I am curious if it is better long-term to pay a mortgage off 10 years early (thus saving thousands in interest) or invest more in an IRA.
Basics about our finances: We are in our late 30’s, have IRAs, a 529 for our daughter, 10K of savings (2k in a savings attached to our checking, 8k in an external high-yield account), we pay extra toward our car payment so it’ll be paid off next year, and for 3 years (from getting the mortgage to getting the car) we paid extra towards our mortgage to the extent that if we continue that extra amount it’ll be paid off 10 years early. For the next year, and since summer 2020, the extra we had previously put towards the mortgage is going to the car, since it has the higher interest we want to knock it out. Once that’s gone we were planning to resume paying the extra to the mortgage. Car loan interest is 4.5%, $11k left, mortgage is 2.75%, $237K left.
Once the car is paid off, would it be better to put the extra back towards the mortgage and pay it off 10 years early (thus saving thousands in interest) or to put the extra in an IRA for retirement?
Submitted February 20, 2021 at 07:55PM by Aphrilis https://ift.tt/2NG6k2e
