Lump Sum! Pay off mortgage or high interest account.

[SuperSel]

When I leave the army I have a couple of choices regarding the amount of lump sum I could recieve. One of around �42k or one of �28k. The higher yields a lower monthly pension and visa versa with the lower option. I currently have a mortgage of �44k over 21 yrs to pay. Should I clear a chunk of my mortgage and finish it early (take out an offset account), or invest in a high interest account. If I take the �40k package I would consider utilising �30k and �20k if I took the lower package. A bit confusing but thanks in advance.

[hydrogoose]

Hi,

I suggest you compare like for like.

Your 21 year mortgage will need to be paid for as long as you have the house, typically 21 years ( as you mentioned)

If you put any money in a high interest account, you would have to leave it there for 21 years to be able to make a comparison of the investments.

In your position , I would most definately pay off the mortgage and use whatever I currently pay every month towards an investment fund/ high interest account.

cheers