If you cashed your pension in to pay off your bond make sure you replace it over time.

Sego writes: I have R100 000 from my pension fund which I cashed out last year. I am 30 years old and have a retirement annuity which I took out recently. Should I use the R100 000 to pay into my mortgage bond?

Maya replies: It’s a pity that you cashed in your pension fund as you have now paid tax on the amount and you have less money to retire on.

In terms of replacing your retirement funds make sure you increase your monthly retirement funding to 15% of your current income. If you continue to maintain that level you should have sufficient income for retirement at age 65.

If you don’t have any expensive short-term debt then it makes sense to put the money into your mortgage. The key is to continue to repay the same monthly installments that you currently pay – that way you will settle the bond quickly.