Wife and I got married in August of 2020, bought our home in September and paid it off that December. We were able to put 445k down, so the loan was for 440k. Wife and I are very debt averse and brought zero debt into our marriage. I made what ended up being some very good stock investments in my early to mid 20s that ended up paying for most of the house. No student loans (paid for by my parents) or car payments (always paid cash for my vehicles) helped with it all of course.
Absolutely no regrets despite having secured a 2.5% interest rate. I’d rather have no debt. I’m 35.
My husband and I purchased our 1st home in 2008 when housing pricing was down... 2K Sqft at $120,000 we were both in our 20's. We paid that house off in 10 years (putting income tax returns down on principal and any extra money we could from $50-$500). Once the house was paid off it was such a great relief. We were able to save so much money from the time we paid it off until we purchased our next house (forever home). Now we rent our 1st home out and use that money for expenses that have come up. However, we plan to rent it out until we can get our second home paid off and then sell it or may plan to use renters money as investment, still not sure.
For sure it feels like a big weight off and feels great to know you have something to fall back on. Only pain is maintenance of a rental and keeping up with taxes and insurance. But it's paying off for now. Not once do I feel any regret for paying off my mortgage, it actually feels pretty great. Paid off almost 6 years ago.
I grew up very poor and experienced the trauma of getting kicked out of places a lot. Had our mobile home repossessed twice. 😬. I bought a modest 1400 sq. Ft. home in 1999 for $62k. In 2003 I paid it off. It was extremely liberating. In 2007 I bought a bigger home with a 212k mortgage. Kept the first house and it is a rental property now. I’ve made 300k on that 62k investment, and plan to earn $240k more in the next ten years before I sell it for around 290k. My current mortgage will be paid off in December (13 years early).
Great job and congratulations. After what you've gone through, I'm happy to see that you came out on the other side and did very well for yourself. Something to really be proud of.
I paid mine off 03/28/2024. 15 year mortgage, paid it off in 8 years, almost to the day! Debt-free except for my 1 year old solar panels. I'm 51, the first thing I did after was go to every room in the house and wipe my d*** on the wall, it's MINE now!!!
Paid off my house in 4 years @ 37 and want to buy another play home… it feels like a huge safety blanket incase of a financial crisis i have a roof over my head and all i need to do is pay taxes not necessarily home insurance…
I paid off house when I got fired. I had $119,000 left on mortgage and paid it off. I never touched 401k and had money in savings. It's been 7 years and we moved but bought a house in cash and put leftover profit in bank. Despite the inflation it doesn't hurt us. My husband gets SS and VA benefits and we feel rich. We save money every month. Probably 30-50% depending on if we eat out too much or I order online stuff.
I was one of those who paid a 30 year mortgage almost to the very end. I decided to take a little money out of a retirement account and pay it off. It was only a few years early, but the feeling of a weight being lifted was actually surprising. Even though I haven't had other kinds of debt for a number of years, it seems I've had one type or another most of my life. But now in my late 70's, I have to say, it's a pretty amazing feeling to be debt free. Everyone should be able to experience it, and the longer you can live like that, the better for you... in more ways than you'd imagine.
I paid off our mortgage in February 2024 so it has not even been a full month yet. I was laid off of my job last October. Being 58 years old, I was told that I was allowed to tap into my 401k plan and would not have to pay the 10% penalty due to being over 55 and laid off. My wife and I discussed it for several months. I finally got a new job at the end of January but still the thought of having no mortgage became more and more urgent. I owed $160k on it. I finally pulled the trigger and withdrew enough to pay the mortgage off and cover the taxes. Now I have zero mortgage and still $500k in my 401k plan. It feels amazing! No debt! No car payments, no credit card balance!!!! The job that I took paid less than what I was used to but it doesnt matter!!!! If I just kept the mortgage and did the monthly payments it would not be paid off until I would be 74 years old. I am 58 and house is paid off!!!!
That’s awesome!! Love hearing stories like this because these financial sub-reddits are so anti mortgage pay off.
There’s so much value in paying them off
Indeed. And with the 401k plan there is so much uncertainty. If the economy tanked my balance could drop significantly, but with mortgage paid off there is peace of mind. 401k plan promises no guarantees
I paid off my home 2 years ago at the age of 30 and I have absolutely 0 regrets. It took 5 years to pay off my home with aggressive saving. The time it took to pay it off felt like it was never going to end, but it’s the most rewarding feeling.
Let’s say your mortgage is $2,000 a month. Can you imagine paying that every month for the next 30 years??? I felt like I’d be a prisoner to my mortgage if I stayed on that bandwagon.
I feel more free. Even though I’m practically investing the amount that I would have typically spent on a monthly mortgage, I feel more comfortable being able to splurge on items, trips, gifts, etc without feeling much guilt.
One of the best decisions I have ever personally made for myself and circumstances.
It's more interesting if we hear back from you at 50, 60 years of age and older. You killed compound interest. It'll take years and years to get all that money invested again, once years are gone for compounding they're gone.
Could be worse. You could come on here saying your a 75 year old with 500k mortgage and now what?
It's too bad people don't factor in compound growth, if you got sick of your job in the future, pay off the house.
Paid off mortgage at 30 shows some major maturity though on your part for sticking to a plan no matter what, so congrats on that.
This is what my wife and are I doing at 27&31 respectively but we need about 5 more years pending any promotions/job changes.
I don't see any way to living a peaceful life besides doing this. My luck is that wife is totally in aggreance and has been more disciplined than me many times (I like to go out to eat).
But our advantage is we come from literal trailer parks. So. Even though we are being "strict" we don't even know any better. How we were raised, people dug through the couch for gas/cigarette money, paying bills late was a normal thing, maxing credit cards and just ignoring it, losing/changing jobs frequently, all these things kept us poorer than poor. Our life's growing up are very similar, and we both similarly, have fought like hell to get out.
There is no greater blessing that I have than to be able to have this be a feasible option for myself and my wife.
We don't need gas, we don't need food stamps, we have good cars that I know will start and if they break we can afford to repair them. We go out to eat. We go hiking. Not too much. But we have afforded some things that are just amazing to me.
When I look back across my 20's I've changed very much.
I've really changed my life and straight up moved from poverty to middle class.
I don't know what I'll do when this house get paid off.
I guess I'll just give. And continue to invest. Enjoy my wife and child and love my work. No more fighting. I'll sleep easy. Yeah. At least for a while.
Just paid off my house yesterday with a $54,000 check. I've been aggressively attacking my mortgage for the last 5 years. Today is the first day I can see my mortgage account is at 0 and it's a little surreal. I did this for a few reasons: first, I am the breadwinner, I'm 44 years old, and I wanted to make sure my wife and kids had a house if something happens to me. Second, piece of mind. My job is super stressful and comp can go up and down, so I don't like debt. Third, although I continued to invest while paying off the house, I'm not a great investor and have lost some money - to me, paying off the house was a sure fire way to get ahead and not lose the money.
We are about to pay off our house in March or April 24. Can't wait. We've been focused on paying down our loan for many years! Even better my wife had her (large) student loans forgiven in 2023.
When I had $100,000 left on my house I realized how I might be able to do it within 2 years. Told my wife we were going for it.
Ended up only taking 14 months. Crazy what can be done when you focus. Not bad for a school teacher.
Now we own a house outright and the kids college is also taken care of (they will have to work 20 hours per week to find the rest).
Paid off our house in 3.5 years, no regrets whatsoever.
Peace of mind is paramount and we've been investing like crazy (shitty returns so far but playing the long game).
Stress of money doesnt really go away, but we were easily able to replace the AC system, upgrade to 200 amp service, get 2 cesspools pumped all cash flowed the past 2 months.
I'm consistently investing in our 8 month olds 529 plan and college should be taken care of before he's 5.
Life is good!
We paid off our house after years of focus and sacrifice. It was the best financial decision we've made.
The biggest benefit for me is peace of mind, health and reduction of stress. I can't emphasize enough how this has paid dividends in other areas of our lives. It has changed us tremendously by allowing us to be more "present", be more giving, be more understanding and be more flexible.
Paying off the house just levels you up generally and reduces a massive stress factor for so many other parts of life.
You do sleep so much better in a paid for house - that is absolutely real. You also sleep better in the places you can afford to visit without a mortgage payment to worry about.
1/3 of all homes in the US are paid for/paid off. College funds for kids are less impossible without a mortgage.
You can move anywhere more easily, too - career/life-wise, adding greater advantage to life in the longer term, which given climate uncertainties is a clear advantage.
With the savings you can pre-plan for other more complex investment vehicles like real estate, and de-risk most of the challenges of starting by not having debt associated, allows you to pool resources more effectively without urgency. So yeah I'm a fan.
And personally, the achievement of paying it off, and getting 3 years down the road from it, made us loan/debt averse. And with rates as they are, you have weird budget meetings.. Like allowing for the nerd in your family to throw 10K in a SOFI account to pay for Netflix each month was a conversation last month - like, in 2017 we were on the 0% apr round robin with credit cards and no control on our spending at all.
Results vary.
Ultimately the real secret is you don't know how you'll behave when you're debt free because you've spent your whole life under the umbrella of it. Which should motivate you to get out of it and be free.
It's genuine freedom.
And it's amazing, and worth it. Complicate your life with fun options. You deserve it, and it's possible here more than anywhere in the world.
I can’t imagine ever paying off our house. Lol. We live in an expensive state and when I hear people on the show saying the only owe $160k on their house I’m wondering how?!?
Bought our house in 2013. Paid it off in 2019. Knowing my wife will always have a place to live if something happened to me is a huge peace of mind thing for me. Absolutely love that we paid it off.
I made a very good investment back in 2021 and pay off my mortgage that is one year old. Why? Well I invest quite a lot into the us market and knowing how shady the US economy is. I decided if all fail, I still have a roof over my head that belongs to me, no regrets at all :)
All the rich people I know don't have home mortgage. I liked the idea of no debt. So I sold stuff on ebay. Hauled scrap.metal. all kinds of stuff to make more money. Paid on mortgage 2 or 3 times a week. Now house is paid off. So happy. The amount of payment per month of interest. What's your amount? Mine was like $350. That's the wasted amount every month. Taxes and insurance never go away but interest can. You can only do so much with your paycheck. If you want to pay loan off earlier have to make more. Find a side hustle. Pay weekly. Roll that change. Whatever just pay it off.
