Spouse Insistent on Paying Mortgage Off Early

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Do NOT pay off mortgage early. If he wanted a shorter mortgage, he should have requested a shorter term. We just paid off a 15 year old mortgage, which comes with far less interest than a 30 year. If you pay off a 30 mortgage early, you're still paying more interest. It negates all the benefits of having that longer term.

Invest the money in the stock market instead. Apple, Nvidia, Microsoft, Alphabet (Google), Netflix, Meta. Maybe not Tesla.

Awful advice. First, if they pay it down faster, all amounts over the regular monthly amount come straight off principal, so it's wise to do so.

Second, investing in a handful of stocks is highly risky because it's not diversifying. Most of those stocks have really high P/E ratios too = potentially overvalued.

PP you replied to. I stand by what I said. You don't seem to understand that "the regular monthly amount" is made up of more interest than if you'd chosen a shorter-term mortgage! So they're making you pay the interest first anyway.

Picking a shorter term mortgage and not paying it in advance has worked well for me. I'm 100% in stocks I hand-picked myself and that has led to a rapid wealth accumulation. But beyond anecdotal data, the math is sound. We can talk about a stock market bubble if you want, but personally, I think stock market investment is still the way to wealth.

Different poster here. This is completely wrong. If you have a 30 year mortgage and pay more than the minimum monthly payment, the additional comes from principal, not interest. Interest rates may be slightly lower for a 15-year mortgage, but many borrowers might prefer the flexibility of getting a 30 and deciding whether to overpay, vs locking into the higher payments over 15 years.

I have a 15 year mortgage, but it can make financial sense to get a 30 year.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Is the paid-off rental something you would not mind living in yourself? If not, i agree with your spouse. It makes good sense pay off your current home while you can. You never know what the future holds, job loss or illness.

So much this. When you are in your 20s and 30s and employed and healthy and things are going well, it’s easy to feel like you will be able to keep going like that indefinitely.

I’m in my upper 40s now and if I were laid off, I don’t think I could find a job paying close to what I make now. And I just don’t have it in me to hustle again like I did to get where I am. Having my house paid off would be so much better and allow me to weather storms. And the storms are looking likely and severe at this time.

Money is money. Weathering storms with a $500K mortgage paid off, or alternatively $500K+ additional money in various low-yielding, but low risk investments? I'm not sure number one is preferable.

We have enough in an emergency fund to cover expenses for at least a year.
Well one definately is preferable. Unless you already have a 12month+ emergency fund, you don't pay off the mortgage. So that the money is liquid and easily accessible. You cannot tap into your home if you are unemployed---nobody will let you remortgage the home or setup a Home equity line then. So while yes, paying of the mortgage is freeing (I haven't had a mortgage for almost 15 years), I didn't pay off our first home until we had 10x what the mortgage payoff was outside of our retirement funds (with 6-9 months in EF/easily accessible cash).

[Anonymous]

Anonymous wrote:My husband is obsessed with paying our mortgage off early and I have been unable to convince him that this is a sub-optimal financial decision. He hates the idea of paying interest and is allergic to debt. Our mortgage rate on our home is only 5% but he would rather contribute to paying our mortgage off early instead of investing more in our retirement accounts. Just for context here is a summary of our financial situation. We are in our early 30s and our total NW is around 1.1M. We have 240k in retirement accounts and we are contributing a combined amount of around 36k a year to our retirement accounts. We own 2 rentals, one is paid off and the other rental has a sub 3% mortgage on it. Our total income is around 250k per year. Basically the disagreement is that he would prefer to pay off our mortgage by 2035 and I would prefer to max out our 401k's. What should I do, just give in and pay off the mortgage early or double down on 401k contributions?

I think it’s fine paying down your 5%!mortgage if it makes your husband feel good about being debt free. Now, if you had a 2.5% mortgage, I would give a different advice.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Do NOT pay off mortgage early. If he wanted a shorter mortgage, he should have requested a shorter term. We just paid off a 15 year old mortgage, which comes with far less interest than a 30 year. If you pay off a 30 mortgage early, you're still paying more interest. It negates all the benefits of having that longer term.

Invest the money in the stock market instead. Apple, Nvidia, Microsoft, Alphabet (Google), Netflix, Meta. Maybe not Tesla.

Awful advice. First, if they pay it down faster, all amounts over the regular monthly amount come straight off principal, so it's wise to do so.

Second, investing in a handful of stocks is highly risky because it's not diversifying. Most of those stocks have really high P/E ratios too = potentially overvalued.

PP you replied to. I stand by what I said. You don't seem to understand that "the regular monthly amount" is made up of more interest than if you'd chosen a shorter-term mortgage! So they're making you pay the interest first anyway.

Picking a shorter term mortgage and not paying it in advance has worked well for me. I'm 100% in stocks I hand-picked myself and that has led to a rapid wealth accumulation. But beyond anecdotal data, the math is sound. We can talk about a stock market bubble if you want, but personally, I think stock market investment is still the way to wealth.

Different poster here. This is completely wrong. If you have a 30 year mortgage and pay more than the minimum monthly payment, the additional comes from principal, not interest. Interest rates may be slightly lower for a 15-year mortgage, but many borrowers might prefer the flexibility of getting a 30 and deciding whether to overpay, vs locking into the higher payments over 15 years.

I have a 15 year mortgage, but it can make financial sense to get a 30 year.

Yes. Years ago with my first 30 year mortgage, I sometimes received unexpected financial windfalls of around d $20,000. Putting the windfall on the principal the first year of the mortgage saved me a decade of interest, since at the beginning most of the monthly payment is interest. If you don't understand this, look at your amortization schedule.

