Fantasy Football - Footballguys Forums
dorno

What's your age and the value of your 401k?

Recommended Posts

3 hours ago, Otis said:

Thanks. My gut tells me to do this. 

Paying off the house would feel so satisfying and would reduce a lot of stress.   Not sure it is the best financial move but it is a great one.   

  • Like 1

Share this post


Link to post
Share on other sites
2 hours ago, KCitons said:

 

Stress is also relative. 

This is the most important part.

As evidenced by how many times Otis has referenced paying off the mortgage or investing, it seems rather obvious the best path for HIM is to go after the mortgage 

  • Like 1

Share this post


Link to post
Share on other sites
15 minutes ago, DocHolliday said:

Paying off the house would feel so satisfying and would reduce a lot of stress.   Not sure it is the best financial move but it is a great one.   

In his position he doesnt need to try and make the "best" financial moves, but rather he should make sure he makes GOOD financial moves, or "not bad" financial moves.

Paying off your mortgage is a "not bad" financial move IMO, especially in his position.

  • Like 1

Share this post


Link to post
Share on other sites
3 minutes ago, ghostguy123 said:

This is the most important part.

As evidenced by how many times Otis has referenced paying off the mortgage or investing, it seems rather obvious the best path for HIM is to go after the mortgage 

Correct. But, if I remember correctly, he also stresses over paying huge amounts for his daughter's weddings. Amounts that would make up large chunks of our retirement accounts.

Share this post


Link to post
Share on other sites
3 minutes ago, KCitons said:

Correct. But, if I remember correctly, he also stresses over paying huge amounts for his daughter's weddings. Amounts that would make up large chunks of our retirement accounts.

Pay off mortgage....."oops, not enough to pay for wedding sweety"

  • Laughing 2

Share this post


Link to post
Share on other sites

With my retirement accounts far ahead of schedule the thought has crossed my mind to just do the match and use the surplus to pay down the mort.  I'm actually shocked I don't see more people suggesting such a thing.  

  • Like 1

Share this post


Link to post
Share on other sites
1 minute ago, culdeus said:

With my retirement accounts far ahead of schedule the thought has crossed my mind to just do the match and use the surplus to pay down the mort.  I'm actually shocked I don't see more people suggesting such a thing.  

Well, a lot of people probably have really good rates on their mortgage and you can never get that compounding effect with retirement account back if you skip it now. 

Share this post


Link to post
Share on other sites
14 minutes ago, ConstruxBoy said:

Well, a lot of people probably have really good rates on their mortgage and you can never get that compounding effect with retirement account back if you skip it now. 

Yeah, but the pots of money are different.  I can't just stroke a check off the 401k for the balance.  Even if I just took the minimum and invested it given the RFROR% in paying down the mort that still is an option.  

At some point you look at the money you will have in 20 years and see that it is clearly fine, and wonder about the 20 years till then.

This thought process came when I was considering just doing Roth401k which is after tax money, then thought why the #### do I need to push this off.  I'm more than fine at this point.

Share this post


Link to post
Share on other sites
Posted (edited)
26 minutes ago, culdeus said:

Yeah, but the pots of money are different.  I can't just stroke a check off the 401k for the balance.  Even if I just took the minimum and invested it given the RFROR% in paying down the mort that still is an option.  

At some point you look at the money you will have in 20 years and see that it is clearly fine, and wonder about the 20 years till then.

This thought process came when I was considering just doing Roth401k which is after tax money, then thought why the #### do I need to push this off.  I'm more than fine at this point.

As with Otis, the answers depend on the individual. The bolded shows that you have the means to do it and still feel safe for retirement, so it's probably a good choice for you. I would think based on the last several pages of this thread that most people do not feel fine for retirement at this point, so probably would be better off putting it in retirement accounts. 

 

ETA: You did say in your first post that your retirement was fine. I missed that part of your question. 

