Should You Pay off Your Mortgage?

This is a question that many home owners ponder.

My simple response: if the cost of your mortgage  (which is the interest rate) is less than the return you would make from investing that money than you should invest the money instead of using it to pay off your mortgage.

However, there is more that needs to be taken into consideration with a decision like this. It depends on your personal situation, the things that you value, and your ultimate goal.

Below are some things to consider when coming to your decision:

Scenario	Costs	Benefits
Pay off your mortgage asap	Large sums of money going towards paying off your mortgage instead of putting that money into an investment that would make you a higher return than the cost of interest you’re paying to have your mortgage Can no longer benefit from the mortgage interest tax deduction.	Peace of mind in having no debt on your home and the ability for the bank to take it from you in hard times One of the largest of your monthly expenses will be knocked out
Pay the minimum monthly payment	Cost of interest paid on the mortgage Having a lien on your home and the ability for the bank to foreclose if you run into hard times On-going monthly expense to worry about	Ability to use that money to put into another investment that will get you more return on your money. This could result in quicker increases of passive income or wealth creation You can benefit from the mortgage interest tax deduction

Ultimately you must weigh the costs and benefits of the situation and decide which benefits are more valuable to you.