Generally, I wouldn't pay off a 4% mortgage. It wouldn't make financial sense for me. I have enough deductions that I itemize, so mortgage interest is a whole lot cheaper than the mortgage rate. Even if you can't itemize, you can do better than 4% on your investments now even in cash. Under current law, the standard deduction will be cut in half in 2026 and the marginal rates will increase. This would make the interest deduction much more attractive than it is now. So for those reasons, I wouldn't use your other assets to pay off the mortgage. If you would be selling appreciated funds in your taxable account to pay off the mortgage, that would be a huge tax hit. So just from a numbers standpoint, I think paying off that mortgage right now would be a poor move.
Psychologically, I understand the desire to be debt free when you retire. Only you can decide is that peace of mind is worth the financial cost.
Psychologically, I understand the desire to be debt free when you retire. Only you can decide is that peace of mind is worth the financial cost.
Statistics: Posted by WeakOldGuy — Mon Oct 21, 2024 12:57 am — Replies 3 — Views 117