Edited by ConstruxBoy

Share this post


Link to post
Share on other sites
47 minutes ago, culdeus said:

With my retirement accounts far ahead of schedule the thought has crossed my mind to just do the match and use the surplus to pay down the mort.  I'm actually shocked I don't see more people suggesting such a thing.  

Otis's situation is different. He's getting a year end bonus. It's not taking away from his retirement contributions. It's kind of "found" money. Assuming he's maxing his other retirement contributions, paying the mortgage down is the bonus. 

  • Like 1

Share this post


Link to post
Share on other sites
Posted (edited)
17 minutes ago, KCitons said:

Otis's situation is different. He's getting a year end bonus. It's not taking away from his retirement contributions. It's kind of "found" money. Assuming he's maxing his other retirement contributions, paying the mortgage down is the bonus. 

It’s partly a year end bonus, but partly my regular comp, about half of which I get at year end.  Though I don’t think it matters for purposes of the point you’re making. 

Edited by Otis
  • Thanks 1

Share this post


Link to post
Share on other sites

@Otis

I am solidly in the “pay off the mortgage” camp. I haven’t had a mortgage for over 7 years now, and the peace of mind it brings outweighs any potential gains you may be missing. We’ve even paid off the mortgage on our vacation home, and it feels great.

Everyone’s situation is different, but knowing that I have a place to live if everything goes to hell - I’ll take that.

  • Like 3

Share this post


Link to post
Share on other sites

I guess if you are on track with your retirement number, and you are 100% sure your current home is where you are going to be for the vast majority of your life, paying down the mortgage may be a good thing.

For me at this stage of my life, I can think of other higher priorities than paying down my mortgage.

With two teen-aged kids off to college within the next 4 years, I am not sure my wife and I will stay where we are in the PNW. Both of us are East Coasters, almost all of our entire families (including two sets of aging parents) are back there, and if the kids end up going east to college, I don't see what holds us to this area of the country.

Another consideration is that given the rise in value of our home, we have some pretty solid equity built up just from rising house prices. We bought with 25% down but our equity is now over 65% of the house's value .

I'd rather sink money now into other retirement investments (IRAs) and putting as much money as I can into my sons' 529 plans -- in addition to ensuring I am setting as much as I can aside to help pave the way for a comfortable retirement and ensure my wife is taken care of until the end of her life (no doubt she is going to go long after I do), my other goal is funding 100% of my kids' college tuition, room and board.

Enabling them to be debt-free out of college is one of the best ways I can think of to set them up for success as adults.

This may mean we end up with a mortgage for the foreseeable future, maybe into retirement if we remain in a HCOL area. I think my strategy is likely going to be to downsize at the right time to the right MCOL (or LCOL) area, using the equity we continue to build up (in our current and future house) to buy our retirement pad sans mortgage. 

  • Like 1

Share this post


Link to post
Share on other sites
Posted (edited)
11 hours ago, Otis said:

Into a big chunk of cash at year end.  Going to set aside a piece of it for some improvement projects this year, and another piece for liquid/checking account/rainy day. Do I take the big chunk left over and pay down the mortgage, which is my final albatross?  Or dump it into the stock market?  Or split it and do both?

With everyone thinking we have a dip in the economy coming soon, doesn’t feel like a great time to dump into the stock market.  I’m also really wanting badly to make our mortgage disappear (Mortgage is a jumbo at 3.625%), and if I dump the whole thing into the mortgage, and so the same for the following 3 years, I should be able to pay it off entirely. Year 5 it’ll all be mine, and that’ll just be such an incredible feeling.  I’ll walk to work that day feeling like I have a suit of armor, and when something hits the fan, the anxiety I take home with me regularly will be greatly diminished knowing I could walk away for a lifestyle job at any time. 

Thoughts?  

I would split between mortgage and investments. Not necessarily dumping it all into stock market at once though. Your pay is lumpy so would be putting it in overtime like a set amount each month. 
 

ETA - also knowing your type of job (from your posts on this board) there are probably alternative investments you could access. 

