Originally Posted by Oldbabe
Sorry to jump into this thread so late but I wonder if anyone has considered that in future years interest rates will likely rise and your 5.7% mortgage (my rate) payment will be looking pretty good, especially if inflation reigns.
I realize I'm speculating about economic conditions but I'm not alone in my views.
If these conditions prevail, having paid off your mortgage in advance will leave you with less $$$ invested and growing. Not good in inflationary times.
I remember back in the 80's when it was smart to borrow as much as possible! Sometimes I wonder if I will regret paying off my 6.375% mortgage. I think you are making a really, really good point and it's one that I have wondered about.
I paid $798/mo for a $128,000 mortgage that I got in 2002, and paid off in 2006.
$798*12 = $9576, which I guess would be about $13,500 before taxes? At any rate, I'm thinking that at 4%, the size nest egg required to produce that kind of monthly payment would be over twice the $128K amount. Maybe my figures are screwy but even in inflationary times I don't think I could retire if I had to have that much extra in nestegg for 25 more years.
Of course, once I was 79 my house would be paid off so there is something to be said for that.
Also, if I had a lot of money things might look different to me. But really, I don't and the simplicity of no mortgage appeals to me.