Pay Off Mortgage Faster – or Invest?

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good comment by Stephen regarding financial-aid eligibility. have read an awful lot of personal-finance articles & can't recall ever seeing the idea of "hiding" your assets in your house. definitely worth consideration. thanks!

Suzanne of NC 1:17PM July 16, 2010

If you have sufficient funds buy the dream home you are looking at, there is no point in getting a mortgage and then paying interest on the mortgage. I purchased the house just by paying off in full and today i absolutely have no regrets. You can put the mortgage money in high yielding saving account and get interest which will help you in maintaining your house.

Suresh of NJ 1:00PM July 16, 2010

If you want to make 8% in the stock market you will need to live a very, very long time. 8% is the return over 100+ years. Most of us will never see that in our lifetimes. If you bought an index fund in 2000 you haven't made any money in the last 10 years. People who bought an index fund in 1964 and planned to retire in 1982 didn't make any money in 18 years. I have a 30 yr fixed rate mortgage which I will pay off in 15. I will be debt free at age 51. Having no mortgage will be like getting paid an extra $2000 a month until I retire.

Doug of CO 12:46PM July 16, 2010

Wise advice. How would you feel if you owned your home outright? Most people say "great" so why not make paying off your mortgage your first and best investment? A high guaranteed return, peace of mind, financial flexibility. Making just one extra payment per year cuts down the length of your mortgage by 5 - 10 years, depending on your rate. And it's a good college savings plan. Schools will ask you how much you've saved, and likely deduct this amount from your financial aid eligibility. They won't ask about the equity in your home. Plus you can then borrow against your home to pay for college and make this a tax deductible expense. Or just pay it out of pocket if you've paid your mortgage off. Such a deal.

Stephen Campisi of CT 11:59AM July 16, 2010

Let's see, so I'm an American consumer. That means get married when I'm really young, have a bunch of kids right away, buy a big house and drive a car that I can fit everyone into (a van or an SUV). And we all have to have cellphones and our own flatscreens and computers, and video games, and I need to eat and drink like there's no tomorrow (did you ever really look with unbiased eyes at what a "supermarket" looks like? It's astounding. If you ate up what you were told when you were little about what you needed to have to be a part of "society" then you now have what you deserve. Abject fear. And it's not Obama's or Dubbya's fault. It started long before either of 'em. Why, consumerism and sales.... it's the American way! Look! The whole world wants to be like us!

Notyourbusiness of HI 2:34PM July 14, 2010

If one plans to move or sell the house in the near future ( 1-5 years), assuming the mortgage is in the initial 1-8 years, it makes more sense to pay it off, since most of the monthly payments are applied towards the interest and only small portion is applied to the principal...

dan aurellio of GA 12:14PM July 08, 2010