Pay down the mortgage or invest?

How we calculate

There is no single right answer: it depends on the rate, the return you believe in and how much of a buffer you want within reach. Extra amortisation earns a safe return equal to the mortgage rate after the interest deduction. Investing can earn more over time, but the value swings, and the money stays liquid for the day the roof leaks or a job disappears.

The 70 and 50 per cent thresholds

The amortisation requirement follows your loan-to-value: above 70 per cent you amortise at least 2 per cent of the loan a year, between 50 and 70 per cent at least 1 per cent, and below 50 per cent nothing. Paying past a threshold lowers the mandatory monthly amount, and the calculator shows it.

Money in the walls stays in the walls

A heavily amortised home with an empty buffer is a fragile position: the wealth exists, but you cannot use it without borrowing it back or selling. Many households do best with a mix, for example a buffer of a few months of costs first and amortisation after that. That is why the calculator shows the half-and-half path.