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Savings and investing
Pension, ISA or mortgage
Compare a one-off cash amount put into an ISA, pension or mortgage overpayment under explicit return and tax assumptions.
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Pension versus ISA versus mortgage calculator
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Illustrative ISA value at comparison date
| Cash committed today | £10,000.00 |
|---|---|
| ISA value after entered returns | £16,288.95 |
| Gross pension funded by same net cost | £16,666.67 |
| Pension value before withdrawal tax | £27,148.24 |
| Pension value after assumed withdrawal tax | £23,076.01 |
| Mortgage debt reduction equivalent | £16,470.09 |
One-off scenario, not a recommendation. Mortgage result assumes the debt remains outstanding throughout and payments are unchanged; it is a reduction in debt, not accessible cash. Pension entry relief is an effective assumption you supply, not calculated eligibility. ISA/pension limits, pension access and lump-sum allowance, employer matching, overpayment charges and market risk can change the comparison. Investment returns are uncertain; all values are nominal.
Check the inputs to calculate a result.
Calculation details
Equal cash cost
The ISA uses the cash amount directly. Pension gross funding is cash cost divided by one minus the assumed effective tax relief. Both grow at the entered investment return. Pension withdrawal tax applies after the entered tax-free share and remaining lump-sum allowance.
Mortgage comparison
The mortgage figure is the debt reduction equivalent after monthly interest at the entered rate, assuming the debt remains outstanding and payments stay unchanged. It is not accessible cash. For actual payoff dates, use the mortgage overpayment calculator.
Limits
One tax year of new money, capped at the £20,000 ISA limit and £60,000 gross pension model cap. No eligibility assessment, employer matching, other subscriptions, overpayment penalties or future law changes. Pension access restrictions, uncertain investment returns and remaining mortgage term can dominate the decision. There is no universal winner.
Sources
- Investment risk and capacity for loss in retirement
- Pension withdrawal taxation and lump-sum allowance
- Normal minimum pension age and 2028 increase
- 2026/27 adult ISA subscription allowance and Lifetime ISA sublimit
- Net pay and relief-at-source treatment, 20% provider relief and additional relief limited to higher-taxed income
- Pension salary sacrifice reduces cash pay and NI earnings; minimum-wage restriction
- Gross relief-at-source contributions reduce adjusted net income
- Standard annual allowance includes employer contributions; taper/MPAA may apply
- Section 10(6): relief-at-source extension of basic and higher-rate limits under Finance Act 2004 s192(4)
- Income multiples are approximate; lenders assess income and expenses
- Lender affordability checks and application factors
- Mortgage interest rate options and changing repayments
Checked 2026-10-25. Estimate only, not financial advice.