As I announced recently, I’ve challenged myself to pay off my mortgage way sooner than the standard 30 years everyone seems to prescribe to. The more I think about it, though, the more I wonder if I am just being ridiculus. So I asked a fellow personal writer to come up with several reasons why someone might want to pay off their mortgage early.
Enter Jonny Pean. He tends to believe that debt of any kind is not good for your finances. He says you should shake off debt as fast as possible and live a comfortable, debt-free life. Below are his top five reasons for paying off your mortgage early.
Should You Pay Off Your Mortgage Early? Potential Reasons for Doing So
If you are having second thoughts about paying off your mortgage early, here are some reasons why you should do so:
1. Peace of mind: The best thing about paying off the mortgage on your house is that you can enjoy peace of mind. For many, a home is a prized possession, one they do not wish to part with just because they fall on hard times. If you should happen to not be able to make your payments down the road, you risk losing it. Therefore, having a house to live in comfortably will provide you the peace of mind.
2. Retirement benefits: After retirement you will not have a stable income to bank upon, and you may not be in a position to continue making mortgage payments at that time. If this would be the case for you, it might be a good idea to pay off your mortgage before retirement, when you can more easily afford it. If, after retiring, you feel that you cannot afford to maintain the home, you can sell it and can shift to a smaller property. Then you could use the extra money for other expenses.
3. Education plans for kids: If you pay off your mortgage early, the amount you pay toward your mortgage each month could be used for other expenses, like college educations for your children. Considering the cost of college, even a modest mortgage payment would not be enough to cover the entire annual tuition, but it would be a wonderful start.
4. Pursuing other dreams: If you pay off your mortgage loan completely, the amount you earn as monthly income later will be there for your expenditure. Without having to worry about your house, you will be able to save up for another large purchase, perhaps a vacation home?
5. Alternative investment options: When you have paid off your mortgage completely you can think of investing in other ways, like starting a new business or buying a property or other asset.
The Main Reason I Want to Pay Off My Mortgage
After reading Jonny’s top five reasons he would want to pay off his mortgage early, I find that I most agree with reason #1. However, I think the biggest draw for me would be the feeling of accomplishment. I feel like if I could do this, I could do anything, including fulfilling other dreams I have for our future.
How about you? If you want to pay off your mortgage sooner rather than later, what is your primary reason for wanting to do so?
Author bio: Jonny Pean is a financial consultant and writer for EasyFinance.com and FinanceWand.com. He helps people to tackle their financial problems related to loans, personal finance management and home equity issues.