Author Topic: Do you regret paying off your mortgage early?  (Read 98068 times)

dandarc

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Re: Do you regret paying off your mortgage early?
« Reply #550 on: December 04, 2017, 04:11:30 PM »
Keep saying it till its true slythr.

What you're doing wrong - you're going January of 2000 to January of 2008, for example, so a rolling 8 year period, not 7 as you've stated.  Then you're having the calculator adjust for inflation on investment returns, which is simply incorrect for this analysis.  And you're cherry picking to be sure to more or less maximally hit the worst market crash in 80 years. 

So, you're not convincing this particular guy who actually has paid off his mortgage and regrets it.

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Re: Do you regret paying off your mortgage early?
« Reply #551 on: December 04, 2017, 04:47:08 PM »
Quote
They still don't match yours exactly but the point is the same.
Slythr - Iím really trying to give you the benefit of the doubt here, but your numbers donít even come close to matching mine.  Consequentially, your analysis is off base.

And of course time frames matter. If someone says ďI want to know where to put $1,000 that IĒll need next springĒ the answer will be much different from if they wonít need that money until 2037.  To suggest 2 years or 50 years is the same is disingenuous.

Finally, youíve misunderstood the housing data. What matters isnít
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Scortius

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Re: Do you regret paying off your mortgage early?
« Reply #552 on: December 04, 2017, 04:48:23 PM »
Keep saying it till its true slythr.

What you're doing wrong - you're going January of 2000 to January of 2008, for example, so a rolling 8 year period, not 7 as you've stated.  Then you're having the calculator adjust for inflation on investment returns, which is simply incorrect for this analysis.  And you're cherry picking to be sure to more or less maximally hit the worst market crash in 80 years. 

So, you're not convincing this particular guy who actually has paid off his mortgage and regrets it.

Agreed, it's important to be fair in the mathematical analysis. Rates need to be unadjusted real returns and they need to factor in reinvested dividends. Each of those omissions alone will add an error factor of ~2.5%. Together their combined missing effect will be extremely significant.

dandarc

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Re: Do you regret paying off your mortgage early?
« Reply #553 on: December 04, 2017, 04:54:28 PM »
Keep saying it till its true slythr.

What you're doing wrong - you're going January of 2000 to January of 2008, for example, so a rolling 8 year period, not 7 as you've stated.  Then you're having the calculator adjust for inflation on investment returns, which is simply incorrect for this analysis.  And you're cherry picking to be sure to more or less maximally hit the worst market crash in 80 years. 

So, you're not convincing this particular guy who actually has paid off his mortgage and regrets it.

Agreed, it's important to be fair in the mathematical analysis. Rates need to be unadjusted real returns and they need to factor in reinvested dividends. Each of those omissions alone will add an error factor of ~2.5%. Together their combined missing effect will be extremely significant.
slythr was taking dividend reinvestment into account, but also adjusting for inflation.  At least I can exactly match the numbers in the stated calculator that way (except for -7.68% which should be -0.768%).  So slythr's giving invesment that ~2.5% penalty and just barely making the point, ignoring other flaws in the methods.  Which when the whole discussion is about breaking even at about 4% is a pretty big penalty.

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #554 on: December 04, 2017, 05:11:59 PM »
Keep saying it till its true slythr.

What you're doing wrong - you're going January of 2000 to January of 2008, for example, so a rolling 8 year period, not 7 as you've stated.  Then you're having the calculator adjust for inflation on investment returns, which is simply incorrect for this analysis.  And you're cherry picking to be sure to more or less maximally hit the worst market crash in 80 years. 

So, you're not convincing this particular guy who actually has paid off his mortgage and regrets it.

Agreed, it's important to be fair in the mathematical analysis. Rates need to be unadjusted real returns and they need to factor in reinvested dividends. Each of those omissions alone will add an error factor of ~2.5%. Together their combined missing effect will be extremely significant.
slythr was taking dividend reinvestment into account, but also adjusting for inflation.  At least I can exactly match the numbers in the stated calculator that way (except for -7.68% which should be -0.768%).  So slythr's giving invesment that ~2.5% penalty and just barely making the point, ignoring other flaws in the methods.  Which when the whole discussion is about breaking even at about 4% is a pretty big penalty.

My bad on the calculator  I was doing 6 things at once and kept the wrong input in the calc that added a year
Honest mistake.  It won't happen again  Promise.  Man I hope my entire argument isn't botched.

So taking Nero's numbers which I assume are correct....I get the exact same response I did earlier up in the post

"Over half of the timeframes the leverage strategy loses.
I explained why I started at 2000 in a prior post.  It is not cherry picked.  It is the beginning of when most on her started buying homes.  It is true that timeframe captures the 2007 and 2008 markets, but that is a reality that happens, and will happen again."

Yeah I am taking inflation into account.  But only for 7 years, so it's minimal
And it still fails half the time.

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Re: Do you regret paying off your mortgage early?
« Reply #555 on: December 04, 2017, 05:13:09 PM »
In response to the original question, I paid off my mortgage early and don't regret it. However, I didn't pay it off until my portfolio exceeded 25x expenses plus the mortgage amount, and I paid it off in a lump sum from selling bonds (so I moved to a higher stock allocation).

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Re: Do you regret paying off your mortgage early?
« Reply #556 on: December 04, 2017, 05:23:30 PM »
  And yes, you're looking at the difference over a 30 year period, even if the loan is paid off in 5 or 15 or however many years because the effects of the decision propagate well beyond the life of the loan itself, and it's important to look at the cumulative effect rather than the marginal difference to get an idea of the true trade-off. 

