Receive a ¥20 million retirement payout with a ¥15 million mortgage balance! My wife says we should pay it off immediately because variable interest rates are rising, but investing the money all at once through the new NISA at an annual return of 5% would be more profitable, right? Estimating the investment gains

The article estimates the respective effects of using a retirement payout to pay off a variable-rate loan or continuing to invest through the new NISA. It assumes a loan balance of ¥15 million, 15 years remaining and equal principal-and-interest repayments.

At interest rates of 1.0%, 2.0% and 3.0%, the monthly payments are approximately ¥89,800, ¥96,500 and ¥103,600, respectively, while total interest over 15 years is approximately ¥1.16 million, ¥2.37 million and ¥3.65 million.

If the funds are invested through the new NISA at an annual return of 5%, approximately ¥5.62 million would remain after 15 years when withdrawals are used to cover repayments at an interest rate of 2.0%. The estimated amounts are approximately ¥7.41 million at 1.0% and ¥3.75 million at 3.0%.

Under the new NISA framework, the ¥1.2 million Accumulation Investment Quota and ¥2.4 million Growth Investment Quota together provide an annual limit of ¥3.6 million. The tax-exempt holding limit is ¥18 million, so investing ¥15 million in one person's NISA account would take at least 5 years.

The article also indicates that a sharp market decline immediately after investing could require assets to be sold and reduce the invested assets, making declines immediately after retirement a risk to watch. It presents a situation in which a combination of repayment and investment, rather than either repaying the entire loan or investing the entire amount, should also be considered.

In conclusion, it is noted that even assuming a 5% annual return produces only a theoretical value and does not take the NISA allowance restrictions into account.