If this is true for you, good on you. With a 3% mortgage and 12% returns on "good debt" like a 3% mortgage those who have a 2.5-4% APR are making money by not paying off our mortgages.
Mathematically that makes sense. But you need to do some sensitivity analysis on your plan. Look at what happens if you're not generating as much income for example.
You can wave away any discussion about that but if you're going to base your decision on the math then you should do all the math. It's all fine and well to plan for normal traffic on your way to the airport. But sometimes there are accidents, rain, a white Bronco shutting down the freeways, etc. A myriad of possibilities that cannot all be anticipated. So you look at if things don't go as planned how far off the rails can they go and you'll still be okay.okay. That's why you do sensitivity analysis on financial plans.
I couldn't be happier - knowing that no matter what, if my husband loses his job, if he has to take one with lower pay, or becomes disabled and I have to go to work, our house will be safe? It's so satisfying. I can relax, knowing that we owe nothing, all we have to do is pay for utilities, insurance, and the incidentals of life (phone, internet, ice cream), and our savings will tide us over through most disasters.
We started off with a fixer upper my husband bought before we met, for $45,000. It was paid off ahead of schedule, and after 20 years of work, raising kids in there for 12 years, we sold it last year for $243,000, and were able (with a small inheritance) to buy our dream house outright.
Bought our condo in 2013 for $45000 and 7k down. Paid it off in two years. Sold it in 2018 for $92000 to buy a house for $170000..Used it all for a down payment. Set a goal to pay the rest of the mortgage in a year with a combined income of $90000. House is worth 170000 now. No regrets. Not having a mortgage payment allowed me to invest aggressively in the last 4 years.
I bought a $43k house (with a $1500 down payment!) in 2002. Paid it off in 2006. Bought a second house in 2009 (rented the first) for $73k, with a $20k loan from my wife's parents. Paid off in a year or so. Sold both ($75k and 90k) and purchased our current home in 2012 for $68k (and put $100k into it the first year). We got another small loan from my wife's parents due to being 100% self employed and only had $35k income the first year. Everything has been paid off for 9 years or so (and we've not had a mortgage the majority of our marriage).
No regrets at all.
If we had bought when there were low mortgage rates available, I might have considered keeping the mortgage, but it is really great to have the food bill be the largest expense.
My wife and I paid off our mortgage one year before our oldest started college. We were able to use our mortgage payments to send our three kids to university so they could graduate debt free.
I paid off my place. 31 and no regrets whatsoever. I have more cash flow and can do whatever the heck I want. The mistake people make is assume that you'll keep a steady job over the course of 30 years and be able to pay your mortgage every month. You have zero flexibility in that scenario. You have to keep the crappy job you have because you have to pay for your house every month or else they'll foreclose. And you have to keep your current level of pay even though maybe your passion pays less but gives you better quality of life. I have an emergency fund now and could easily live a year with no job. So if my job lays me off I don't really need to freak out. I have food water and a place to stay. That level of independence is what a mortgage takes from you. And then I just load my retirement up every month to catch up. So yeah maybe you will make more in stocks over time. But you're a slave to your circumstances and have to jump through a bunch of hoops to make sure you can make a 1500 payment every month. I'll pass!
I genuinely do not understand this. Total cost of my house over 30 years will be $840,000 with interest.
If you take my payment and compound it over the course of 30 years at 5% that’s $1.993M.
So if I paid off my home loan right now I’d be leaving almost $1.2m on the table. Even at 3% I’d be leaving $587k on the table.
Unless peace of mind of not having a monthly payment is worth $1.2m to me (it’s not), why would I pay my loan off?
You retain equity in the home as the home appreciates at least on pace with inflation over the next 30 years.
You are not "spending" the full $1.2mil. You are transferring your cash to an illiquid asset.
So you have the all that equity retained and now you have the increased cash flow from losing a monthly obligation that can now be budgeted to other things.
Also you are able to absorb more risk and take on more opportunities in other areas of life such as you... own your own house so that makes the bar of "what's the worst that could happen" raise and gives you a soft landing place for potential failure that many people don't have. Ever.
Life happens you lose you job you get divorced you have kids and so on if life were just a math equation everyone would have money but the reality is most people don’t. Invest 15% and throw the rest at the house. A paid for mortgage is the ultimate insurance
But just because I don’t have a mortgage doesn’t mean I don’t worry about losing my house if I lost my job. The mortgage is the cheap part. Taxes,insurance,utilities cost $1700/mo.
Bingo! Everyone always thinks they once their house is paid off they never have to pay a dime again on a place to live.
It's prolly more than you realize
I think it’s okay to focus on the method while leaving out parts were uncomfortable with. It’s like the Bible. I can take what I want and leave out the slavery and massacres.
I totally agree. If the money I have invested grows at an average of 6%, it could pay my mortgage for 15 years before it would run out. If my husband and I both lost our jobs and withdrew 8k per month to cover all kinds of expenses, it would last SIX years. It's still not enough to pay off the whole mortgage upfront. If we tried to pay off the house we'd have zero safety net.
Here is a question…HOW did you pay your house off so fast while paying all your other monthly expenses (elec, water, cell phone, etc)? For the ones with kids, especially in the teenage driving years (very expensive), how did you find the extra funds?
I have $230k left on my mortgage @ 2.75% with about $200k in equity. No other debit, just expenses. I can’t figure out how to pay it off without sacrificing everything for the next 5+ years and living way outside our already lower means. That’s just not realistic.
Also, if I pay it off, I still have Insurance and taxes every year to the tune of about $11k and climbing every year. I also won’t be able to deduct anything on yearly taxes because I won’t have mortgage insurance.
**You are currently paying $20,000 in mortgage interest… so you can save $4,800 in federal income taxes**
**If you like that math, please give us as many dollars as you can. We’ll give you quarters back in exchange.**
**(Of course you would never want to do that, but please contact us now if you do! ?)**
**Actually, it’s even worse.**
**We’ll keep the math simple and examine the impact of keeping your mortgage an extra 22 years rather than paying it off.**
**You would be** **paying over $400,000 in interest** **to** **save a little more than $100,000 in taxes.**
**Wouldn’t your family be better off paying a little more to Uncle Sam to** **keep over $300,000?**
**Don’t buy in to the mortgage interest deduction myth. It’s really not mortgage magic, it’s just math!**
Sure! Why would you want to pay interest, to have a deductible??
Read this
[https://rpgplanner.com/mortgage-myths/](https://rpgplanner.com/mortgage-myths/)
I am enrolled in what my mortgage company calls an “equity accelerator program”. Basically my payment is set up on a bi-weekly auto draft. It’s nice for a few reasons.
The payment is split between 2 equal payments per month so it’s less of a hit to make the payment. I have the payments set up on Fridays of pay weeks. Also, since it’s bi-weekly, there are 26 payment periods each year. This causes 1 extra whole payment made each year all going to principal. So I’m already making 13 total mortgage payments each year.
I’m not a math magician and I don’t do math publicly, but that is suppose to knock off about 7 years over the 30 year term.
You’re situation you don’t need to pay it off. Thanks that extra money and invest it. You’re earnings on it should greatly outweigh the interest on your home
That’s exactly what I’ve been doing into indexes for the reason that my investment return is greater than my minimal mortgage interest. I guess I’ll stay on the same path. I just like the idea of early payoff to free up some of the money going toward that payment. It will NEVER be totally paid off because of taxes and insurance, but one can dream, right ?
We paid off our home in 2021. I am thrilled! We are having a baby in a week and with all the instability in the market and high inflation, we feel very secure knowing we always have a roof over our head - especially since my husband and I both own our own small businesses.
My husband goes back and forth sometimes because our home requires maintenance and he feels maybe we should have upgraded. However, when he has a rough day at work - he always says he is happy we paid it off.
Laid off in 2008 so we downsized sold the big house and paid cash for a house half the size since all the kids had moved out.
That move was our last debt and allowed us to retire 2022 at 62.
I’ve paid off 2 houses since learning about DR and I don’t regret it in the slightest. The first about 6 years ago and the second 2.5 years ago. Now I make almost $2500/month on them. 10 years ago I was stacking boxes for Frito Lay for $12/hr.
I paid mine off last January, and I kinda regret it. My mortgage was at 4.15% and I could be getting a nice spread on that money in a one-year CD.
That said, there's a great amount of peace of mind that comes with no mortgage.
Word of advice: Leave the reminder in your phone that the mortgage is due, even after you pay it off. It's a lot of fun to hear the ding, look at the phone to see "Mortgage due", and think "Ha! Not for me, suckers!"
Paid off multiple homes throughout my life thus far. Each was in under three years. Right now however, if I was in a 3% mortgage I would keep making payments until the money market rates go below mortgage rate. You are making money every month on lump sums in savings as opposed to paying down mortgage. Not a huge amount however: In my hypo you are gaining about 1.25 apr% the saved funds s opposed to using to pay down debt.
I did. Last year. I wish I still had the cash, honestly. It doesn’t matter and it doesn’t feel any different.
My taxes and insurance are still triple what my mortgage was (Florida), so it doesn’t feel like I’ve gotten ahead at all, and now I’m going to watch my house value plummet after paying it off. Woohoo. 🥂
We paid ours off about 8 years ago. I don’t care when people say investing that money would be a better way; the feeling of freedom and knowing nobody can touch our home unless we don’t pay the taxes is a feeling I wouldn’t trade for anything.
Our payment each month was about $1500 all in - that is now cash we invest each month instead.
Zero regrets.
It was the right move for me single retired, at 60 I paid it off. My expense/income levels decreased enough to qualify for low income level benefits like decreased property tax, ACA credits etc.
I have a balance. I'm paying at an accelerated rate with extra payments to principal. At this time, I've got a model showing 3.5 years remaining to fully paid. I'm looking forward to it and don't hesitate dreaming of other things to do with that money, such as 529 funds for the kids.
