Jonathan Pond, a financial planner and author of Grow Your Money! 101 Easy Tips to Plan, Save, and Invest, argues that you need to be in the 35 percent tax bracket, or make at least $350,000 annually, for the tax break to be worthwhile. Most Americans in the 25 percent tax bracket might pay, say, $10,000 in mortgage interest but save only $2,500 in taxes.
Look at the emotional aspect. Some 16 percent of workers and 10 percent of retirees think making mortgage payments or paying for a house is the most pressing financial issue facing Americans today, according to an Employee Benefit Research Institute survey done this year. But knowing that you own your home can give you a sense of stability in retirement—security that the possibility of stock market gains will never be able to. "Paying off the mortgage is going to reduce their need for cash flow when they go into retirement," Hayden says. "I just think people ought to get out of debt because times are so uncertain, and the less they are shackled, the better they are going to be able to deal with whatever their problems are going to be."