Reply to Best financial planning tip for donut hole families

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]When our oldest was in late elementary school, we did the math and realized that our house would be paid off when he was in his 3rd year of college. By adding just a bit to each monthly payment, we accelerated it so that it was paid off halfway through his senior year of high school. That is freeing up a ton of cash flow during his college years. [/quote]

So you paid off the 3% mortgage instead of putting it into investments that could earn a lot more than 3%. Yay![/quote]

Yes and the price we paid for college dropped from 95k to 35-45k per kid for 8 years. Yay indeed. [/quote]

What the PP is saying is that you could have put the extra payments made towards the mortgage into a 529 that grew at more than 3% per year and with tax free gains.....meaning you would likely be better in the long run (when they both ended college).  That said - glad this plan is working for you (genuinely). (I also say this as someone who paid off their mortgage early vs investing that money to get higher gains in market compared to savings on mortgage debt rates. It's just nice to have it paid off...but financially we'd have been better off no paying the mortgage down.) [/quote]

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