Low interest rates = Paying the mortgage with the savings?
With the basic rate of UK now at 1.5% checked my Halifax Isa and is gaining %!!!! wopping 0.10 wow. While holding an emergency cash fund must now be sticking my savings to pay my mortgage which is currently at 5% because they are clealy not going to win more than that in a bank?
Interest rates on loans and mortgages are almost always higher than even the best rates available in the savings. Thus, in general, you are always better in the long term by paying the debts instead of having savings and debts. If you are a taxpayer you actually get greater savings, including due to tax interest earned on the savings. But where the payment of debts that receives the benefit "complete" in the interest rate. However, as you say, it helps save some aside for emergencies. Suddenly you may have to pay if the car engine blows up or the boiler is broken down. If you did not have savings that could end up putting these costs on a credit card and paying 25% interest! If you have an emergency fund sensible put the rest on your mortgage. Although check whether you have a limit to the additional amount you can afford – some do. The best of both worlds is to offset their savings in against your mortgage. You save a file that you must use if you need. But while on the bench, instead of earning interest that is deducted from the amount your outstanding mortgage. You pay less interest, so you get the same benefits as if actually paid that amount. Quite a mortgage offer this service for may be worth checking.
UK Mortgage Crisis
