Pay Off the 30-Year Mortgage Early or Invest?

Our first question of the month comes in from Patrick from California:


Hey Andy, can I pick your brain real quick about paying off your mortgage?

I just bought a house here in San Diego and got a 30 year fixed on it. 

If I wait 30 years to pay it off, I will have paid $162,000 in interest which doesn’t sit very well with me.

What was your reason for paying off your mortgage?  

I was thinking instead of making extra payments on the principal that I would instead invest that money. After 8-10 years I would have amassed enough to pay off the mortgage in a lump sum.

What are your thoughts on that? Invest the money or pay off the mortgage?  

My reason to accelerate paying it off is that: 

1. I hate debt  

2. Lower my monthly expenses after loan is paid off  

3. Save at least $100K in interest payment

Many thanks bro!

Patrick 


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Investing in Rental Real Estate with Cold Hard Cash – with Peter Aquart

Real estate investing has been something I’ve been interested in for a long time. The ability to own a home that provides a monthly passive income and grows in value at a consistent rate over time sounds quite appealing to me.

I don’t get as excited about flipping properties because it sounds like that’s a very detailed and focused skill. The margins are so tight that you need to be a master at your craft to succeed. Evidently, those well-produced HGTV home flippin’ shows make it look easier than it actually is.

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