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Originally posted by Nathans_Dad
True, but in your model you have to put the 100k into the house in the first place in order to gain $35k to invest over 5 years. If you put the 100K into investments you make over $100k in returns which is much better than $35k isn't it? Again, to each his own.
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The problem I see is your using stock market returns that have a higher risk. I looked at it from a fixed income outlook. That would be closer to the same risk tolerance. I could also by stock on margin or options but the risk is greater. Paying off the mortgage is a guaranteed return.
By paying off the mortgage it allows me to be comfortable with a higher stock allocation.
You just have to look at all the options and decied which is best for you. Just be sure your comparing similar investments. The stock market may have averaged 10% but it could also average alot less in the next 20yrs. You just have no way of knowing.