Edited by Redwes25

Share this post


Link to post
Share on other sites
11 hours ago, ghostguy123 said:

In his position he doesnt need to try and make the "best" financial moves, but rather he should make sure he makes GOOD financial moves, or "not bad" financial moves.

Paying off your mortgage is a "not bad" financial move IMO, especially in his position.

This. One factor which may or may not apply to Otis is discipline to invest the money if he doesn’t pay the mortgage down. I was watching a big chunk of cash gathering little more than dust in a low interest checking account, so I chose to pay off my mortgage. While I could’ve earned a lot more with index funds, I wasn’t motivated to do so for many years. Paying off the mortgage definitely made me feel less tied down by my job, and provides peace of mind which is invaluable.

 

  • Like 2

Share this post


Link to post
Share on other sites
14 hours ago, culdeus said:

With my retirement accounts far ahead of schedule the thought has crossed my mind to just do the match and use the surplus to pay down the mort.  I'm actually shocked I don't see more people suggesting such a thing.  

It's not much different, in theory anyway, than buying bonds when equities are high, or rebalancing through contributions.

14 hours ago, ConstruxBoy said:

Well, a lot of people probably have really good rates on their mortgage and you can never get that compounding effect with retirement account back if you skip it now. 

Right.  Plus many won't remain in their current house. Thus paying off their current mortgage doesn't mean "never having another house payment", it's just hedging or going more conservative in their portfolio.

Share this post


Link to post
Share on other sites
30 minutes ago, -OZ- said:

It's not much different, in theory anyway, than buying bonds when equities are high, or rebalancing through contributions.

Right.  Plus many won't remain in their current house. Thus paying off their current mortgage doesn't mean "never having another house payment", it's just hedging or going more conservative in their portfolio.

We're never going to buy a bigger/more expensive house.  So if we pay the mortgage off, and if we ever move, when we sell our house we'd just buy the next house with cash.  The only way I'd have a mortgage after paying this one off is if we got a summer house, which isn't completely out of the question at some point.

 

Share this post


Link to post
Share on other sites

We paid off our mortgage last year.  Could've invested the money and watched it gain 15% last year.  Still dont feel like I made the "wrong" move though and very happy I did it.  The market could go up or down 20% this year and I really dont care either way.

  • Like 3

Share this post


Link to post
Share on other sites
2 hours ago, Otis said:

We're never going to buy a bigger/more expensive house.  So if we pay the mortgage off, and if we ever move, when we sell our house we'd just buy the next house with cash.  The only way I'd have a mortgage after paying this one off is if we got a summer house, which isn't completely out of the question at some point.

 

I'd still say if you're not planning to stay in the paid off house, you're simply hedging your bet in the market. Which isn't to say it's the wrong move. 

Sounds like you're not sure if you'll move, so all the more reason to pay it off. 

We're probably going to move, the house is just more than we need when the kids move out. We will go more expensive, lake or beach front, but smaller. 

  • Like 1

Share this post


Link to post
Share on other sites
On 1/3/2020 at 5:43 PM, Terminalxylem said:

Do you mind expounding on this?

For the record, the most important thing to determine is what one does or does not want done in the event of a cardiopulmonary arrest, ie. your heart and lungs stop functioning. There are three critical interventions, which usually occur simultaneously:

1. CPR - compressions on the chest

2. Defibrillation - shocking the heart in the event it is in a rhythm which doesn't circulate the blood

3. Intubation - placing a tube down the throat for a machine (ventilator) to breathe for you

DNR means do none of those three; let nature take its course. DNI means don't place on a breathing machine, which can be necessary independent of cardiac arrest.

 

I may be mis-remembering things, as it was with my father in law, not a direct blood relative - and I heard it through other family members (so possible game of telephone going on), but a DNR doesn't mean don't intubate.  That's a separate directive - discussed briefly here.  FIL had esophageal cancer, so a point was made about if he/family wanted him to be tubed or not due to location of cancer. 