[Anonymous]

Anonymous wrote:I paid mine off earlier this year. And I’m so glad I did. Furloughed since 10/1 and no guarantee back pay will come. Peace of mind can’t be understated.

So all that money would have just disappeared if you didn't pay off your mortgage?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Do NOT pay off mortgage early. If he wanted a shorter mortgage, he should have requested a shorter term. We just paid off a 15 year old mortgage, which comes with far less interest than a 30 year. If you pay off a 30 mortgage early, you're still paying more interest. It negates all the benefits of having that longer term.

Invest the money in the stock market instead. Apple, Nvidia, Microsoft, Alphabet (Google), Netflix, Meta. Maybe not Tesla.

Awful advice. First, if they pay it down faster, all amounts over the regular monthly amount come straight off principal, so it's wise to do so.

Second, investing in a handful of stocks is highly risky because it's not diversifying. Most of those stocks have really high P/E ratios too = potentially overvalued.

PP you replied to. I stand by what I said. You don't seem to understand that "the regular monthly amount" is made up of more interest than if you'd chosen a shorter-term mortgage! So they're making you pay the interest first anyway.

Picking a shorter term mortgage and not paying it in advance has worked well for me. I'm 100% in stocks I hand-picked myself and that has led to a rapid wealth accumulation. But beyond anecdotal data, the math is sound. We can talk about a stock market bubble if you want, but personally, I think stock market investment is still the way to wealth.

Different poster here. This is completely wrong. If you have a 30 year mortgage and pay more than the minimum monthly payment, the additional comes from principal, not interest. Interest rates may be slightly lower for a 15-year mortgage, but many borrowers might prefer the flexibility of getting a 30 and deciding whether to overpay, vs locking into the higher payments over 15 years.

I have a 15 year mortgage, but it can make financial sense to get a 30 year.

Yes. Years ago with my first 30 year mortgage, I sometimes received unexpected financial windfalls of around d $20,000. Putting the windfall on the principal the first year of the mortgage saved me a decade of interest, since at the beginning most of the monthly payment is interest. If you don't understand this, look at your amortization schedule.

It doesn't matter if you have a 15 or 30 year mortgage. Every single monthly payment calculates interest as current balance x interest rate / 12. The reason you pay more interest early is because the balance is higher. The reason you pay more interest on a 30 year loan is because you pay off the principal lower so the balance remains higher for longer.

[Anonymous]

I bought my first home in March 2000 and we put extra towards mortgage each month and mortgage was done by 2010.

Starting 2011 I put the "mortgage payment" amount in the Fidelity Account each month.

I had to relocate for work in 2019 and had to buy another house in another state and carried two houses for 18 months which was easy as first home had no mortgage.

There is not a right answer. I most likely would have done better not paying off mortgage earlier and did all stocks. However, my wife only felt comfortable doing more stocks when there was no mortgage. If I got laid off at same time stocks are crashing less of a issue.

I am doing same now. Took out a 30 year mortgage at 55 when relocated. Paying enough extra each month so done at 70 instead of 85.

BTW buying stocks from 2008 to 2023 was a no brainer. But right now in 2025 they are pretty prices and although of course they will go up long term a 10-15 percent sell off would not be suprising.

[Anonymous]

Pretty simple math problem but more of a relationship issue.

Would suggest a compromise. Let DH defer putting money into his retirement accounts and use the money to pay off mortgage early.

You keep investing for your future. Given life expectancy projections a win-win for you and given this reduces his stress he may be around longer as well.

[Anonymous]

you should definitely max out your 401ks

[Anonymous]

My spouse is more inclined to borrow the maximum mortgage amount until his death. It stressed me out for a long time because the mortgage amount is disproportionate to my income, so if something were to happen to him, I'd be in a tough spot. I eventually created a separate savings account to ease my axiety, and the account has done well. I think I like the solution better than paying off the mortgage. I could float the mortgage for a long enough period to sell, even in a bad market, if needed, but I have more flexibility having the money liquid than tied up in a house.

[Anonymous]

We just recently paid off our mortgage and with the unrest that's happening right now in our country. I am thrilled to have full ownership of my house.
We kept the 30 year loan but paid it off in 17 years. As another poster mentioned every overpayment you pay goes 100% towards principal. And as the principal goes down, so does the interest.
I am team pay off your mortgage. There's nothing more free than know that you own your house outright and a bank cannot take it away from you.

[Anonymous]

Anonymous wrote:We just recently paid off our mortgage and with the unrest that's happening right now in our country. I am thrilled to have full ownership of my house.
We kept the 30 year loan but paid it off in 17 years. As another poster mentioned every overpayment you pay goes 100% towards principal. And as the principal goes down, so does the interest.
I am team pay off your mortgage. There's nothing more free than know that you own your house outright and a bank cannot take it away from you.

Same. But we did it in 19 years. Very happy with our decision. Of course, if we weren't fully employed the calculus might be different.

[Anonymous]

I’m with your husband. I want my home paid off. Peace of mind.

[Anonymous]

Right now my goal is as follows.

Get home paid off. Get repairs needed and new roof and fix cement work so house is in perfect shape, cars are paid off but I have some over due maint on one with struts and brakes.

there is a peace of mind have a paid off home, in good shape with no big repairs needed and paid off cars in good shape. if you lose your job so less stresful.

But investing in stocks is better choice. however, losing job in a bear stock market on a home with a big mortgage and a 30 year old roof about to go and two car loans is not good