Savings, mortgage, investments

[littlematchstickgirl]

Looking for some advice please.

2 years left on fixed rate mortgage. Sub 1.5% interest rate. Then will have to remortgage remaining amount - about £130k.

£50k savings, in a cash ISA and cash. Plan is to use a lump of it to reduce outstanding mortgage when I need to remortgage, while leaving some for emergency fund.

Is that sensible or should I be investing some in S&S ISA? Obviously it should be kept there for longer than 2 years, so I'd have to remortgage full outstanding balance.

Not sure what is best to do - all advice welcome. Thank you!

I think this depends on your appetite for risk. But say you move the whole amount into stocks and get a 10pc total return you’re only talking about 55k. On the other hand you could lose 10pc and have 45k. Either way we are not talking about a significant change.

However.. it might really annoy you to lose the 5k!

Can you regrow another chunk of savings over the remaining 2 years? In which case you could invest and leave the current £50k. At least get the cash outside an ISA doing something more useful. You might get a 2yr bond or similar which will mature as you need it. I’d not invest over such a short time frame.

I like Dave Ramsey's way of turning it around to look at it...

Imagine you had a mortgage of £85K, and had £5K in emergency fund savings.
Would you borrow an extra £45K on your mortgage to invest in the stock market? (It's essentially the same financial risk).