Home
Forums
New posts
Search forums
What's new
New posts
Latest activity
Members
Current visitors
Log in
Register
What's new
Search
Search
Search titles only
By:
New posts
Search forums
Menu
Log in
Register
Install the app
Install
Home
Forums
The Competition
FedEx Discussions
Pay Off Mortgage?
JavaScript is disabled. For a better experience, please enable JavaScript in your browser before proceeding.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an
alternative browser
.
Reply to thread
Message
<blockquote data-quote="Artee" data-source="post: 5643962" data-attributes="member: 24351"><p>The problem is everyone situation is different. You assumed this person had a 10 year mortgage. Most people have a 30 year mortgage and the beginning balance is going to be much higher than $120k. Therefore the P&I is going to be higher.</p><p></p><p>You example is very simple. All you are looking at is interest. You are ignoring the $1160/mo investment every month for 10 years that the person would be making by not having a mortgage now. There is also more that can be taken into account, but that will vary upon person to person and their situation.</p><p></p><p>if you pay off mortgage and invest that $1160/mo for 120 months @5% you will end up at $173k.</p><p>If you don't pay off mortgage and put $120k into an investment that will pay you 5% for 120 months you will end up at $182k</p><p>So you made $9k more over the 120 months for an average of $75/mo</p><p>Now you have to subtract out the $19k in mortgage interest you had to pay</p><p>Suddenly I am better off by $10k. The gap would be even wider because the mortgage amount would have been even higher meaning the $1160 monthly investment would be more and the interest would have been more than $19k.</p></blockquote><p></p>
[QUOTE="Artee, post: 5643962, member: 24351"] The problem is everyone situation is different. You assumed this person had a 10 year mortgage. Most people have a 30 year mortgage and the beginning balance is going to be much higher than $120k. Therefore the P&I is going to be higher. You example is very simple. All you are looking at is interest. You are ignoring the $1160/mo investment every month for 10 years that the person would be making by not having a mortgage now. There is also more that can be taken into account, but that will vary upon person to person and their situation. if you pay off mortgage and invest that $1160/mo for 120 months @5% you will end up at $173k. If you don't pay off mortgage and put $120k into an investment that will pay you 5% for 120 months you will end up at $182k So you made $9k more over the 120 months for an average of $75/mo Now you have to subtract out the $19k in mortgage interest you had to pay Suddenly I am better off by $10k. The gap would be even wider because the mortgage amount would have been even higher meaning the $1160 monthly investment would be more and the interest would have been more than $19k. [/QUOTE]
Insert quotes…
Verification
Post reply
Home
Forums
The Competition
FedEx Discussions
Pay Off Mortgage?
Top