Good reasons to pay off your mortgage: |
|---|
| • You plan to live in your home for the rest of your life. |
| • If it’s not paid off, you’ll worry about it. |
| • The mortgage will be a big drag on your cash flow in retirement. |
| • Payoff is only a few years away, and your mortgage interest deduction is minimal. |
| • You want a debt-free retirement. |
Good reasons to put the money toward your retirement savings instead: |
| • You plan to move, retire, or both soon. |
| • You have the discipline to save and invest the money. |
| • You’re not maxing out your tax-deferred retirement accounts. |
| • You’re confident your investment return will be more than your after-tax cost of paying extra on the mortgage |
Prepay the Mortgage or Save for Retirement?
By Ellen Hoffman
Paying down a mortgage is often said to be the same as stashing away dollars, and accelerating payments may seem like a wise thing to do—especially if you want to start your retirement debt-free. But you might be able to do better by investing the money that would otherwise go toward those extra mortgage payments. Here are some things to consider when deciding which course to follow.
Read: Pay Off the House? Not So Fast
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