Share this post


Link to post
Share on other sites
On 1/4/2020 at 9:45 AM, Tiger Fan said:

Take a look at this thread.  Not all LTC is the same, and some of it expires. Not trying to crap in your cheerios, but I thought i would definitely do this until I read through the thread.

 

http://www.early-retirement.org/forums/f28/long-term-care-insurance-101267.html?utm_source=newsletter&utm_medium=email

I've never sold or even quoted a plan that would expire.  Again, the premiums can increase in later years, so it may end up doing the same thing if you can't afford the new, higher premium, but by and large the plans do not expire.  You might exhaust the benefits of the plan, but that's different. 

Share this post


Link to post
Share on other sites
19 hours ago, culdeus said:

Yeah, but the pots of money are different.  I can't just stroke a check off the 401k for the balance.  Even if I just took the minimum and invested it given the RFROR% in paying down the mort that still is an option.  

At some point you look at the money you will have in 20 years and see that it is clearly fine, and wonder about the 20 years till then.

This thought process came when I was considering just doing Roth401k which is after tax money, then thought why the #### do I need to push this off.  I'm more than fine at this point.

I was running through this scenario with my wife this weekend as well.  We need to begin looking at increasing our available funds between now and the time we hit 59-1/2 (9 years for me).  I want to reduce the 401k contribution and invest in low risk products.

Even though she agrees with the math, she is leery about decreasing the 401k contribution and investing that money in other places since it goes against everything we have ever been taught.

Share this post


Link to post
Share on other sites
22 minutes ago, The Flying Turtle said:

I was running through this scenario with my wife this weekend as well.  We need to begin looking at increasing our available funds between now and the time we hit 59-1/2 (9 years for me).  I want to reduce the 401k contribution and invest in low risk products.

Even though she agrees with the math, she is leery about decreasing the 401k contribution and investing that money in other places since it goes against everything we have ever been taught.

I did some back of envelope calculation to see what I'd be "missing" just dropping back to the match instead max in terms of tax savings irrespective of how the investments would do.  

The results didn't really add up.  

https://www.vmf.com/home/monthly_extra_payment_to_principal

This is some online calculator with just me plowing in 800/month extra

If you add $800 to your monthly payment, you will pay off this debt in 185 payments instead of 379, and you will save $126,530.02 in interest charges.  This savings translates into a guaranteed, tax-free, average annual return of 5.55%.  And that's not even considering the emotional returns you'll get when you pay off this debt 194-months (16 years, 2 months) ahead of schedule!

Now with 2000/month extra (My wife's match criteria is lower)

If you add $2000 to your monthly payment, you will pay off this debt in 107 payments instead of 379, and you will save $171,918.75 in interest charges.  This savings translates into a guaranteed, tax-free, average annual return of 9.01%.  And that's not even considering the emotional returns you'll get when you pay off this debt 272-months (22 years, 8 months) ahead of schedule!

I don't really follow where they are coming up with these figures.  This is also not taking into account the number of payments I actually have left, either but I'm ok with that as I would consider refinancing to a lower rate anyways, which should make this worse.  

Share this post


Link to post
Share on other sites
30 minutes ago, The Flying Turtle said:

I was running through this scenario with my wife this weekend as well.  We need to begin looking at increasing our available funds between now and the time we hit 59-1/2 (9 years for me).  I want to reduce the 401k contribution and invest in low risk products.

Even though she agrees with the math, she is leery about decreasing the 401k contribution and investing that money in other places since it goes against everything we have ever been taught.

What low risk products are you talking about? Do you not have any of those options in your 401k?

You'd also need to take into account the before tax benefit in your net benefit.

Share this post


Link to post
Share on other sites
38 minutes ago, culdeus said:

I did some back of envelope calculation to see what I'd be "missing" just dropping back to the match instead max in terms of tax savings irrespective of how the investments would do.  

