This article was published on 11 February 2021. Some information may be out of date.

Is paying down your mortgage still the best strategy?

What to do with extra savings — beyond KiwiSaver minimums etc.

Also lump sums — inheritance, redundancy, win

  • Mortgage used to be the winner — after include tax and fees. Now — with 2–3% loans?
  • Other options: more into KiwiSaver, non-KiwiSaver funds, shares, rental property?
  • The main issue: risk — needs to be high enough risk, long-term. Can you cope with volatility? Are you strong financially?
  • Other issues: security (psychological and financial), simplicity, but diversification, learning about markets
  • Penalties for paying fixed-term mortgage early
  • Conclusion: perhaps do what you want!

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Mary Holm, ONZM, is a freelance journalist, a seminar presenter and a bestselling author on personal finance. She is a director of Financial Services Complaints Ltd (FSCL) and a former director of the Financial Markets Authority. Her opinions are personal, and do not reflect the position of any organisation in which she holds office. Mary’s advice is of a general nature, and she is not responsible for any loss that any reader may suffer from following it. Send questions to [email protected] or click here. Letters should not exceed 200 words. We won’t publish your name. Please provide a (preferably daytime) phone number. Unfortunately, Mary cannot answer all questions, correspond directly with readers, or give financial advice.