NEVER NEVER!  The American Dream of being Mortgage free, is such a mistake!   Most of us will have a mortgage to the day we die>  Why get rid of GOOD money paying off the mortgage when that money could be "working toward" something else.  Big Mistake, pay down a mortgage and use the rest of your money for a worthwhile investment.  Talk to you financial planner, make a plan, have a goal, but don't pay off your mortgage!!!   As my mother always said, "act in haste and repent at lesiure!"  "Debt free: Worry Fee??"  I think not............. my feelings are, "money in the bank is worry free!"  ................ another thing my mother always told me, "plan for those rainy days, you not know the time or the hour, that they will come!" 

This is just happensence but I think its the wave of the future.............

Thank you Ann, you should be a financial instructor/teacher - your "classroom" bedside manner, sets you out from the other loan officers!!   Keep the tidbits of information coming, I have started to print out your information and give it to my clients as house warming gifts..... KNOWLEDGE IS POWER................

Pay off your mortgage?  Not a chance.  Believe it or not, even if you have a $100,000 mortgage at 8% and $100K investment account earning 7%, you're better off after just a few years than the person who bought the $100K home outright.  Plus, your cash is liquid, whereas the equity in your home is not.  On top of all of that, the value of your home grows, regardless of whether there is a mortgage on it or not.  The equity, in and of itself, does nothing; the invested cash earns interest and compounds.

Well, I've been a advocate for both approaches, it really depends on your financial responcibility. The majority of our country has such a low financial IQ that they don't know what to do with the money unless they pay it towards their mortgage. It give most people a psychological wellbeing to have no mortgage. It is true that paying it off is technically not the most savvy choice but for most it might be the safest unless you can be disciplined and put together a prudent investment plan that you can stick to. 

I was a big fan of the option arm programs for a long time. I would take the client through a very intense questioning process to make sure that they would invest the savings instead of blowing it on bullshit. Even the people who were very sincere about being financially responsible wound up calling me 12 months later saying that they hadn't saved a penny. Basically taught me that because no one is taught finances in college/high school, how can we trust them to handle finances later in life? 

The 3rd thing that I have a pretty big problem with is that there are plenty of these "mortgage planners" that talk the talk about these strategies but if you looked at their financial portfolio it would show that they're renting an apartment driving a 50K BMW and have no liquidity at all. Quite funny actually.

Well I can speak for myself.  I paid my house off a few years ago.  Its really, really nice not to have to worry about having a mortgage especially with all the foreclosures going on.  If I am in a situation where I can't work, I don't have to worry about the biggest bill.  Gas, heat, electric are pretty minor.  I can always get a roommate to cover the items. 

I didn't want to be 75 years old before I paid off my mortgage, so I had it down to pay off years ago.  For me, it was 110% worth it. 

I'm on the financially savvy side.  If you can earn a double digit return then, borrow to the hilt.  If you don't understand what I mean, pay off your mortgage.  The conservative folks are going to pay it down and leave any surpluses in the bank earning 3%, and I have no problem with that, MOM. 

I think it all depends on the client. if they're not a risk-taker and want to play it safe, then pay off the mortgage. If a person is good with their money and can accumulate wealth while still carrying their mortgage, then this might be a good strategy. The fact of the matter is that most folk with any money at all owe nothing on their mortgage. Read the book "The Millionaire next door". Those are the people who are financially savvy. Take care.

Paul

I agree with the old adage "DEBT FREE, WORRY FREE" and I think this is the way for most conservative people as long as they are lucky enough to have the extra cash. Anyway, they can always apply for a HELOC which is Home Equity Line Of Credit and they can use this anytime they want...Great post.