Mortgage (debt) over Investing, Anyone else?

[ThePost]

I purchased a new townhouse approx. a year ago and since then I have been all about paying down my mortgage. (Even before then I had been saving up in order to pay 25% down).

Now I know the general rule is , pay down debt if you can't get as good of post tax return on your money. I think it's probable I could get a better return, but I just hate having debt and would much rather pay this mortgage off asap then take a risk for a slightly better ROI.

* I live in Canada so the mortgage interest isn't a tax write off

Any other debt haters out there, or is it all about the benjamins & ROI?

[maxtower]

There is a cost associated with peace of mind. Knowing that you will always have someplace to live might be worth more to you than others.

[RikaKazak]

[ QUOTE ]
There is a cost associated with peace of mind. Knowing that you will always have someplace to live might be worth more to you than others.

[/ QUOTE ]

I agree

I'm in a similiar situation OP....I have chosen to pay off my mortgage even though it's not the most "money +EV" but I think it's the most "relief/feeling/emotional state +EV" (if that makes sense)

[ekabe]

Look at your mortgage terms as well. Are you a fixed or floating rate? Im assuming because you put a 25% down payment you're not one of these crazy subprime borrowers and the times of cheap credit are going to dry up soon, so making the effort to pay off the mortgage will likely be worth it.

[gull]

If paying off debt makes you happy, then do it.
Happiness matters more than money.

[Nicholasp27]

isn't the point of obtaining more money to increase your happiness? so if paying down this mortgage brings u happiness, then that's better than the money anyway


in US, i'd generally advise to have a mortgage due to interest being tax deductible, but especially if not deductible, then no point in not paying it down

[ThePost]

Thanks for the feedback, Helps to reassure that I'm on the right path.

Also, I'm on a fixed 5 year term , 25 year amortization, although am hoping to have it paid off by the time it's up for renewal.

I'm in Alberta and the housing market boomed right after I purchased my home. (House has gone up ~80% in value since I bought it). So therefore I have the majority of my net worth invested into my home. I figure thats not balanced, but I'm going to owe this mortgage balance no matter what, so why not pay it off.

[RicoTubbs]

Remember that liquidity is important and, while you can subsequently take money out via a home equity loan, paying down a mortgage is putting money into something that's far less liquid than a savings account or the stock market (recognizing that you're getting a guaranteed return when you pay your mortgage off).

So just a reminder to not be too aggressive - you want to maintain a reasonable amount of liquidity.

[J.A.Sucker]

If you're a serious gambler, owning your house free and clear is HUGE. At least that's what Ray Zee always tells me, and he's probably right.

[emon87]

It's such a close call between the returns of investment vs the cost of a mortgage, particularly since you don't get the interest deducted, that you should do what makes you happy.

But make sure to retain 6 months living expenses in a liquid, safe product.