The results didn't really add up.  

https://www.vmf.com/home/monthly_extra_payment_to_principal

This is some online calculator with just me plowing in 800/month extra

If you add $800 to your monthly payment, you will pay off this debt in 185 payments instead of 379, and you will save $126,530.02 in interest charges.  This savings translates into a guaranteed, tax-free, average annual return of 5.55%.  And that's not even considering the emotional returns you'll get when you pay off this debt 194-months (16 years, 2 months) ahead of schedule!

Now with 2000/month extra (My wife's match criteria is lower)

If you add $2000 to your monthly payment, you will pay off this debt in 107 payments instead of 379, and you will save $171,918.75 in interest charges.  This savings translates into a guaranteed, tax-free, average annual return of 9.01%.  And that's not even considering the emotional returns you'll get when you pay off this debt 272-months (22 years, 8 months) ahead of schedule!

I don't really follow where they are coming up with these figures.  This is also not taking into account the number of payments I actually have left, either but I'm ok with that as I would consider refinancing to a lower rate anyways, which should make this worse.  

use this one instead

https://www.mortgagecalculators.info/calc-additionalpayment.php

 

  • Thanks 1

Share this post


Link to post
Share on other sites
5 hours ago, Random said:

We paid off our mortgage last year.  Could've invested the money and watched it gain 15% last year.  Still dont feel like I made the "wrong" move though and very happy I did it.  The market could go up or down 20% this year and I really dont care either way.

In same boat, paid of mortgage approximately 2 years ago.  I know there were probably better ways to invest the money but I'm conservative by nature and not good at sending a bunch of money at some investment product.  Anyhow it feels good to be totally debt free at 48 (46 when paid it off).

  • Like 2

Share this post


Link to post
Share on other sites
1 hour ago, KCitons said:

What low risk products are you talking about? Do you not have any of those options in your 401k?

You'd also need to take into account the before tax benefit in your net benefit.

I am not sure where I would invest. One option is to pay the mortgage early like others are considering.
 

I do have low risk options in 401k, but I am trying to bridge the gap between now and when I am 59-1/2. I want enough liquid cash so if we both stopped working today we could make it without too much pain. 

Share this post


Link to post
Share on other sites
1 minute ago, The Flying Turtle said:

I am not sure where I would invest. One option is to pay the mortgage early like others are considering.
 

I do have low risk options in 401k, but I am trying to bridge the gap between now and when I am 59-1/2. I want enough liquid cash so if we both stopped working today we could make it without too much pain. 

You probably know this but in case u dont, at 55 you can access the 401k of your last job penalty free.   

Share this post


Link to post
Share on other sites
5 minutes ago, NutterButter said:

You probably know this but in case u dont, at 55 you can access the 401k of your last job penalty free.   

If you were to do this and draw money at 55, then get another job, are you still able to draw penalty free while working at the new job?

Share this post


Link to post
Share on other sites
11 minutes ago, NutterButter said:

You probably know this but in case u dont, at 55 you can access the 401k of your last job penalty free.   

thanks, I did not know that. The major stipulation appears to be that you leave the job at 55 or older.  
 

You just have to hope your job isn’t eliminated when you are 54. 

Share this post


Link to post
Share on other sites
1 hour ago, yak651 said:

In same boat, paid of mortgage approximately 2 years ago.  I know there were probably better ways to invest the money but I'm conservative by nature and not good at sending a bunch of money at some investment product.  Anyhow it feels good to be totally debt free at 48 (46 when paid it off).

I always ask when people talk about how great it feels to be have their mortgage paid; would feel great about having investments worth more than your mortgage? 

The math can be tough, but it seems to me, knowing that I could pay off the mortgage with different accounts, feels every bit as good as not having the mortgage.

Maybe there's benefit to not "losing" thousands a day with the market. 

Share this post


Link to post
Share on other sites
8 minutes ago, The Flying Turtle said:

thanks, I did not know that. The major stipulation appears to be that you leave the job at 55 or older.  
 

You just have to hope your job isn’t eliminated when you are 54. 

True.  If you get a new job and your employers plan allows it u can rollover your old 401k to the new and quit at 55.  

