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Reply to "What Should I do? Aggressively payoff Home Mortgage or Invest the Money in a Mutual Fund??"
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[quote=Anonymous][quote=Anonymous]The tax deduction you get on the interest paid is still less than the actual dollars paid in interest. Zero paid is better than x% of interest as a deduction. [/quote] This is a non-sequitur. Obviously the tax deduction doesn't cancel out the interest. But it affects whether paying down a mortgage or investing in the market is a better choice. Your market returns don't need to beat the interest rate on the loan, they need to beat the interest rate on the loan [i]minus the tax savings from paying that interest[/i]. That means a market return lower than the interest rate still pays off better than paying down the loan.[/quote]
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