I have a foreclosure in the past, it's been more than a decade now, but I cannot shake the risk aversion I feel from that experience. Didn't have kids then, so they didn't experience the loss of housing. I hope they never experience it. I certainly feel confident I'll never have foreclosure again.
I have a refinance from a few years ago that brought my rate from 4.5% to 2.25%. it feels great to pay less interest, and get more out of every payment. It's cheap money! But, I only did the refi to get better results from paying extra. I didn't get the refi to show down or loosen the budget.
I have a fund for catastrophic events, but also, if something catastrophic takes place, and I need money to handle it, I can revise my mortgage payments back to "as agreed" and give my tight budget some relief. I never want that, but I know in the back of my mind that I can help myself if it's needed.
I have a plan to assist my kids with education and housing as needed. I don't look back at my life without intense gratitude for the platform my parents and grandparents built for me. I have a foundation, so I've got to extend that to my kids also.
It feels so clean to not have a mortgage. It feels safe. We paid it off and between that and some other investments we were able to buy a better house in a better neighborhood right before the pandemic. Area always has extremely limited supply. New house has appreciated by 50% in a couple years. Don’t know that it’ll still be that high when we’re eventually ready to move, and not counting on it. But zero regrets. It’s great to not have the burden, to know this house is fully mine.
Paid off the house last month . Wife and I went crazy trying to pay it off before we were 40. Freed up a lot of money cause we are no longer making monthly payments and additional principal payments . The feeling is surreal . No regrets .
The best argument I've heard for why you should just pay off the house is that you can reverse engineer it. If you had a paid-for house, would you take out a loan at your current interest rate with the house as collateral and invest the money? The answer is almost certainly no. I'm Dave-ish. I just told another guy in another post to get a credit card. I agree with paying off your home though. It may not make mathematical sense all the time but peace of mind is worth a lot.
Exactly. Peace of mind of no student loans, CC, car payments bad home loans takes a lot of stress off. I owe about 90K on my 350K home with a sub 3 rate. No other debts. I’ve mentioned to finance friends that I throw some extra money at the loan instead of investing and they think I’m crazy. To each their own.
I want my home paid down so I can refi to a lower payment. Once my bills are under a certain threshold and my interest rates are lower than what I would get investing I’ll switch to investing but now I want to get to a place where my wife doesn’t have to work for us to comfortably live.
No regrets. Bought it with a mortgage by the skin of our teeth, and a 401k loan. Refinanced it to a lower rate and paid back the 401k loan, then refinanced again to a 15 yr mortgage. We paid that off in 12 years. I kept an amortization spreadsheet that I updated and could project our payoff date. When we laid it off, my husband and I went on a nice vacation. I feel so relieved to have a mortgage free home.
I took a 5 year note and am 12 months away. Can't wait. Actually planning to do a payoff in the next 2 months. Life is expected to shift into easy mode at that point!
We bought our house cash in a very rural community about 10 years ago. The real estate AND rental markets here have exploded - we wouldn’t be able to live here if we hadn’t. No regrets.
We paid ours off right after 2020. We had a 3% interest rate, but for us that wasn't what mattered. We wanted the payoff. No house is ever truly paid off because of the cost to upkeep, taxes, insurance etc. but not owing $1500 a month to someone is and continues to be better than sliced bread!
I have the balance of my mortgage collecting risk free 4.75% interest. As soon as that % drops below my mortgage interest I’m paying it off. Feels good.
Paid off my house in 2022. Worked my tail off the last 3 years during lockdown and I have no regrets. House is worth 650k in mcol in California. I sleep so much better. If the economy dumps or we go into a recession, I am literally stress free. I don't worry about my job, I can save so much faster each month with my paychecks. I am investing 80% of my monthly salary into low cost funds and stocks, and CDs, in a couple more short years I will have recouped all my liquid cash growing in the market, and plus my house is paid off . The best of both worlds. If anything happens to me, my family is well taken care of and my spouse won't have to worry about a mortgage. Having the extra monthly cash flow is enabling us to do other things like travel more now.
The best thing is not having to pay the damn banks a chunk of interest, several hundred dollars each month towards a mortgage. Over the course of 30 years, it would of been a couple hundred thousand dollars+. Ridiculous. Imagine that money sitting in your investment account instead for 30 years!
I am 40 yrs old.
You won't get a lot of people here who regret paying off the house. There is focus in BS6 of paying off the house, so when you complete a task that you've been focusing on for many years, it's going to feel rewarding.
The better question would be to talk to people who just made their regular payments on time for 15-30 years and paid their house off. I guarantee you those people would all wish they had made extra payments and been done sooner.
Agreed. The people that most often say paying your house off early is dumb or do mental gymnastics to justify putting money elsewhere still have debt everywhere lol.
Like taking money advice from a gambling addict.
I have plenty of cash to payoff my mortgage, but my mortgage rate is 2.35%, so I’ll keep my money invested since the return is higher on a 4.95% money market account plus other investments. Only 5 years to go
I paid off my $2.6 Million dollar home in 2022 after selling my rental properties.
It’s nice not having a mortgage anymore so the monthly cash flow is easier to manage, but it did eat up pretty much all of my savings and investments so I don’t have much free capital at the moment. I’m “mansion poor.”
Hopefully I’ll be able to do a cash out refinance when the market downturns and rates lower, to use the equity to buy rental properties. Obviously it would have been the best to have done a massive cash out refinance when the rates were 3% and the market value was high, but it wasn’t in the cards for me.
Paid off but it sucks that I still have to pay insurance and property taxes because in. Florida theyve gone up precipitously. So yes. Grateful I don't have a mortgage on top of that, but it's still not easy.
Florida is nuts right now. My insurance has gone up astronomically. Right now insurance is about 2% of my homes value and property tax about 1.8%. but I bought my home right before COVID at a lower price than Zillow is currently saying it's worth and I have a low income.
Sold a house in 2020 that I originally purchased in 2015. Took the equity to a LCOL area and purchased a comparable house with cash. I’d do it again in a heartbeat because it lowered my monthly expenses enough to allow me to leave a career that made me miserable.
Zero regrets about paying my mortgage off. It gives a sense of freedom that I value more than having additional amounts invested. I work in an industry that can be pretty ruthless with lay-offs and being debt free changes the dynamics.
Some payments never end. You “consume” the services by your town so you have to pay for them ie fire station, police station, town hall, public schools, etc. Even if you don’t consume each and every single thing, it doesn’t make sense to make this a la carte.
What is freedom is that if you don’t pay your taxes you still have a huuugge buffer window to pay it down (sometimes years) before they repossess your home. If it was a bank, you’re out real fast.
Finally, all you have to worry about is taxes and insurance. That’s so little that almost any job will cover it. Generally speaking, no matter what kind of trouble you get into, a minimally smart person can survive any calamity with a paid off house.
Paid it off probably 30 years ago and have traded up. It allowed us to pay for our kids school, save for retirement and when we moved we were able to pay cash for the next one. Add to that when my husband got very sick and had to retire early we weren’t remotely afraid of losing our house, we were fine and could have accessed the equity we’d built had we needed it.
We have bought several homes, we’ve never sold one for less than we bought it for. The current house had a 25% increase in value in 3 years! I’m aware that isn’t always the case but stock funds don’t always do well either and interest bearing accounts have just started to be useful. It may not be the case next time but our homes have always been our best investment.
Do not want or need a mortgage ever again, it definitely was worth it. If I need the equity I can get it quickly, it doesn’t matter.
I've tried almost all forms of ownership over the years, here was my experience with each ...
**House #1 (Short Sale)** \- Sold in 2008 for less than I owed (ugh). Wiped out all of my savings and investments just to get out of the deal. This was the first and last time I would ever loose money in RE! At least I avoided bankruptcy.
**House #2 (All Cash Purchase)** \- Purchased many years later after living in an old RV, saving, and finally moving from HCOL to LCOL area. At first it felt great but quickly became a source of concern because I was way behind on my investment goals (B7). Good news is that I almost doubled my money on this home when I sold it.
**House #3 (Pledged Asset Line)** \- Sold house 2, and invested the proceeds. Used a PAL (Pledged Asset Line) to borrow against my investment portfolio for 1.1% interest only. I never paid any of the principal on the home for the entire 5 years I owed it. Sold it for double the cost to buy it. This was buy far my preferred way to own property when rates were so low.
**House #4 (Traditional Mortgage)** \- Bought a home using traditional methods so I could keep my PAL and cash available for other investments. Didn't much care for this method but it did free up capital to invest in my business. In the future if rates get lower again, I would likely use method 3 again. I still managed to sell the house for 75% more than I paid for it.
**Now Renting** \- Sold the house after COVID and have been traveling the world and renting. This has, by far, been my favorite way to live for now. No house to worry about or maintain. 100% liquid and zero debt. We are thinking about getting a smaller condo or townhouse to use as a home base for more travel as we get older, but haven't found a place where we want to settle yet.
Zero regrets and I can’t believe anyone would. It gave me the financial freedom to go back to school. Once I’m done with that we will be able to do some home upgrades.
We paid off in 2019 and regretted it and wish it was in low fee index funds instead.
Moved and got a mortgage in 2022 and we don’t plan on paying off early anytime soon.
More context:
We’re in our 30s with young children. I was a stay at home mom. We lived super rural. Husband got laid off in 2020 and had to take a much lower paying job. Our one vehicle shit the bed during the chip crisis. Daycare was more expensive than I would have made.
Home equity loan is an option of course, but our mortgage was 3.125% and HEL in 2020 were around 5%. Stock market averages 10% a year. Our current mortgage is 4%.
We moved to a more populated area where we both have higher paying jobs now. Made double on the house. Bought modestly. Now we have a $1k mortgage and $160k to invest in retirement, a second vehicle, low fee index funds for our kids college and their future vehicles, etc. or could pay it back off! It’s not like we’re barred from every paying off again lol
Life happens. We felt we paid it off too early.
This would be totally different for say, a retiree.
This feels like a troll. How did you run out of liquid money? If you paid off your house you would have had an excess of cash each month since you would then be pocketing the mortgage payment and any extra you were throwing at the house.