Share this post


Link to post
Share on other sites
21 minutes ago, ghostguy123 said:

If you were to do this and draw money at 55, then get another job, are you still able to draw penalty free while working at the new job?

You definitely can get another job but not sure about whether you can contribute to their 401k and what happens if you do.  

Something to be aware of is to check with the 401k plan itself to see if they have any rules.  

Share this post


Link to post
Share on other sites

Would any of you even consider buying 1/13 of a house? 

https://www.trulia.com/p/sc/fripp-island/724-sea-dragon-ln-724-fripp-island-sc-29920--2430595042?rd=1

Nice place, but most timeshares are a bad idea. Obviously we'd need to understand how the maintenance, scheduling, etc go down. 

Share this post


Link to post
Share on other sites
49 minutes ago, The Flying Turtle said:

I am not sure where I would invest. One option is to pay the mortgage early like others are considering.
 

I do have low risk options in 401k, but I am trying to bridge the gap between now and when I am 59-1/2. I want enough liquid cash so if we both stopped working today we could make it without too much pain. 

I'm not sure I'm following. Paying off your mortgage, then quitting your job before what a bank considers retirement age, and then trying to get that cash back can be tricky. You don't have any income for the monthly payment.  I know, because I just went through it with Wells Fargo. They wouldn't approve a $150k home equity line on our $240k house. (they wanted to give us $85k). We went to my the credit union that my wife used when she was at the Post Office. They approved $175k without issue.  

If there was a way for you to fund a Roth with that money, that may be an option for other low risk investments and the ability to pull cash as needed. 

Share this post


Link to post
Share on other sites
7 minutes ago, -OZ- said:

Would any of you even consider buying 1/13 of a house? 

https://www.trulia.com/p/sc/fripp-island/724-sea-dragon-ln-724-fripp-island-sc-29920--2430595042?rd=1

Nice place, but most timeshares are a bad idea. Obviously we'd need to understand how the maintenance, scheduling, etc go down. 

The standard timeshares are run by a third party. Maintenance fees are used for upkeep etc. But their is also the upgrades to things like bedding, furniture, etc. With 13 owners I could see the maintenance fees being pretty high. 

Oh, and there's property tax / 13. 

  • Like 1

Share this post


Link to post
Share on other sites
41 minutes ago, -OZ- said:

I always ask when people talk about how great it feels to be have their mortgage paid; would feel great about having investments worth more than your mortgage? 

The math can be tough, but it seems to me, knowing that I could pay off the mortgage with different accounts, feels every bit as good as not having the mortgage.

Maybe there's benefit to not "losing" thousands a day with the market. 

Yep totally agree it doesn't make $$ sense and an investment account would most likely be an easier way to get the money out.  I didn't come from a family that invested, I came from one that saved, if that makes sense.  So the thought of paper loss from a crash like '08, even though it would most likely recover, makes me feel more secure with the home paid for.

  • Like 1

Share this post


Link to post
Share on other sites

I am currently sitting on a $175k line of credit at 6% interest. I am still waiting a few months to make a final decision, but the plan was to downsize and travel. That's probably going to be put off for at least a few years. 

With that in mind, I know many of you have expressed your opinions against paying off a mortgage. I know six percent is the stickler here. But, would you take the $175k and put it in a SP500 index fund for the short term?

Share this post


Link to post
Share on other sites
3 minutes ago, KCitons said:

I am currently sitting on a $175k line of credit at 6% interest. I am still waiting a few months to make a final decision, but the plan was to downsize and travel. That's probably going to be put off for at least a few years. 

With that in mind, I know many of you have expressed your opinions against paying off a mortgage. I know six percent is the stickler here. But, would you take the $175k and put it in a SP500 index fund for the short term?

Probably not a good idea to invest in equities with a short time horizon.  Unless you want to be a gambler, that is.

