l just got a little M O N E Y

Zelda,

I'm casting my vote for "investing the money" perhaps in a "low-risk" group of investments - CDs, money market savings, etc. In reading through your post I've concluded that you've done a pretty darned great job of managing your personal finances up until now, and I have no reason to expect that will change.

Evidently the old expert money guru, Dave Ramsey, has never lost his job or been through a layoff. I have been through a layoff three times since I retired from the Marine Corps in 1985 and it's very challenging, especially if you have a family to support.

Eventually becoming "debt-free" should be everyone's goal, but cash is still king! If you pay off that mortgage you've lost the option to use that cash. If you postpone paying off your mortgage and have large unexpected expenses in the future, and we all will, you'll have no cash available to meet those needs.

Your home was built in 2012 and it probably will not have any major expenditure requirements soon. I checked on the mortgage rates and while your current rate is somewhat high, it's acceptable. I am assuming that you are not interested in re-financing for a better rate/shorter term, i.e. going from a 30-year to a 20-year or 15-year mortgage. We went from a 20-year to a 15-year and captured a lower rate. We'll own our home in 11 years and pay a lot less in mortgage interest over the life of the mortgage.

Most mortgage lenders allow you to pre-pay the principal at any time at any rate and at any time that you choose, i.e. pay an additional $10,000/year for the next "X" years.

Your car is relatively new and has low mileage. That's another plus.
 
l am 45 with parents close to 70 in bad health. Being a single parent does not leave time for me or relationships. God and family come first, last, always. Joining the Army after HS caused me to grow up very quickly and 20 years of IT educated me on most life experiences. Just NOT this Money...
 
I like to have $15,000-$20,000 in readily available cash for emergencies. You never know what the future holds. No, I don't stuff cash under my mattress. I do have some cash at home. The bulk of that is in a bank. If you have an emergency fund that you feel comfortable with, then paying off the house is always a good idea. You could then start saving the payments you're making now and investing in something to earn extra income. Or if you aren't already saving for retirement, put some of it away in a 401K or an IRA.

At 45 you still have good earning years ahead of you, but the years will sneak up on you faster than you think. Having a paid off mortgage means never having to worry about the house payment should you lose your job or become ill. Having an emergency fund gives you a good cushion if something unforeseen happens.

Those who would advise you to keep the mortgage as a tax deduction are bad at math. Why would I pay the bank $3-$4 to keep from paying the government $1? I'd rather pay the $1 to the government and hold onto the other 2 or 3 bucks.

Similarly, I wouldn't keep a mortgage in order to invest in other things. Think of it as borrowing against your home to buy stocks. It's just not worth the risk in my book.
 
Pay off the house. Paying interest is money thrown away. I always figured if a financial expert was so smart why is he wanting to handle my money for a per cent. If he is smart enough to handle money and make a profit he would be so busy handling his own money and keeping all the profit that he wouldn't have time for anyone else. Larry
 
An "investment advisor" makes nothing until you buy or sell something he "advises". Not knowing the rate of interest on your mortgage I still say pay off your mortgage.
 
Zero % of paid for homes are foreclosed upon by the bank. You still have to pay those property taxes though, so the 'man' still has you somewhat. But I'd pay the house off first and figure out other investments with income.
 
TX-Dennis said:
Those who would advise you to keep the mortgage as a tax deduction are bad at math. Why would I pay the bank $3-$4 to keep from paying the government $1? I'd rather pay the $1 to the government and hold onto the other 2 or 3 bucks.

Similarly, I wouldn't keep a mortgage in order to invest in other things. Think of it as borrowing against your home to buy stocks. It's just not worth the risk in my book.
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More good advice. Larry
 
Honestly, you're seeking financial advice on a gun forum. Would you ask a stock broker if you can shoot +P in your Model 10?

I've been with the same financial advisor for 15 years. Yes, he charges me for his involvement, but he makes more if I make more and we both seem to be doing quite well. Consider scheduling a consultation with a financial service, like UBS.
 
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It's been real nice not having a house payment for the last 20 years.
 
If it is a really substantial amount, Find an accountant you can trust and get a good attorney. They will more than pay for themselves.

regards

yashua
 
Vote for pay off house.
Taxes are inevitable.
Chance to be debt free on mortgage - rare.
Relationship advice. Can't give any....
 
I cannot adequately describe the feeling of freedom that comes with being debt-free. You just have to experience it to understand it.

Pay off the mortgage. What you are now paying in mortgage payments can be put into good investment plans, and you won't miss it because you are used to paying it out. So just pay it to yourself instead of the bank or mortgage company.
 
Ask any advisor if he knows of an investment that is absolutely guaranteed to return 4.5%. Ask if the investment has no risk what so ever. If he says no, then, pay off your mortgage.

That is what you get when you pay off a loan. If you don't pay interest, you are ahead of the game by the amount of interest you don't pay. And the gain of not paying interest is truly risk-free.

Having said that, it would be a good idea to have an emergency fund of six months of wages in an account that has no early withdrawal penalty.
 
I am not a financial adviser. But, I am debt free and own my home outright. It is a very good feeling and gives me a lot of freedom. You can always invest with your income that is free from mortgage payment. With your pension you have a nice security net and medical.

CONGRATULATIONS
 
I cannot adequately describe the feeling of freedom that comes with being debt-free. You just have to experience it to understand it.
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Ray is 100% correct on this. I finally was able to experienced this about 15 months ago. Very few, if anything thing, feels better than being debt free.

Zelda, you sound like a level headed person. You go girl.
 
I'm not an accountant or financial professional in any way. So take this with a grain of salt.

I'm an advocate for paying off the mortgage. But admittedly I'm biased - because that is what we chose to do.

Don't forget: You're getting the ability to deduct the MORTGAGE INTEREST paid from your TAXABLE INCOME. So the farther into your mortgage (number of years) you are the LESS that deduction becomes - because over time more and more of your payment goes to principal.

When looking at how much your actual tax bill (total dollars) gets reduced compared to what you could do with that mortgage payment using it for other things, I just don't see how you come out ahead - unless you just got a brand new mortgage and the majority of your payment is interest. This is how I see it: Let's say you pay $1,000 for your mortgage. That's $12,000/yr. Let's say 20% is interest. That's a $2,400 deduction in taxable income. If you're in the 25% tax bracket your tax bill will be reduced by $600.

If that logic is right (I'm not sure that it is) you paid $12,000 for the right to reduce your actual tax bill by $600. Or.........you could actually have $12,000 at the end of the year because you didn't have to pay your mortgage.

Additionally, there is something positive on the mental side that comes from having it paid off. It's a freedom that is hard to describe - PLUS you get to see your savings grow because you're not making that payment.

OR
 
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BigBill said:
I can understand no drama needed. But a companion to share a ice cream, walk the dog, watch the fireplace and snuggle, cuddle up, with a bowl of popcorn. Maybe share breakfast out or dinner. I think a companion is perfect. For her. No drama, no frills.
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For me, that perfect companion has fur and doesn't talk back. :)
 
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