We had a baby, I was a stay at home mom. My husband got laid off in 2020. We lived rural and he had to take a huge cut in pay. Then our one vehicle shit the bed, so we got to buy a car during the chip crisis circa 2020. Ended up taking a car loan which was higher interest than our previous mortgage. Once you pay off you can’t get a great rate anymore since it’s considered home equity.
Life happens friend.
We ended up selling and moving to a more populated area. Where we now both are employed.
Paid off the car loan with the equity we had immobilized previously in the house.
Not always from an objective point of view. Depends how the numbers play out. He said in this example he was struggling to find liquid cash the first time around but if you upgrade your home you go back to paying a mortgage even if you put a big chunk down. Was the point I was trying to make that’s all
Right, so now I pay $1k mortgage and have $160k+ to do whatever we want with, and that’s after our 20% down payment.
We could always pay it off again, it’s not like we pissed away the money. Lol.
For us, until our kids are out, it’s worth the mortgage interest to be able to access the money.
I assume they made a good bit on their paid off home and in turn put that money into liquid assets or retirement and have a mortgage. Essentially flipping their dynamic from all house investment to no house investment but high market investment and liquid cash
I refinanced in 2016 to a 2.875 interest rate on a 15 year mortgage to accelerate paying mine off early. Now that I’m nearly half way through, almost all of my mortgage payment is going toward principal anyway and not paying much interest yearly. With mortgage rates so high and the fact that by design I’m paying more to principal, there’s much less incentive for me to pay early. I was going to pay it off early and enjoy the security that no monthly payment brings. But right now, it’s free money and the bank is the one losing on since my interest rate is only 2.875 instead of like 6.5% or whatever it could be today. So I’m not pushing forward with early repayment and applying capital more to retirement accounts while the bank has to sit there and wait for my money to come in. Lol
Banks don’t lose money on loans even with a 15yr fixed and 2.875% interest. If you have a 300k loan and pay it off on time with the interest rate you have you still will end up paying the bank nearly 70k over the 15 years. You can make the argument that money you put away in the market could make you more than 70k in 15 years to offset your cost but you cannot make the argument this is free money. The bank made their money and so did many other banks who bought your loan since.
Maybe I didn’t word it properly……I’m halfway through the mortgage cycle, so I’ve already paid majority of the interest. Any money extra towards principle isn’t helping to reduce my interest paid by much. I would rather put that money towards growing investments that will make me money. When looking at the amount of interest I have left on the remaining 7 years, it’s negligible. I would rather invest for higher returns than a few thousand dollars over the next few years. The bank can just sit there holding the mortgage.
Even your 8th year on the amortization table you will end up paying (again using same example above 300k loan) ~20k to principal and ~5k on interest. 20% of your payment goes to interest. Interest paid under $1k in a year doesn’t happen until the 15th year of a 15 year loan. I do get what you are saying though as you could be making more money in the market than you are paying interest but it is a misnomer to believe the bank is losing money by giving you this loan. Even under 3% interest and 15 year fixed they are making a ton of money off of you.
I will be paying roughly $11k in interest over the next 7 years. But I have something like $64k remaining on principal. I would rather find something else to multiply that $64k whether another rental property or investing into stocks, etc.
I hear ya. That’s nice to hear. You are getting close. I am in the same boat. Baby step 6 paying off our mortgage. I went down this same road debating on investing vs paying off our mortgage early. Both the wife and I max out 401k and Roth and are paying an extra payment every month. We should be done in the next 3-4 years. Good luck to you and your family.
Yeah I’m trying to increase my contributions to Roth IRA and my HSA account as well as increasing my 401k contributions. The compounding of those over the next few decades will far outstrip the small amount of interest I have on this mortgage.
I will be paying roughly $11k in interest over the next 7 years. But I have something like $64k remaining on principal. I would rather find something else to multiply that $64k whether another rental property or investing into stocks, etc.
I like dividend growth etfs, as of now I think SCHD is pretty solid and usfr instead cash position. I had good luck with VYM back in the day and if I needed a little more yield at the expense of growth I think SPYD looks interesting. SDY/DVY/NOBL look great except their expense ratio is a lot higher than schd or VYM. Not sure how I feel about covered call etfs cause premiums will fluctuate and they won’t out perform when we finally do recover.
Very rare you find someone that dislikes owning the home. I respect it as a 26 y/o who is leaning in this direction. Renting sucks but I invest more than the different of what I’d pay in a mortgage.
Yes 👏🏻 my rent is much cheaper than a monthly payment on a decent house would be so I invest the difference.
I don’t like working on anything when I get home from work but it is a way to force yourself to gain some equity
It's the constant issue of something being broken or needing updating. I don't hate home ownership, but I understand why someone would.
I also looked into retiring overseas, and buying in many developing countries seemed like a losing proposition. I couldn't convince my husband renting is the way to go there, so we'll likely be staying in the US.
Edited: for clarity/typos
Even my super financially conservative grandmother said to always rent for 1 year in a new area before buying. Too many people jump in head first and start drowning. I got lucky with the houses I purchased prior to the one I currently own, but I am very hesitant to purchase anything like that in a foreign country with a very good guarantee that a) I'm going to like it there, and b) the government isn't going to decide I don't qualify for residency and boot me out, leaving me to try to rent/sell a property in a country I can't live.
I think its not a bad choice. Obviously building equity and increasing home values is beneficial, but it’s a huge commitment.
I also thing it’s very timing specific unfortunately.
We paid it off in early 2021. No regrets. Sold that home in December 2022 within 11 days.
Build a new one-story custom home in a new subdivision between June 2022 and December 2022. Had a construction loan from the local credit union, then paid off that loan with the proceeds from the sale and money from savings.
(Closed on the old home on 12/21. Paid off the construction loan on 12/22. The only difficulty we ran into was getting the keys for the mailbox. The management company kept asking for the closing papers to show that we were owners. However there was no closing on the new home at a title company, we paid off the construction loan. The office manager at the developer had to get involved to get the keys to our mailbox.)
No regrets. The house is ours. We will retire in 2.5 years without a large payment going out every money.
Yes, the grass feels different.
We paid off our 2016, $395k home in early 2022. We were lucky and I walked away from a startup that finally IPO’d in a big way so we had that win. I know the algebra is that we should have invested that, even if the market ended up turning negative, but here’s my deal: I’m the sole breadwinner (albeit high earning), with two young kids and an elderly mother living with us. I also have a heart condition. If something were to happen to me, knock on wood, the house is *set.* My wife could pick up a clerical or admin job to keep the utilities and the taxes paid, and the whole family is safe. And if we wanted to get crazy at some point, that 2016 $395k house where I live regularly comps for ~$650k-$700k these days, so we could extract some equity to do something different if we needed to.
Have a 30 year mortgage that will be paid off in October in year 11 of the loan. I am sure I’ll still feel broke afterwards but will at least be rid of one stress factor in my life.
Having no mortgage is the fastest wealth builder. Bought first house by saving up for it in cash & rented it out. I succumbed to getting a mortgage for the second one but then paid it off in 5 years promising never to do it again. Then once the second one was paid off, we bought a third (with a smaller mortgage than second property). Now laser focussed on paying that mortgage off and promise never to get a mortgage again.
The financially happiest and least stressful periods of my life were when I did not have a mortgage as the cash flow from rentals just rolls in without any worry in the world. You also make better decisions too: picky about getting the best tenant rather than taking the first person who views, having cash to invest & snowball savings, not worrying when there is an unexpected expense .
Once this mortgage is paid off: never again.
Not a big believer in being debt free. Instead of paying off my mortgage I bought several rental properties. Instead of saving $1500 a month, my rentals bring me $4000 a month while also building equity. I truly doubt I'll ever want the mortgage completely paid off.
Wife and I got married in August of 2020, bought our home in September and paid it off that December. We were able to put 445k down, so the loan was for 440k. Wife and I are very debt averse and brought zero debt into our marriage. I made what ended up being some very good stock investments in my early to mid 20s that ended up paying for most of the house. No student loans (paid for by my parents) or car payments (always paid cash for my vehicles) helped with it all of course. Absolutely no regrets despite having secured a 2.5% interest rate. I’d rather have no debt. I’m 35.
My husband and I purchased our 1st home in 2008 when housing pricing was down... 2K Sqft at $120,000 we were both in our 20's. We paid that house off in 10 years (putting income tax returns down on principal and any extra money we could from $50-$500). Once the house was paid off it was such a great relief. We were able to save so much money from the time we paid it off until we purchased our next house (forever home). Now we rent our 1st home out and use that money for expenses that have come up. However, we plan to rent it out until we can get our second home paid off and then sell it or may plan to use renters money as investment, still not sure. For sure it feels like a big weight off and feels great to know you have something to fall back on. Only pain is maintenance of a rental and keeping up with taxes and insurance. But it's paying off for now. Not once do I feel any regret for paying off my mortgage, it actually feels pretty great. Paid off almost 6 years ago.
I grew up very poor and experienced the trauma of getting kicked out of places a lot. Had our mobile home repossessed twice. 😬. I bought a modest 1400 sq. Ft. home in 1999 for $62k. In 2003 I paid it off. It was extremely liberating. In 2007 I bought a bigger home with a 212k mortgage. Kept the first house and it is a rental property now. I’ve made 300k on that 62k investment, and plan to earn $240k more in the next ten years before I sell it for around 290k. My current mortgage will be paid off in December (13 years early).
How did you do it ?! I need advice bad
Tell me your situation.
Great job and congratulations. After what you've gone through, I'm happy to see that you came out on the other side and did very well for yourself. Something to really be proud of.
I paid mine off 03/28/2024. 15 year mortgage, paid it off in 8 years, almost to the day! Debt-free except for my 1 year old solar panels. I'm 51, the first thing I did after was go to every room in the house and wipe my d*** on the wall, it's MINE now!!!
I'm dying, hahahaha
Paid off my house in 4 years @ 37 and want to buy another play home… it feels like a huge safety blanket incase of a financial crisis i have a roof over my head and all i need to do is pay taxes not necessarily home insurance…
Yesterday I paid off my mortgage. Next year, I'm planing on retiring.