  • Like 1

Share this post


Link to post
Share on other sites
6 minutes ago, KCitons said:

I am currently sitting on a $175k line of credit at 6% interest. I am still waiting a few months to make a final decision, but the plan was to downsize and travel. That's probably going to be put off for at least a few years. 

With that in mind, I know many of you have expressed your opinions against paying off a mortgage. I know six percent is the stickler here. But, would you take the $175k and put it in a SP500 index fund for the short term?

That would scare me.

  • Thanks 1

Share this post


Link to post
Share on other sites
19 minutes ago, KCitons said:

I am currently sitting on a $175k line of credit at 6% interest. I am still waiting a few months to make a final decision, but the plan was to downsize and travel. That's probably going to be put off for at least a few years. 

With that in mind, I know many of you have expressed your opinions against paying off a mortgage. I know six percent is the stickler here. But, would you take the $175k and put it in a SP500 index fund for the short term?

Sounds like a very unnecessarily risky move with maybe some benefit but could easily be catasrophic.

Reward nowhere worth the risk.

Share this post


Link to post
Share on other sites

We have 3 no votes. Is it because of the 6% interest that needs to be overcome or the short term volatility we are seeing?

The reason I ask, when compared to Otis' situation, the short term volatility is there for him as well if he chooses to invest his bonus.

Share this post


Link to post
Share on other sites
3 minutes ago, KCitons said:

We have 3 no votes. Is it because of the 6% interest that needs to be overcome or the short term volatility we are seeing?

The reason I ask, when compared to Otis' situation, the short term volatility is there for him as well if he chooses to invest his bonus.

If I understand correctly, you might need the money in a few years?  If so, I wouldn't even do it at 0%.  Time horizon is too short.

 

 

 

Share this post


Link to post
Share on other sites
2 minutes ago, Juxtatarot said:

If I understand correctly, you might need the money in a few years?  If so, I wouldn't even do it at 0%.  Time horizon is too short.

 

 

 

Wish I knew. 

But, if I need the money, it would only be because I was either moving to a different house, or I bought an RV and was going to travel full time. With either, our current home would be sold and the line of credit would be paid off. Also the house appraised at $233k, the loan is $175k 

Share this post


Link to post
Share on other sites
1 hour ago, KCitons said:

I'm not sure I'm following. Paying off your mortgage, then quitting your job before what a bank considers retirement age, and then trying to get that cash back can be tricky. You don't have any income for the monthly payment.  I know, because I just went through it with Wells Fargo. They wouldn't approve a $150k home equity line on our $240k house. (they wanted to give us $85k). We went to my the credit union that my wife used when she was at the Post Office. They approved $175k without issue.  

If there was a way for you to fund a Roth with that money, that may be an option for other low risk investments and the ability to pull cash as needed. 

Hi KC,

I would not pay down the mortgage with the thought of getting the money back out.  My intent would solely be to reduce my monthly expenses.

For a very simplified example: Say I need $50k/year to live and in addition my mortgage is $20k/year and I want to retire at 55.  I can either save $70k*5 years = $350k or pay off my mortgage and only save $50k*5 years = $250k.

Share this post


Link to post
Share on other sites
2 minutes ago, The Flying Turtle said:

Hi KC,

I would not pay down the mortgage with the thought of getting the money back out.  My intent would solely be to reduce my monthly expenses.

For a very simplified example: Say I need $50k/year to live and in addition my mortgage is $20k/year and I want to retire at 55.  I can either save $70k*5 years = $350k or pay off my mortgage and only save $50k*5 years = $250k.

Got it. I agree with your thought process. Lowering monthly costs can allow you to achieve FI. But, as you pointed out, you're looking at reducing your 401k contributions. I don't think anyone here is going to think that's a good idea unless you have achieved your magic number already. 

  • Like 1

Share this post


Link to post
Share on other sites
34 minutes ago, KCitons said:

We have 3 no votes. Is it because of the 6% interest that needs to be overcome or the short term volatility we are seeing?

Both

  • Like 1

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Recently Browsing   0 members

    No registered users viewing this page.