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Home » Other » Weekend round-up: Pay down mortgage or invest in the market?

app-based stockbrokers dabbl review the weekend press and provide their take on some of the biggest stories set to impact the self-directed investor. 

The Sunday Times writes on the challenge of whether it’s a good idea to overpay your mortgage – or are you better off investing that money into the stock market?

This is a complex problem and one that is arguably made even more challenging given today’s stratospheric house prices, but it’s certainly worthy of a closer look. The article misses two key points however, investing any surplus into a pension to enjoy tax relief, and the fact that until the 1990s the common way to borrow for a mortgage was by using an endowment. That meant you paid the interest element to the lender, whilst then the capital component was to be repaid with an investment product that built value over 25 years. It’s certainly not cut and dry, but if clearing the mortgage is still some years off, then with interest rates so low the investing argument certainly has merit.

Properly invested?

This might be stating the obvious, but Saturday’s Daily Telegraph covers an article which highlights how fund managers who are invested in the portfolios they manage tend to deliver better returns. Two thirds of managers who had over £1m of their own money in the fund had beaten the returns of rivals over the past five years.

Hydrogen – hope or hype?

With the COP 26 environmental summit looming, there’s no shortage of coverage of how investing in the environment can be good for your wealth. Saturday’s Daily Mail offers up a story on the power of shifting to hydrogen, centred around the fact that a number of trains in the UK have been retrofitted to run on the clean fuel. It wins where batteries simply don’t have the necessary capacity so heavy investment to fund a hydrogen revolution seems like a real possibility – globally, this industry remains in its infancy.

End of the line for savings accounts

At the end of last week, The Independent ran a piece on whether it’s time to ditch the savings account. The article looks at the basics – the importance of having some cash ready for immediate access – but also points out that if you’re not going to need that money for five to ten years, then alternatives such as investing in the stock market should certainly be considered. The slight curve ball here is the fact that we could soon move into an environment where interest rates are rising, something that typically acts as a drag on stocks, but it’s also important to remember that with inflation running above 3%, leaving money sat in a low yielding savings account is damaging your wealth every day.

This article has been published in conjunction with dabbl. dabbl is a simple, intuitive app, designed to make share ownership more accessible than ever before. Connecting consumers with the brands they love, know and trust, dabbl is embracing the growing demand from the next generation of investor to have more control over how their money works for them.

This article is not investment advice. Investors should do their own research or consult a professional advisor.

Tony Cross

Tony Cross

Tony Cross is a market commentator with over 15 years of experience, producing compelling, insightful copy for journalists and investors alike. Focusing on macroeconomics, UK blue chip equities and inter market analysis, Cross's commentary is well regarded for its clarity and ability to cut through the waffle. He has been quoted in publications as diverse as The Financial Times, The Times, The Guardian and The Sun. He has also been a regular guest on both Share Radio and TipTV.

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