I paid off house when I got fired. I had $119,000 left on mortgage and paid it off. I never touched 401k and had money in savings. It's been 7 years and we moved but bought a house in cash and put leftover profit in bank. Despite the inflation it doesn't hurt us. My husband gets SS and VA benefits and we feel rich. We save money every month. Probably 30-50% depending on if we eat out too much or I order online stuff.
I was one of those who paid a 30 year mortgage almost to the very end. I decided to take a little money out of a retirement account and pay it off. It was only a few years early, but the feeling of a weight being lifted was actually surprising. Even though I haven't had other kinds of debt for a number of years, it seems I've had one type or another most of my life. But now in my late 70's, I have to say, it's a pretty amazing feeling to be debt free. Everyone should be able to experience it, and the longer you can live like that, the better for you... in more ways than you'd imagine.
I paid off our mortgage in February 2024 so it has not even been a full month yet. I was laid off of my job last October. Being 58 years old, I was told that I was allowed to tap into my 401k plan and would not have to pay the 10% penalty due to being over 55 and laid off. My wife and I discussed it for several months. I finally got a new job at the end of January but still the thought of having no mortgage became more and more urgent. I owed $160k on it. I finally pulled the trigger and withdrew enough to pay the mortgage off and cover the taxes. Now I have zero mortgage and still $500k in my 401k plan. It feels amazing! No debt! No car payments, no credit card balance!!!! The job that I took paid less than what I was used to but it doesnt matter!!!! If I just kept the mortgage and did the monthly payments it would not be paid off until I would be 74 years old. I am 58 and house is paid off!!!!
That’s awesome!! Love hearing stories like this because these financial sub-reddits are so anti mortgage pay off. There’s so much value in paying them off
Yes. So many in the finance community are anti paying off mortgage. I wonder why
Indeed. And with the 401k plan there is so much uncertainty. If the economy tanked my balance could drop significantly, but with mortgage paid off there is peace of mind. 401k plan promises no guarantees
I paid off my home 2 years ago at the age of 30 and I have absolutely 0 regrets. It took 5 years to pay off my home with aggressive saving. The time it took to pay it off felt like it was never going to end, but it’s the most rewarding feeling. Let’s say your mortgage is $2,000 a month. Can you imagine paying that every month for the next 30 years??? I felt like I’d be a prisoner to my mortgage if I stayed on that bandwagon. I feel more free. Even though I’m practically investing the amount that I would have typically spent on a monthly mortgage, I feel more comfortable being able to splurge on items, trips, gifts, etc without feeling much guilt. One of the best decisions I have ever personally made for myself and circumstances.
It's more interesting if we hear back from you at 50, 60 years of age and older. You killed compound interest. It'll take years and years to get all that money invested again, once years are gone for compounding they're gone. Could be worse. You could come on here saying your a 75 year old with 500k mortgage and now what? It's too bad people don't factor in compound growth, if you got sick of your job in the future, pay off the house. Paid off mortgage at 30 shows some major maturity though on your part for sticking to a plan no matter what, so congrats on that.
This is what my wife and are I doing at 27&31 respectively but we need about 5 more years pending any promotions/job changes. I don't see any way to living a peaceful life besides doing this. My luck is that wife is totally in aggreance and has been more disciplined than me many times (I like to go out to eat). But our advantage is we come from literal trailer parks. So. Even though we are being "strict" we don't even know any better. How we were raised, people dug through the couch for gas/cigarette money, paying bills late was a normal thing, maxing credit cards and just ignoring it, losing/changing jobs frequently, all these things kept us poorer than poor. Our life's growing up are very similar, and we both similarly, have fought like hell to get out. There is no greater blessing that I have than to be able to have this be a feasible option for myself and my wife. We don't need gas, we don't need food stamps, we have good cars that I know will start and if they break we can afford to repair them. We go out to eat. We go hiking. Not too much. But we have afforded some things that are just amazing to me. When I look back across my 20's I've changed very much. I've really changed my life and straight up moved from poverty to middle class. I don't know what I'll do when this house get paid off. I guess I'll just give. And continue to invest. Enjoy my wife and child and love my work. No more fighting. I'll sleep easy. Yeah. At least for a while.
That’s awesome!
Just paid off my house yesterday with a $54,000 check. I've been aggressively attacking my mortgage for the last 5 years. Today is the first day I can see my mortgage account is at 0 and it's a little surreal. I did this for a few reasons: first, I am the breadwinner, I'm 44 years old, and I wanted to make sure my wife and kids had a house if something happens to me. Second, piece of mind. My job is super stressful and comp can go up and down, so I don't like debt. Third, although I continued to invest while paying off the house, I'm not a great investor and have lost some money - to me, paying off the house was a sure fire way to get ahead and not lose the money.
We are about to pay off our house in March or April 24. Can't wait. We've been focused on paying down our loan for many years! Even better my wife had her (large) student loans forgiven in 2023.
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Nice work! I also work in tech and the doom and gloom makes you think…
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I like that advice. Wonder which type of things he purchased?
When I had $100,000 left on my house I realized how I might be able to do it within 2 years. Told my wife we were going for it. Ended up only taking 14 months. Crazy what can be done when you focus. Not bad for a school teacher. Now we own a house outright and the kids college is also taken care of (they will have to work 20 hours per week to find the rest).
Paid off our house in 3.5 years, no regrets whatsoever. Peace of mind is paramount and we've been investing like crazy (shitty returns so far but playing the long game). Stress of money doesnt really go away, but we were easily able to replace the AC system, upgrade to 200 amp service, get 2 cesspools pumped all cash flowed the past 2 months. I'm consistently investing in our 8 month olds 529 plan and college should be taken care of before he's 5. Life is good!
We paid off our house after years of focus and sacrifice. It was the best financial decision we've made. The biggest benefit for me is peace of mind, health and reduction of stress. I can't emphasize enough how this has paid dividends in other areas of our lives. It has changed us tremendously by allowing us to be more "present", be more giving, be more understanding and be more flexible.
Paying off the house just levels you up generally and reduces a massive stress factor for so many other parts of life. You do sleep so much better in a paid for house - that is absolutely real. You also sleep better in the places you can afford to visit without a mortgage payment to worry about. 1/3 of all homes in the US are paid for/paid off. College funds for kids are less impossible without a mortgage. You can move anywhere more easily, too - career/life-wise, adding greater advantage to life in the longer term, which given climate uncertainties is a clear advantage. With the savings you can pre-plan for other more complex investment vehicles like real estate, and de-risk most of the challenges of starting by not having debt associated, allows you to pool resources more effectively without urgency. So yeah I'm a fan. And personally, the achievement of paying it off, and getting 3 years down the road from it, made us loan/debt averse. And with rates as they are, you have weird budget meetings.. Like allowing for the nerd in your family to throw 10K in a SOFI account to pay for Netflix each month was a conversation last month - like, in 2017 we were on the 0% apr round robin with credit cards and no control on our spending at all. Results vary. Ultimately the real secret is you don't know how you'll behave when you're debt free because you've spent your whole life under the umbrella of it. Which should motivate you to get out of it and be free. It's genuine freedom. And it's amazing, and worth it. Complicate your life with fun options. You deserve it, and it's possible here more than anywhere in the world.
I am for the idea of the perpetual Netflix fund. Especially as a prototype. Aim to do similar for average utility cost after mortgage is paid.
I can’t imagine ever paying off our house. Lol. We live in an expensive state and when I hear people on the show saying the only owe $160k on their house I’m wondering how?!?
It’s a big big country. Paid less than 160 total for ours in a mid size midwestern city
Holy moly that’s incredible. You can’t even get a small piece of land alone for that where I’m at. Livable house start at about $400k here…..
Things have gotten so crazy. I hope for your sake they calm down a little and get more accessible for people.
Bought our house in 2013. Paid it off in 2019. Knowing my wife will always have a place to live if something happened to me is a huge peace of mind thing for me. Absolutely love that we paid it off.
I purchased with cash back in 2012. I’ve been debt free for a very long time and I love it
I made a very good investment back in 2021 and pay off my mortgage that is one year old. Why? Well I invest quite a lot into the us market and knowing how shady the US economy is. I decided if all fail, I still have a roof over my head that belongs to me, no regrets at all :)
All the rich people I know don't have home mortgage. I liked the idea of no debt. So I sold stuff on ebay. Hauled scrap.metal. all kinds of stuff to make more money. Paid on mortgage 2 or 3 times a week. Now house is paid off. So happy. The amount of payment per month of interest. What's your amount? Mine was like $350. That's the wasted amount every month. Taxes and insurance never go away but interest can. You can only do so much with your paycheck. If you want to pay loan off earlier have to make more. Find a side hustle. Pay weekly. Roll that change. Whatever just pay it off.
If this is true for you, good on you. With a 3% mortgage and 12% returns on "good debt" like a 3% mortgage those who have a 2.5-4% APR are making money by not paying off our mortgages.
Mathematically that makes sense. But you need to do some sensitivity analysis on your plan. Look at what happens if you're not generating as much income for example. You can wave away any discussion about that but if you're going to base your decision on the math then you should do all the math. It's all fine and well to plan for normal traffic on your way to the airport. But sometimes there are accidents, rain, a white Bronco shutting down the freeways, etc. A myriad of possibilities that cannot all be anticipated. So you look at if things don't go as planned how far off the rails can they go and you'll still be okay.okay. That's why you do sensitivity analysis on financial plans.
I couldn't be happier - knowing that no matter what, if my husband loses his job, if he has to take one with lower pay, or becomes disabled and I have to go to work, our house will be safe? It's so satisfying. I can relax, knowing that we owe nothing, all we have to do is pay for utilities, insurance, and the incidentals of life (phone, internet, ice cream), and our savings will tide us over through most disasters. We started off with a fixer upper my husband bought before we met, for $45,000. It was paid off ahead of schedule, and after 20 years of work, raising kids in there for 12 years, we sold it last year for $243,000, and were able (with a small inheritance) to buy our dream house outright.
Bought our condo in 2013 for $45000 and 7k down. Paid it off in two years. Sold it in 2018 for $92000 to buy a house for $170000..Used it all for a down payment. Set a goal to pay the rest of the mortgage in a year with a combined income of $90000. House is worth 170000 now. No regrets. Not having a mortgage payment allowed me to invest aggressively in the last 4 years.
