have been the repayment. Why give a lender a load of interest when you can accrue some of your own.

Going mortgage free is one of life's great pleasures.

Presumably you would have to pay tax on the £50k your are gifted.

I wouldn't accept this 'gift'. No way. Do they expect to move in at some point?

yeah, I kind of thought this might be the issue. Don't do it OP.

Apologies if I missed it, but I didn't catch OPs age. Pensions cannot be accessed until age 55, so the money cannot be accessed should an unexpected expenditure requirement arise if OP is below that age. I am certainly an advocate of pension contributions, but only once an adequate emergency fund is in place.

I would happily take the 50k to pay off mortgage but not if she insists you use your own £50k too- you may well want to keep that for other stuff life throws at you. It's your to your H to communicate that- if it comes with strings then no I wouldn't take it

You shouldn't feel spoilt and ridiculous. Your opinion and agency is just as important as your DH.

Like I suggested earlier, talk to MIL. Explain how grateful you are for the proposed gift, and also explain how you intend to retain your savings to cover unexpected expenses. Her response is a window into her soul. If she is truly benevolent, she will respect this even if she disagrees. If she withholds the gift unless her conditions are met, well, I'd tell her thanks but no thanks.

You are your own woman, and no one owns you.

You'd be utterly crazy to accept a £50k gift that comes with the stipulation that you sink all of your savings into your mortgage along with it.

What happens if they do that and one of them loses their job, or they need expensive house or car repairs?

This is a good idea.

Also, I read your username as TomSelleckHasKidneys 😁

Subject what happens in budget there's a half way house on this- you could delay the mortgage payment and each pay £50 k to your pensions that would give you 20% back after you submit your tax return or 40% if you are higher rate payers. You could then invest the £20k or £40 k tax rebate into your mortgage reducing it while the pension also accumulates over the years. I transferred a pension just over a year ago which has already gone up 11% - imagine what your pension would look like after say 30 years with a £100k boost now.

You’d be utterly crazy to turn away a £50k gift that will leave you mortgage free.

If you understand compound interest you’d understand that’s more like a £70k gift. £100k mortage over 10 years will cost you about £20k in interest.

Pay off the mortgage and start resaving the nest egg. You’ll be approx £70k better off for it long term.

Why don’t you do 25000 on your mortgage and ask if you MIL would match that instead?

@Everanewbie why no affiliation to St James Place, out of interest? I'm looking for a FA so I'm curious.

I would encourage you to speak to a Chartered firm with no affiliation to St James Place, and sincerely hope your perception is changed, for your own benefit, and that of my industry.

There are a number of advantages that pensions provide that people may not necessarily be aware of, income tax relief relief on contributions, employer contributions, a virtually tax free growth environment, and (pre-budget!) an efficient way to pass money to your beneficiaries. So a good adviser will talk about pensions, and I'd encourage you to listen.

But, a good adviser will also look holistically, and use pensions as tool in their kit bag should it be appropriate.