[onewhippedpuppy]

Originally Posted by DARISC

Right.

Rough figures, If you owe $100k @ 5% on your house, that $100k that you've borrowed is really only costing you about 3% after you write the interest off your taxes, i.e., your mtg. is effectively at 3%.

So, if you have $100k in investments paying 5% and you use it to pay off your $100k mtg,, which is really at 3%, you're losing 2%, maybe more, depending on your tax situation.

I think a lot of people don't realize this or don't care because it's psychologically comforting to them to have their house paid off.

True, but.......... If you lose your job, you can quit paying into your investments. You can't quit paying your mortgage. Would you borrow against your house and use that money for investing? Because by not paying off your mortgage, that's essentially what you're doing. Not saying that your approach is wrong, but there's some risk involved.

There's a reason why those who are debt free sleep better at night.