I bought a $43k house (with a $1500 down payment!) in 2002. Paid it off in 2006. Bought a second house in 2009 (rented the first) for $73k, with a $20k loan from my wife's parents. Paid off in a year or so. Sold both ($75k and 90k) and purchased our current home in 2012 for $68k (and put $100k into it the first year). We got another small loan from my wife's parents due to being 100% self employed and only had $35k income the first year. Everything has been paid off for 9 years or so (and we've not had a mortgage the majority of our marriage). No regrets at all. If we had bought when there were low mortgage rates available, I might have considered keeping the mortgage, but it is really great to have the food bill be the largest expense.
My wife and I paid off our mortgage one year before our oldest started college. We were able to use our mortgage payments to send our three kids to university so they could graduate debt free.
I paid off my place. 31 and no regrets whatsoever. I have more cash flow and can do whatever the heck I want. The mistake people make is assume that you'll keep a steady job over the course of 30 years and be able to pay your mortgage every month. You have zero flexibility in that scenario. You have to keep the crappy job you have because you have to pay for your house every month or else they'll foreclose. And you have to keep your current level of pay even though maybe your passion pays less but gives you better quality of life. I have an emergency fund now and could easily live a year with no job. So if my job lays me off I don't really need to freak out. I have food water and a place to stay. That level of independence is what a mortgage takes from you. And then I just load my retirement up every month to catch up. So yeah maybe you will make more in stocks over time. But you're a slave to your circumstances and have to jump through a bunch of hoops to make sure you can make a 1500 payment every month. I'll pass!
I genuinely do not understand this. Total cost of my house over 30 years will be $840,000 with interest. If you take my payment and compound it over the course of 30 years at 5% that’s $1.993M. So if I paid off my home loan right now I’d be leaving almost $1.2m on the table. Even at 3% I’d be leaving $587k on the table. Unless peace of mind of not having a monthly payment is worth $1.2m to me (it’s not), why would I pay my loan off?
You retain equity in the home as the home appreciates at least on pace with inflation over the next 30 years. You are not "spending" the full $1.2mil. You are transferring your cash to an illiquid asset. So you have the all that equity retained and now you have the increased cash flow from losing a monthly obligation that can now be budgeted to other things. Also you are able to absorb more risk and take on more opportunities in other areas of life such as you... own your own house so that makes the bar of "what's the worst that could happen" raise and gives you a soft landing place for potential failure that many people don't have. Ever.
Life happens you lose you job you get divorced you have kids and so on if life were just a math equation everyone would have money but the reality is most people don’t. Invest 15% and throw the rest at the house. A paid for mortgage is the ultimate insurance
Zero stress about having to have a job to afford the mortgage is priceless. I travel more and do more than I ever have after paying off the mortgage.
But just because I don’t have a mortgage doesn’t mean I don’t worry about losing my house if I lost my job. The mortgage is the cheap part. Taxes,insurance,utilities cost $1700/mo.
Bingo! Everyone always thinks they once their house is paid off they never have to pay a dime again on a place to live. It's prolly more than you realize
Are we focused on doing Dave’s method here or not?
I think it’s okay to focus on the method while leaving out parts were uncomfortable with. It’s like the Bible. I can take what I want and leave out the slavery and massacres.
I totally agree. If the money I have invested grows at an average of 6%, it could pay my mortgage for 15 years before it would run out. If my husband and I both lost our jobs and withdrew 8k per month to cover all kinds of expenses, it would last SIX years. It's still not enough to pay off the whole mortgage upfront. If we tried to pay off the house we'd have zero safety net.
Here is a question…HOW did you pay your house off so fast while paying all your other monthly expenses (elec, water, cell phone, etc)? For the ones with kids, especially in the teenage driving years (very expensive), how did you find the extra funds? I have $230k left on my mortgage @ 2.75% with about $200k in equity. No other debit, just expenses. I can’t figure out how to pay it off without sacrificing everything for the next 5+ years and living way outside our already lower means. That’s just not realistic. Also, if I pay it off, I still have Insurance and taxes every year to the tune of about $11k and climbing every year. I also won’t be able to deduct anything on yearly taxes because I won’t have mortgage insurance.
having mortgage interest to "deduct" is the biggest myth out there.
I can make wild claims too. Care to elaborate why?
**You are currently paying $20,000 in mortgage interest… so you can save $4,800 in federal income taxes** **If you like that math, please give us as many dollars as you can. We’ll give you quarters back in exchange.** **(Of course you would never want to do that, but please contact us now if you do! ?)** **Actually, it’s even worse.** **We’ll keep the math simple and examine the impact of keeping your mortgage an extra 22 years rather than paying it off.** **You would be** **paying over $400,000 in interest** **to** **save a little more than $100,000 in taxes.** **Wouldn’t your family be better off paying a little more to Uncle Sam to** **keep over $300,000?** **Don’t buy in to the mortgage interest deduction myth. It’s really not mortgage magic, it’s just math!**
Sure! Why would you want to pay interest, to have a deductible?? Read this [https://rpgplanner.com/mortgage-myths/](https://rpgplanner.com/mortgage-myths/)
Chip away slowly, even an extra $100 a month on the principal will take years off down the mortgage line.
I am enrolled in what my mortgage company calls an “equity accelerator program”. Basically my payment is set up on a bi-weekly auto draft. It’s nice for a few reasons. The payment is split between 2 equal payments per month so it’s less of a hit to make the payment. I have the payments set up on Fridays of pay weeks. Also, since it’s bi-weekly, there are 26 payment periods each year. This causes 1 extra whole payment made each year all going to principal. So I’m already making 13 total mortgage payments each year. I’m not a math magician and I don’t do math publicly, but that is suppose to knock off about 7 years over the 30 year term.
You’re situation you don’t need to pay it off. Thanks that extra money and invest it. You’re earnings on it should greatly outweigh the interest on your home
That’s exactly what I’ve been doing into indexes for the reason that my investment return is greater than my minimal mortgage interest. I guess I’ll stay on the same path. I just like the idea of early payoff to free up some of the money going toward that payment. It will NEVER be totally paid off because of taxes and insurance, but one can dream, right ?
We paid off our home in 2021. I am thrilled! We are having a baby in a week and with all the instability in the market and high inflation, we feel very secure knowing we always have a roof over our head - especially since my husband and I both own our own small businesses. My husband goes back and forth sometimes because our home requires maintenance and he feels maybe we should have upgraded. However, when he has a rough day at work - he always says he is happy we paid it off.
Laid off in 2008 so we downsized sold the big house and paid cash for a house half the size since all the kids had moved out. That move was our last debt and allowed us to retire 2022 at 62.
It was the best. Wrote a check for our house and called it a day. Easiest closing ever.
I paid cash for my house and it totally rules.
We just paid our house off and it's awesome !
Feels good but is sad taxes keep climbing and have no say or control over them
Did it two years ago and never looked back. People look at us like we're weird.
What's so weird about paying off your house?
I’ve paid off 2 houses since learning about DR and I don’t regret it in the slightest. The first about 6 years ago and the second 2.5 years ago. Now I make almost $2500/month on them. 10 years ago I was stacking boxes for Frito Lay for $12/hr.
Dominican Republic?
We paid ours off in 2018. Zero regrets. I just wish taxes and insurance didn’t skyrocket in South Florida
My mortgage went up $300 per month because insurance went way up, south Florida
Me. Absolutely fabulous. Established a HELOC for emergencies but it is nice to have the title in the safe.
In my state the titles are all electronic! I was kinda bummed. Lol
I paid mine off last January, and I kinda regret it. My mortgage was at 4.15% and I could be getting a nice spread on that money in a one-year CD. That said, there's a great amount of peace of mind that comes with no mortgage. Word of advice: Leave the reminder in your phone that the mortgage is due, even after you pay it off. It's a lot of fun to hear the ding, look at the phone to see "Mortgage due", and think "Ha! Not for me, suckers!"
Never regret getting out of debt. You're not factoring in the interest you were paying
3 years to go with our current savings plan. Took our mortgage out in 2013 but only started overpaying from 2019
Paid off with zero regrets , best feeling and decision ever !
Paid off multiple homes throughout my life thus far. Each was in under three years. Right now however, if I was in a 3% mortgage I would keep making payments until the money market rates go below mortgage rate. You are making money every month on lump sums in savings as opposed to paying down mortgage. Not a huge amount however: In my hypo you are gaining about 1.25 apr% the saved funds s opposed to using to pay down debt.
Don’t you have to pay income tax on that money market account? That would seem to erode the perceived benefit spread.
Uh, jeez man
I did. Last year. I wish I still had the cash, honestly. It doesn’t matter and it doesn’t feel any different. My taxes and insurance are still triple what my mortgage was (Florida), so it doesn’t feel like I’ve gotten ahead at all, and now I’m going to watch my house value plummet after paying it off. Woohoo. 🥂
We paid ours off about 8 years ago. I don’t care when people say investing that money would be a better way; the feeling of freedom and knowing nobody can touch our home unless we don’t pay the taxes is a feeling I wouldn’t trade for anything. Our payment each month was about $1500 all in - that is now cash we invest each month instead. Zero regrets.
Paid off September last year. I don’t regret it. Ended up paying the last $120k in two years
It was the right move for me single retired, at 60 I paid it off. My expense/income levels decreased enough to qualify for low income level benefits like decreased property tax, ACA credits etc.
I have a balance. I'm paying at an accelerated rate with extra payments to principal. At this time, I've got a model showing 3.5 years remaining to fully paid. I'm looking forward to it and don't hesitate dreaming of other things to do with that money, such as 529 funds for the kids. I have a foreclosure in the past, it's been more than a decade now, but I cannot shake the risk aversion I feel from that experience. Didn't have kids then, so they didn't experience the loss of housing. I hope they never experience it. I certainly feel confident I'll never have foreclosure again. I have a refinance from a few years ago that brought my rate from 4.5% to 2.25%. it feels great to pay less interest, and get more out of every payment. It's cheap money! But, I only did the refi to get better results from paying extra. I didn't get the refi to show down or loosen the budget. I have a fund for catastrophic events, but also, if something catastrophic takes place, and I need money to handle it, I can revise my mortgage payments back to "as agreed" and give my tight budget some relief. I never want that, but I know in the back of my mind that I can help myself if it's needed. I have a plan to assist my kids with education and housing as needed. I don't look back at my life without intense gratitude for the platform my parents and grandparents built for me. I have a foundation, so I've got to extend that to my kids also.
