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lullabella
LIF Adult
Member since 5/05 2246 total posts
Name:
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Pay off mortgage or invest?
Is it better to pay off your mortgage (interest rate is 4.875%) or invest the cash? People I have spoken to have very different view points but I was wondering from a "financial" one which makes sense. My husband likes the "piece of mind" not having a mortgage but I dont think that is smart if it doesnt make sense financially.
BTW this is just a hypothetical question!!!
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Posted 3/23/10 9:12 AM  |
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Nifheim
allo
Member since 1/09 5476 total posts
Name:
Jennifer
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Re: Pay off mortgage or invest?
if it was me i would pay off mortgage but i am not a savy financial person. I just would want one less bill.
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| Posted 3/23/10 9:14 AM |
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lbelle821
Arghhhhh
Member since 2/06 5285 total posts
Name:
Lisa
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Re: Pay off mortgage or invest?
invest the cash...if done well you would earn more than 4.875% return.
Plus your mortgage interest is a tax deduction.
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| Posted 3/23/10 9:20 AM |
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deedee1013
LIF Adolescent
Member since 11/07 616 total posts
Name:
Diane
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Re: Pay off mortgage or invest?
Posted by lullabella
Is it better to pay off your mortgage (interest rate is 4.875%) or invest the cash? People I have spoken to have very different view points but I was wondering from a "financial" one which makes sense. My husband likes the "piece of mind" not having a mortgage but I dont think that is smart if it doesnt make sense financially.
BTW this is just a hypothetical question!!!
I am NOT a financial person...
Mortgage interest that you pay can be included on your tax form as money paid.
Interest on investments (I think) are included on your tax form as income.
Perhaps a CPA would know best...
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| Posted 3/23/10 9:21 AM |
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Salason
♥
Member since 6/05 9878 total posts
Name:
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Re: Pay off mortgage or invest?
Posted by lbelle821
invest the cash...if done well you would earn more than 4.875% return.
Plus your mortgage interest is a tax deduction.
I agree. Actually the NYT had a great article on this last week!
When Not to Pay Down a Mortgage
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| Posted 3/23/10 9:23 AM |
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GioiaMia
Let's Go Rangers!
Member since 1/07 14818 total posts
Name:
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Re: Pay off mortgage or invest?
Posted by Nifheim
if it was me i would pay off mortgage but i am not a savy financial person. I just would want one less bill.
i feel the same way! but i know it is the "wrong" answer LOL
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| Posted 3/23/10 9:25 AM |
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Re: Pay off mortgage or invest?
Posted by Tilde
Posted by Nifheim
if it was me i would pay off mortgage but i am not a savy financial person. I just would want one less bill.
i feel the same way! but i know it is the "wrong" answer LOL
Same here. I would do this and after two or three years of saving that money invest and just keep investing!!!
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| Posted 3/23/10 10:05 AM |
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eddiesmommy
best buds!
Member since 5/09 11524 total posts
Name:
Melissa
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Re: Pay off mortgage or invest?
Posted by Tilde
Posted by Nifheim
if it was me i would pay off mortgage but i am not a savy financial person. I just would want one less bill.
i feel the same way! but i know it is the "wrong" answer LOL
Me too, it would free up so much money and in theory I could invest that instead.
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| Posted 3/23/10 10:09 AM |
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robynfs
12/6/10!!
Member since 9/05 4947 total posts
Name:
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Re: Pay off mortgage or invest?
We were just in this situation in January. My DH got his end of year bonus and wanted to pay off the mortgage on a condo we own. We figured the interest was about 6% and that investing would likely not give us that return. So we paid the mortgage off!
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| Posted 3/23/10 10:14 AM |
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Blu-ize
Plan B is Now Plan A
Member since 7/05 32475 total posts
Name:
Susan
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Re: Pay off mortgage or invest?
Most of the time paying off debt of any kind is the best choice.
All of that money can be put towards investments.
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| Posted 3/23/10 10:41 AM |
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CrankyPants
I'm cranky
Member since 7/06 18178 total posts
Name:
Mama Cranky
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Re: Pay off mortgage or invest?
Paying off the mortgage is a sure thing-investing is not. So, I would pay down the mortgage.
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| Posted 3/23/10 10:46 AM |
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lullabella
LIF Adult
Member since 5/05 2246 total posts
Name:
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Re: Pay off mortgage or invest?
Great insight! I have been doing some readying and I think I am leaning towards pay down the mortgage as long as you have some liquid savings.
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| Posted 3/23/10 10:47 AM |
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neener1211
:-)
Member since 4/07 22952 total posts
Name:
J
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Re: Pay off mortgage or invest?
To me it would depend on how much money I had to pay off the mortgage with or invest. If we're talking 100k, I'd put enough into savings to cover me if anything happened, and the rest would pay off some of my mortgage.
If it were more like 20k, i'd be more inclined to just save that money in the bank.
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| Posted 3/23/10 10:56 AM |
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Mommy2Boys
My Boys!!!!
Member since 6/06 14437 total posts
Name:
C
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Re: Pay off mortgage or invest?
Posted by Blu-ize
Most of the time paying off debt of any kind is the best choice.
All of that money can be put towards investments.
I agree with this! The mortgage interest you are going to claim on your taxes and "get back" will be nothing compared to if you invest your monthly mortgage payment.
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| Posted 3/23/10 11:36 AM |
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Cheeks24
Living a dream
Member since 1/08 8589 total posts
Name:
Cheeks
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Re: Pay off mortgage or invest?
Definitely pay off my mortgage and invest my monthly mortgage "payments".
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| Posted 3/23/10 12:28 PM |
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