Another mortgage pay off question

[Anonymous]

If you owed around $900k (on a house valued around $3m) with a 30 yr mortgage/2.25% fixed, would you pay it off?


The money would come from sale of stocks. Spouse thinks we should, I'm wondering if it should stay in investments. Money is stocks currently is significantly more than the payoff amount, so not sure if matters too much either way.

[Anonymous]

I would because I hate being in debt.

[Anonymous]

I can’t think of one reason why I would pay off this low mortgage.

[Anonymous]

Anonymous wrote:I would because I hate being in debt.

That's not really a reason from a financial perspective.

[Anonymous]

No. Not at 2.25%.

[Anonymous]

Money is clearly not an issue for you. Pay it off to get some peace of mind.

[Anonymous]

lets do some math here:

If you open a 900k mortgage for 30 years you will have paid a total of 1,228 M for it (with interest) after 30 years

If you left 900k in stocks for 30 years you would have 5.16M (at a 6% return)

so ask yourself.... why on earth would I pull money out of stocks to pay off my mortgage?

[Anonymous]

We off our 5.5% mortgage really quickly some years ago. I don’t regret it.

In your case, if you want the peace of mind of a “paid off house,” I would build up a bunch of FDIC-insured CDs that are paying about 5 or 6%. When that number matches your mortgage balance, consider your house “paid off,” but keep it in the CDs. You can even use half the CD interest to actually make the monthly payments.

I totally get the feeling of security. It is VERY nice. But so is math.

[Anonymous]

Absolutely not!! That's free money and you'll have to pay taxes on the gains from sale of stocks.

[Anonymous]

Anonymous wrote:Money is clearly not an issue for you. Pay it off to get some peace of mind.

If money is not an issue, there is already peace of mind.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I would because I hate being in debt.

That's not really a reason from a financial perspective.

We just love debt in this country. I don't care if I have a 0.5% mortgage rate, If I can pay it off I would.

[Anonymous]

You will be taxed on the capital gains from the sale of the stocks.

[Anonymous]

NO.

My God. Why do people have no understanding of math at all?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would because I hate being in debt.

That's not really a reason from a financial perspective.

We just love debt in this country. I don't care if I have a 0.5% mortgage rate, If I can pay it off I would.

As long as you know that is an emotional decision, have at it.

Looking at it mathematically, that’s an awful choice.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Money is clearly not an issue for you. Pay it off to get some peace of mind.

If money is not an issue, there is already peace of mind.

That's not how it works for some people.