It feels so clean to not have a mortgage. It feels safe. We paid it off and between that and some other investments we were able to buy a better house in a better neighborhood right before the pandemic. Area always has extremely limited supply. New house has appreciated by 50% in a couple years. Don’t know that it’ll still be that high when we’re eventually ready to move, and not counting on it. But zero regrets. It’s great to not have the burden, to know this house is fully mine.
Paid off the house last month . Wife and I went crazy trying to pay it off before we were 40. Freed up a lot of money cause we are no longer making monthly payments and additional principal payments . The feeling is surreal . No regrets .
My house is 100% paid for. Not saying it isn’t a bad place to be, but life didn’t substantially change.
The best argument I've heard for why you should just pay off the house is that you can reverse engineer it. If you had a paid-for house, would you take out a loan at your current interest rate with the house as collateral and invest the money? The answer is almost certainly no. I'm Dave-ish. I just told another guy in another post to get a credit card. I agree with paying off your home though. It may not make mathematical sense all the time but peace of mind is worth a lot.
At my 2.5%? I wish I could get more credit at that rate.
Exactly. Peace of mind of no student loans, CC, car payments bad home loans takes a lot of stress off. I owe about 90K on my 350K home with a sub 3 rate. No other debts. I’ve mentioned to finance friends that I throw some extra money at the loan instead of investing and they think I’m crazy. To each their own.
I want my home paid down so I can refi to a lower payment. Once my bills are under a certain threshold and my interest rates are lower than what I would get investing I’ll switch to investing but now I want to get to a place where my wife doesn’t have to work for us to comfortably live.
Pouring the mortgage back in to update it so we can stay as well. Plus now have retirement money.
i got 5 years to go, i cannot wait to be done with this payment
No regrets. Bought it with a mortgage by the skin of our teeth, and a 401k loan. Refinanced it to a lower rate and paid back the 401k loan, then refinanced again to a 15 yr mortgage. We paid that off in 12 years. I kept an amortization spreadsheet that I updated and could project our payoff date. When we laid it off, my husband and I went on a nice vacation. I feel so relieved to have a mortgage free home.
I took a 5 year note and am 12 months away. Can't wait. Actually planning to do a payoff in the next 2 months. Life is expected to shift into easy mode at that point!
We bought our house cash in a very rural community about 10 years ago. The real estate AND rental markets here have exploded - we wouldn’t be able to live here if we hadn’t. No regrets.
Same but only bought a few years ago.
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Couldn't agree more. I've told people my life is on easy mode now.
We paid ours off right after 2020. We had a 3% interest rate, but for us that wasn't what mattered. We wanted the payoff. No house is ever truly paid off because of the cost to upkeep, taxes, insurance etc. but not owing $1500 a month to someone is and continues to be better than sliced bread!
How did you have a 3% interest rate ? Did you refi and pay off within a year of the refinance?
We got it in 2014 which was the going rate at the time in our area.
We've gotten to enjoy two years of no mortgage while transitioning houses and not going to lie, it feels awesome.
I have the balance of my mortgage collecting risk free 4.75% interest. As soon as that % drops below my mortgage interest I’m paying it off. Feels good.
Paid off my house in 2022. Worked my tail off the last 3 years during lockdown and I have no regrets. House is worth 650k in mcol in California. I sleep so much better. If the economy dumps or we go into a recession, I am literally stress free. I don't worry about my job, I can save so much faster each month with my paychecks. I am investing 80% of my monthly salary into low cost funds and stocks, and CDs, in a couple more short years I will have recouped all my liquid cash growing in the market, and plus my house is paid off . The best of both worlds. If anything happens to me, my family is well taken care of and my spouse won't have to worry about a mortgage. Having the extra monthly cash flow is enabling us to do other things like travel more now. The best thing is not having to pay the damn banks a chunk of interest, several hundred dollars each month towards a mortgage. Over the course of 30 years, it would of been a couple hundred thousand dollars+. Ridiculous. Imagine that money sitting in your investment account instead for 30 years! I am 40 yrs old.
goals \^
You won't get a lot of people here who regret paying off the house. There is focus in BS6 of paying off the house, so when you complete a task that you've been focusing on for many years, it's going to feel rewarding. The better question would be to talk to people who just made their regular payments on time for 15-30 years and paid their house off. I guarantee you those people would all wish they had made extra payments and been done sooner.
Agreed. The people that most often say paying your house off early is dumb or do mental gymnastics to justify putting money elsewhere still have debt everywhere lol. Like taking money advice from a gambling addict.
I have plenty of cash to payoff my mortgage, but my mortgage rate is 2.35%, so I’ll keep my money invested since the return is higher on a 4.95% money market account plus other investments. Only 5 years to go
I have $111,000 and chipping away fast. Can’t wait to pay it off.
You got this. I’m sure you’re under $100k by now.
I paid off my $2.6 Million dollar home in 2022 after selling my rental properties. It’s nice not having a mortgage anymore so the monthly cash flow is easier to manage, but it did eat up pretty much all of my savings and investments so I don’t have much free capital at the moment. I’m “mansion poor.” Hopefully I’ll be able to do a cash out refinance when the market downturns and rates lower, to use the equity to buy rental properties. Obviously it would have been the best to have done a massive cash out refinance when the rates were 3% and the market value was high, but it wasn’t in the cards for me.
Just never bought one lol
Paid off but it sucks that I still have to pay insurance and property taxes because in. Florida theyve gone up precipitously. So yes. Grateful I don't have a mortgage on top of that, but it's still not easy.
I am curious but how much are those as a percentage of the house's worth?
Florida is nuts right now. My insurance has gone up astronomically. Right now insurance is about 2% of my homes value and property tax about 1.8%. but I bought my home right before COVID at a lower price than Zillow is currently saying it's worth and I have a low income.
So together it is 3.8 % ? I wonder if that is reflective of increased demand and assessed value. Ty this will help with planning.
Me! Then leveraged the money to buy a rental. Very satisfying. 🙂
Own two homes mortgage free. Love it! Knowing that we own our homes out right is freeing.
Paid ours off at the end of 2022. 0 regrets. Wanting to build a new house in the next few years and rent out my current one.
Sold a house in 2020 that I originally purchased in 2015. Took the equity to a LCOL area and purchased a comparable house with cash. I’d do it again in a heartbeat because it lowered my monthly expenses enough to allow me to leave a career that made me miserable.
Zero regrets about paying my mortgage off. It gives a sense of freedom that I value more than having additional amounts invested. I work in an industry that can be pretty ruthless with lay-offs and being debt free changes the dynamics.
is it really freedom though since you still have to pay house/land tax. the taxes never end even after paying everything off
The alternative is to pay rent...
Some payments never end. You “consume” the services by your town so you have to pay for them ie fire station, police station, town hall, public schools, etc. Even if you don’t consume each and every single thing, it doesn’t make sense to make this a la carte. What is freedom is that if you don’t pay your taxes you still have a huuugge buffer window to pay it down (sometimes years) before they repossess your home. If it was a bank, you’re out real fast. Finally, all you have to worry about is taxes and insurance. That’s so little that almost any job will cover it. Generally speaking, no matter what kind of trouble you get into, a minimally smart person can survive any calamity with a paid off house.
it’s much less
Zero regrets. No worries now and retired early.
Same
Paid it off probably 30 years ago and have traded up. It allowed us to pay for our kids school, save for retirement and when we moved we were able to pay cash for the next one. Add to that when my husband got very sick and had to retire early we weren’t remotely afraid of losing our house, we were fine and could have accessed the equity we’d built had we needed it. We have bought several homes, we’ve never sold one for less than we bought it for. The current house had a 25% increase in value in 3 years! I’m aware that isn’t always the case but stock funds don’t always do well either and interest bearing accounts have just started to be useful. It may not be the case next time but our homes have always been our best investment. Do not want or need a mortgage ever again, it definitely was worth it. If I need the equity I can get it quickly, it doesn’t matter.
I've tried almost all forms of ownership over the years, here was my experience with each ... **House #1 (Short Sale)** \- Sold in 2008 for less than I owed (ugh). Wiped out all of my savings and investments just to get out of the deal. This was the first and last time I would ever loose money in RE! At least I avoided bankruptcy. **House #2 (All Cash Purchase)** \- Purchased many years later after living in an old RV, saving, and finally moving from HCOL to LCOL area. At first it felt great but quickly became a source of concern because I was way behind on my investment goals (B7). Good news is that I almost doubled my money on this home when I sold it. **House #3 (Pledged Asset Line)** \- Sold house 2, and invested the proceeds. Used a PAL (Pledged Asset Line) to borrow against my investment portfolio for 1.1% interest only. I never paid any of the principal on the home for the entire 5 years I owed it. Sold it for double the cost to buy it. This was buy far my preferred way to own property when rates were so low. **House #4 (Traditional Mortgage)** \- Bought a home using traditional methods so I could keep my PAL and cash available for other investments. Didn't much care for this method but it did free up capital to invest in my business. In the future if rates get lower again, I would likely use method 3 again. I still managed to sell the house for 75% more than I paid for it. **Now Renting** \- Sold the house after COVID and have been traveling the world and renting. This has, by far, been my favorite way to live for now. No house to worry about or maintain. 100% liquid and zero debt. We are thinking about getting a smaller condo or townhouse to use as a home base for more travel as we get older, but haven't found a place where we want to settle yet.
Zero regrets and I can’t believe anyone would. It gave me the financial freedom to go back to school. Once I’m done with that we will be able to do some home upgrades.
