£25,000

[Skyedriver]

What would you do

You are 60
You get let's day £25,000

Do you
Have a holiday
Put into a pension plan
pay off the Mortgage
Put towards a different house (bigger garage)
Invest in a fund for 5 year return
Buy a decent classic car, you can use and sell for (hopefully) at a profit.
Wine women and song and waste the rest.

Discuss

[BoRED S2upid]

Pay off the mortgage.

[PistonSmegs]

BoRED S2upid said:

Pay off the mortgage.

+1 - Yup, me too.

[bogie]

lose the mortgage and give up work sooner

no point in being a rich 70 year old and dropping dead the next year ...seen too many go in recent years, I want to be getting some money out of that pension pot at 55 ...

[P-Jay]

Mortgage, that close to retirement you've got to be focused on reducing over-head for the long run as very few people retire on more income than they had working.

[FiF]

Classic order of doing this.

Pay off debt as this typically costs more than mortgage.
Then pay off mortgage.

Then get to a position where there is a rainy day nest egg tax free so that in the event of needing a new boiler / engine / gearbox say you don't have to borrow.

Then what happens if income stops? Opinions vary as to how many months of income you need stashed away not necessarily with instant access but can be got at just in case.

Then and only then are there the options about a weekend toy flash holidays what have you.

Boring answer I'm afraid but that is the classic answer for the prudent.

[Kenzle]

Depends if you want to leave inheritance to loved ones / children etc.

Some might say that there is a strong argument for increasing your debt / mortgage against your assets the closer you get to the pearly gates.

There is little point in paying off your mortgage and having say a £500,000 house (illiquid asset) when you are on your death bed. You might find yourself wishing you had taken out a £200,000 loan against it and bought a McLaren MP4-12C the year before (for example )

ETA: Having re-read this I realise it maybe sounds a little morbid - don't mean to imply you are nearing the pearly gates OP! Just wanted to illustrate that the consensus wisdom to pay off all debts etc isn't necessarily the path to greatest fun / happiness.

Edited by Kenzle on Thursday 2nd May 19:01

[ringram]

If you are still earning then dump it into a pension and wipe out a lot of tax.
Plus side is also that you can pull 25% back out tax free and trickle the rest down over time.

But depends on your circumstances. Mortgage is cheap debt, so paying it off may not be the best plan.

[Skyedriver]

ringram said:

If you are still earning then dump it into a pension and wipe out a lot of tax.
Plus side is also that you can pull 25% back out tax free and trickle the rest down over time.

But depends on your circumstances. Mortgage is cheap debt, so paying it off may not be the best plan.

If the person was still working, (and would need to until 70 to pay off the Mortgage)
and had received the afore mentioned sum as a tax free pension lump sum?

Didn't want to spend his retirement driving a boring car and fancied getting back into club competitions.

You get the 20% tax relief on pension contributions but pay PAYE tax on the payouts later so cannot see the benefits.

There are investment plans out there that claim better returns than 5% pa but guess these are subjext to a bit of risk.

The person doesn't think of himself as 60 but knows the squeak of those pearly gates having seen friends pass through them in their 50's and 60's.