I would think that is where you want to be. My wife and I are about 80-85% mutual funds for our retirement. Our financial adviser thinks that is fantastic.
Mortgage/Retirement question
- Thread starter pfgemployee
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Inflation is currently higher than your mortgage rate. I'd keep investing in low cost index funds and make those cheap mortgage payments for the next decade and be debt free after that.
Also, The new tax law caps mortgage interest deductions on $750,000 I believe.
Also, The new tax law caps mortgage interest deductions on $750,000 I believe.
Run a quick amortization chart on your mortgage. On a 15 year note the portion of your payment allocated to interest at this point would be about 40% lesser than when it originated, or 50% less on a 30 year. As mentioned previously your effective rate at this point is actually less than 2.875, I'd stick with the 401k.
D
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Very nice rates. Still wouldn’t recommend having that money locked up like that.
Great minds think alike. I was going to call it free money in my reply but held off. I am a big fan of free money. Those opportunities don't come around that often.
Just to be clear, I was thinking about lowering the amount that I was putting in my 401k not my Roth 401k. My employer matches 6% on either as long as you do 6%.
2.8% money is really cheap money. If anything, just double your principal payment. Do the math on how much interest you'll be on the hook for - guessing it's a drop in the bucket when you look at your entire financial picture.
But hey - internet advice is worth exactly what you pay for it.
My mortgage starting out in this place was 9.5% in the 1980's and you had to shop hard or buy it down to get into single digits. 
Of course houses were way cheaper and accounts like saving and certificates still paid interested that didn't start at .1% or something. Still though, when I see mortgages at two-something it jolts me.
Of course houses were way cheaper and accounts like saving and certificates still paid interested that didn't start at .1% or something. Still though, when I see mortgages at two-something it jolts me.
If the market was lower I'd be more tempted to leave the mortgage as is and pump as much money as possible into the market. With the market where it is and the trade issues/uncertainty we see right now I would be tempted to put into retirement what you get the match on, then take the sure 2.875% return of paying off your mortgage.
My mortgage starting out in this place was 9.5% in the 1980's and you had to shop hard or buy it down to get into single digits.
Of course houses were way cheaper and accounts like saving and certificates still paid interested that didn't start at .1% or something. Still though, when I see mortgages at two-something it jolts me.
Crazy. Unfortunate you were buying at the peak.
That's what I was going to say - Interest payments on mortgages are extremely front loaded.
This is a pretty standard graph:
My brother has been a financial advisor for probably 30 years, now in his late 60's. I know he has always said "Never pay off your mortgage" because statistics prove your money over time will do better if it is invested.
Now, a lot of people are saying we are overdue for a market correction, but you still have 40 years or more of investing ahead of you so the market over that period, based on historical evidence, will rise. Plus this predicted correction is just a guess at this point and will depend quite a bit on the election results in November. So that is an important event to consider that is just over 3 months away. Anyway, there's another 2 cents worth.
Now, a lot of people are saying we are overdue for a market correction, but you still have 40 years or more of investing ahead of you so the market over that period, based on historical evidence, will rise. Plus this predicted correction is just a guess at this point and will depend quite a bit on the election results in November. So that is an important event to consider that is just over 3 months away. Anyway, there's another 2 cents worth.
Jacktronic
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It sounds like you're almost at the point where you need to think about whether you want to work until 59.5 or get out early. If you keep plowing into the 401k, you'll no doubt beat the returns of the house on a strictly net worth number. However, if you want to get out of the 9-5 earlier, having your house paid, non retirement investment accounts, or income producing real estate are absolute musts for you. It seems to me like you're crushing it on the 401k/Roth fronts, so you want to get more into your bridge accounts.
If it were me:
1. House paid off (I don't want to pay my mortgage anymore)
2. Max our all retirement accounts
3. Roll Pretax Retirements into Posttax Roth Accounts
4. Taxable Accounts/Real Estate/Annuities/Etc.
5. G-650
Just buy your coke in 1/4 ounce increments. Sell a ball in gram and 1/2 gram increments and keep the other ball for yourself. Free or d
Dude he works at pfg. Going to work there is better than being a retiree for 95% of retirees in this country.