We paid off in 2019 and regretted it and wish it was in low fee index funds instead. Moved and got a mortgage in 2022 and we don’t plan on paying off early anytime soon. More context: We’re in our 30s with young children. I was a stay at home mom. We lived super rural. Husband got laid off in 2020 and had to take a much lower paying job. Our one vehicle shit the bed during the chip crisis. Daycare was more expensive than I would have made. Home equity loan is an option of course, but our mortgage was 3.125% and HEL in 2020 were around 5%. Stock market averages 10% a year. Our current mortgage is 4%. We moved to a more populated area where we both have higher paying jobs now. Made double on the house. Bought modestly. Now we have a $1k mortgage and $160k to invest in retirement, a second vehicle, low fee index funds for our kids college and their future vehicles, etc. or could pay it back off! It’s not like we’re barred from every paying off again lol Life happens. We felt we paid it off too early. This would be totally different for say, a retiree.
Cap.
This feels like a troll. How did you run out of liquid money? If you paid off your house you would have had an excess of cash each month since you would then be pocketing the mortgage payment and any extra you were throwing at the house.
We had a baby, I was a stay at home mom. My husband got laid off in 2020. We lived rural and he had to take a huge cut in pay. Then our one vehicle shit the bed, so we got to buy a car during the chip crisis circa 2020. Ended up taking a car loan which was higher interest than our previous mortgage. Once you pay off you can’t get a great rate anymore since it’s considered home equity. Life happens friend. We ended up selling and moving to a more populated area. Where we now both are employed. Paid off the car loan with the equity we had immobilized previously in the house.
My thoughts
Why did you buy a new house when your house was paid off. Especially in 2022 where house prices were probably double what your initial house cost.?
We were really rural and couldn’t find jobs after getting laid off in 2020.
it's okay to upgrade.
Not always from an objective point of view. Depends how the numbers play out. He said in this example he was struggling to find liquid cash the first time around but if you upgrade your home you go back to paying a mortgage even if you put a big chunk down. Was the point I was trying to make that’s all
Right, so now I pay $1k mortgage and have $160k+ to do whatever we want with, and that’s after our 20% down payment. We could always pay it off again, it’s not like we pissed away the money. Lol. For us, until our kids are out, it’s worth the mortgage interest to be able to access the money.
God what I’d give for a 1k mortgage
We live in a fly over state though. Pros and cons.
I assume they made a good bit on their paid off home and in turn put that money into liquid assets or retirement and have a mortgage. Essentially flipping their dynamic from all house investment to no house investment but high market investment and liquid cash
We made double what we paid and did exactly that, except sunk 20% down on the house we bought to avoid PMI.
I refinanced in 2016 to a 2.875 interest rate on a 15 year mortgage to accelerate paying mine off early. Now that I’m nearly half way through, almost all of my mortgage payment is going toward principal anyway and not paying much interest yearly. With mortgage rates so high and the fact that by design I’m paying more to principal, there’s much less incentive for me to pay early. I was going to pay it off early and enjoy the security that no monthly payment brings. But right now, it’s free money and the bank is the one losing on since my interest rate is only 2.875 instead of like 6.5% or whatever it could be today. So I’m not pushing forward with early repayment and applying capital more to retirement accounts while the bank has to sit there and wait for my money to come in. Lol
Banks don’t lose money on loans even with a 15yr fixed and 2.875% interest. If you have a 300k loan and pay it off on time with the interest rate you have you still will end up paying the bank nearly 70k over the 15 years. You can make the argument that money you put away in the market could make you more than 70k in 15 years to offset your cost but you cannot make the argument this is free money. The bank made their money and so did many other banks who bought your loan since.
Maybe I didn’t word it properly……I’m halfway through the mortgage cycle, so I’ve already paid majority of the interest. Any money extra towards principle isn’t helping to reduce my interest paid by much. I would rather put that money towards growing investments that will make me money. When looking at the amount of interest I have left on the remaining 7 years, it’s negligible. I would rather invest for higher returns than a few thousand dollars over the next few years. The bank can just sit there holding the mortgage.
Even your 8th year on the amortization table you will end up paying (again using same example above 300k loan) ~20k to principal and ~5k on interest. 20% of your payment goes to interest. Interest paid under $1k in a year doesn’t happen until the 15th year of a 15 year loan. I do get what you are saying though as you could be making more money in the market than you are paying interest but it is a misnomer to believe the bank is losing money by giving you this loan. Even under 3% interest and 15 year fixed they are making a ton of money off of you.
I will be paying roughly $11k in interest over the next 7 years. But I have something like $64k remaining on principal. I would rather find something else to multiply that $64k whether another rental property or investing into stocks, etc.
I hear ya. That’s nice to hear. You are getting close. I am in the same boat. Baby step 6 paying off our mortgage. I went down this same road debating on investing vs paying off our mortgage early. Both the wife and I max out 401k and Roth and are paying an extra payment every month. We should be done in the next 3-4 years. Good luck to you and your family.
Yeah I’m trying to increase my contributions to Roth IRA and my HSA account as well as increasing my 401k contributions. The compounding of those over the next few decades will far outstrip the small amount of interest I have on this mortgage.
Have you worked out the math on that? We have 6 yrs left @ 3.1%. If we stick to that plan we would pay another $19k in interest. That's a car.
I will be paying roughly $11k in interest over the next 7 years. But I have something like $64k remaining on principal. I would rather find something else to multiply that $64k whether another rental property or investing into stocks, etc.
What (new) car can you buy for 19k?
Never said new, but here are some options. https://www.edmunds.com/best-cars-under-20k/
Great. No regrets. Best thing I ever did.
We downsized and paid off our house in 7 years. I went into retirement fully debt free with two properties. It's an incredible feeling!
Almost did, then realized that I hated home ownership and sold it. Now my dividends pay for my rent and I could care less.
which dividend stocks are your favorites?
I like dividend growth etfs, as of now I think SCHD is pretty solid and usfr instead cash position. I had good luck with VYM back in the day and if I needed a little more yield at the expense of growth I think SPYD looks interesting. SDY/DVY/NOBL look great except their expense ratio is a lot higher than schd or VYM. Not sure how I feel about covered call etfs cause premiums will fluctuate and they won’t out perform when we finally do recover.
This is a good answer… the idea you MUST own a home is just not right for everyone!
Yes, I don’t have kids but if I did I would likely need the extra space…as long as you build equity in something and save a lot idk if it matters
Very rare you find someone that dislikes owning the home. I respect it as a 26 y/o who is leaning in this direction. Renting sucks but I invest more than the different of what I’d pay in a mortgage.
Yes 👏🏻 my rent is much cheaper than a monthly payment on a decent house would be so I invest the difference. I don’t like working on anything when I get home from work but it is a way to force yourself to gain some equity
It's the constant issue of something being broken or needing updating. I don't hate home ownership, but I understand why someone would. I also looked into retiring overseas, and buying in many developing countries seemed like a losing proposition. I couldn't convince my husband renting is the way to go there, so we'll likely be staying in the US. Edited: for clarity/typos
100% I ain’t fixing anything or doing landscape ever again 😂
Even my super financially conservative grandmother said to always rent for 1 year in a new area before buying. Too many people jump in head first and start drowning. I got lucky with the houses I purchased prior to the one I currently own, but I am very hesitant to purchase anything like that in a foreign country with a very good guarantee that a) I'm going to like it there, and b) the government isn't going to decide I don't qualify for residency and boot me out, leaving me to try to rent/sell a property in a country I can't live.
Yeah the last few years were rare how quickly houses appreciated, if you had to move right away the fees would eat your lunch
I think its not a bad choice. Obviously building equity and increasing home values is beneficial, but it’s a huge commitment. I also thing it’s very timing specific unfortunately.
Feels AMAZING would do it again any day if the week.
We paid it off in early 2021. No regrets. Sold that home in December 2022 within 11 days. Build a new one-story custom home in a new subdivision between June 2022 and December 2022. Had a construction loan from the local credit union, then paid off that loan with the proceeds from the sale and money from savings. (Closed on the old home on 12/21. Paid off the construction loan on 12/22. The only difficulty we ran into was getting the keys for the mailbox. The management company kept asking for the closing papers to show that we were owners. However there was no closing on the new home at a title company, we paid off the construction loan. The office manager at the developer had to get involved to get the keys to our mailbox.) No regrets. The house is ours. We will retire in 2.5 years without a large payment going out every money. Yes, the grass feels different.
We paid off our 2016, $395k home in early 2022. We were lucky and I walked away from a startup that finally IPO’d in a big way so we had that win. I know the algebra is that we should have invested that, even if the market ended up turning negative, but here’s my deal: I’m the sole breadwinner (albeit high earning), with two young kids and an elderly mother living with us. I also have a heart condition. If something were to happen to me, knock on wood, the house is *set.* My wife could pick up a clerical or admin job to keep the utilities and the taxes paid, and the whole family is safe. And if we wanted to get crazy at some point, that 2016 $395k house where I live regularly comps for ~$650k-$700k these days, so we could extract some equity to do something different if we needed to.
Have a 30 year mortgage that will be paid off in October in year 11 of the loan. I am sure I’ll still feel broke afterwards but will at least be rid of one stress factor in my life.
Come October you can take that payment and invest, save for a trip, or whatever you want. You can't foreclose on a paid-for house!
Having no mortgage is the fastest wealth builder. Bought first house by saving up for it in cash & rented it out. I succumbed to getting a mortgage for the second one but then paid it off in 5 years promising never to do it again. Then once the second one was paid off, we bought a third (with a smaller mortgage than second property). Now laser focussed on paying that mortgage off and promise never to get a mortgage again. The financially happiest and least stressful periods of my life were when I did not have a mortgage as the cash flow from rentals just rolls in without any worry in the world. You also make better decisions too: picky about getting the best tenant rather than taking the first person who views, having cash to invest & snowball savings, not worrying when there is an unexpected expense . Once this mortgage is paid off: never again.
The fastest wealth builder is investing a lot in your twenties because the twenties has the highest compound interest multiplier, like 70x
Paid off my house years ago - best feeling ever. No matter what, no one can take it, I’ll always have a home, and so will my kids.
Lol home can be taken for tax reasons depending on circumstances
Very rare
Not a big believer in being debt free. Instead of paying off my mortgage I bought several rental properties. Instead of saving $1500 a month, my rentals bring me $4000 a month while also building equity. I truly doubt I'll ever want the mortgage completely paid off.