I have inherited an amount of money. I also owe approximately the same amount on my house.
Should I pay this into my home loan (which I have at prime -2%) and basically settle the loan or should I invest this money elsewhere?
If I invest, what type of investments? I am 60 and retired. My husband still has a few years left to work.
Daryl Ducasse of Merkurius Capital Solutions, responds:
Firstly, this response should not be deemed to constitute investment advice in any manner whatsoever. If you have a personal financial advisor you should consult him.
Secondly, A more accurate understanding needs to be gained regarding income, income stability and other assets before any absolute response can be given.
That is because these factors will allow us to determine risk and affordability.
Getting rid of debt is always a good thing, particularly when approaching retirement age.
If you look at it from another angle, you will be "paying yourselves" the interest component earned by the bank on your bond instalment. So it’s not altogether a bad strategy.
The upside is that the home will always be yours unless encumbered down the line.
The downside is that you may not have an income-generating investment to supplement your needs through your retirement stage.
This is why we would want to have more information first.
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