Interested in this quote
Where does the 30 year period come from?
Why does the difference have to be over 30 years?

Most home loans are 30 years.  So the comparison is paying off a 30-year mortgage, or not paying off a 30-year mortgage.   Saying otherwise is innumeracy. 


JLee

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Re: Do you regret paying off your mortgage early?
« Reply #557 on: December 04, 2017, 05:25:58 PM »
I have seen many of these threads.

Overall, my sense of the general situation is this:

1) Most people (Group A) who pay their mortgage off early don't regret it because they feel better having a paid-off house / no debt.

2) Most people (Group B) who invest instead of aggressively paying down their mortgage tend to make decisions based on math.

My unscientific speculative assessment is that Group A people are more likely to make emotional decisions and Group B people are more likely to make logical decisions.  In the event of a market crash, Group A people may be more likely to pull money from the market while Group B people may be more likely to stick to their investment plan and ride through a downturn. Conveniently, Group A won't have as much to lose by pulling out of the market because a significant portion of their net worth is in their home.  Group B will lose a lot more during a major crash, but will likely hold course and recover.

I could be entirely off base, but that is the general sense that I perceive.

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Re: Do you regret paying off your mortgage early?
« Reply #558 on: December 04, 2017, 05:32:08 PM »
Quote
So taking Nero's numbers which I assume are correct....I get the exact same response I did earlier up in the post

"Over half of the timeframes the leverage strategy loses.

Common man, you canít even spell my name right?  Are you trying to be annoying and disrespectful?

NO, over half of the timeframes do not lose. If you want to have a civil conversation you canít keep doing this.
...while youíre at it you probably should include this latest time frame - technically 6.92 years, but +13.05%. The most recent 6 year period is +14.79% btw...

...and no matter how many times you swear you arenít cherry picking data, you are still choosing 7 year periods and only looking at the most recent time period. Brooklynguy did a really nice post (and linking back to earlier discussion) on backtesting and why we donít just look at the most recent time period, regardless of when the most recent crop of mortgages were taken out.  S/he reminded me of something i had overlooked, and clarified the point nicely.
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boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #559 on: December 04, 2017, 05:41:54 PM »
The market never has to crash again slythr it could normalize by returning 5% including inflation for 2 years while earnings rise. Or it could continue at it's pace and earnings could rise faster than the current pace.  That's why you can't market time which is exactly what you're advocating. Regardless of if you want to call it that or not you're evaluating the market and suggesting that people do something based on it's current state. There is nothing else to fall that heaides market timing and the most intelligent investors of all time will tell you that's a poor man's game. Particularly for the normal diy investor.

That isn't to say I think either of those events are likely a correction based on history is more likely. But you're not presenting information correctly or in totality to come to the correct conclusion. Youre presenting information incorrectly with a bias towards your end goal.
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Telecaster

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Re: Do you regret paying off your mortgage early?
« Reply #560 on: December 04, 2017, 05:45:49 PM »
I have seen many of these threads.

Overall, my sense of the general situation is this:

1) Most people (Group A) who pay their mortgage off early don't regret it because they feel better having a paid-off house / no debt.

2) Most people (Group B) who invest instead of aggressively paying down their mortgage tend to make decisions based on math.

My unscientific speculative assessment is that Group A people are more likely to make emotional decisions and Group B people are more likely to make logical decisions.  In the event of a market crash, Group A people may be more likely to pull money from the market while Group B people may be more likely to stick to their investment plan and ride through a downturn. Conveniently, Group A won't have as much to lose by pulling out of the market because a significant portion of their net worth is in their home.  Group B will lose a lot more during a major crash, but will likely hold course and recover.

I could be entirely off base, but that is the general sense that I perceive.

You are correct.  There's nothing wrong with paying down a mortgage early.  But it clearly isn't optimal at today's rates.  Now, many give reasons for paying down the mortgage like peace of mind, don't want the hassle, etc. Those are all perfectly fine reasons, and you can't argue against them.  I can't place a price on your peace of mind.   If someone doesn't want the hassle, then they don't want the hassle.  No different really than the choice of vehicle.   

But mistakes like  ignoring the effects of inflation or comparing dissimilar time periods are dangerous.    Some people come to these threads to get an opinion about what to do.  Gross mistakes like the ones I mentioned can mislead people into making bad financial decisions.  It is important to make an informed decision, and the misinformation we are seeing in this thread is unhelpful in that regard.  If you really want an Escalade on credit then buy one, just don't kid yourself about the costs. 

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #561 on: December 04, 2017, 05:48:14 PM »
  And yes, you're looking at the difference over a 30 year period, even if the loan is paid off in 5 or 15 or however many years because the effects of the decision propagate well beyond the life of the loan itself, and it's important to look at the cumulative effect rather than the marginal difference to get an idea of the true trade-off. 

Interested in this quote
Where does the 30 year period come from?
Why does the difference have to be over 30 years?

Most home loans are 30 years.  So the comparison is paying off a 30-year mortgage, or not paying off a 30-year mortgage.   Saying otherwise is innumeracy.

So if there are only 25 years left on the mortgage does the above change.
Is that 30 years from 2017?
Is it then 29 years in 2018?
Or is it 30 years in perpetuity that resets every year?

Just trying to understand your rationale

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #562 on: December 04, 2017, 05:49:04 PM »
Scortius you really nailed it.  Your post was spot on.  And is why im relentless. It is not to attack those that paid it down except their math when it's incorrect. It must be corrected or others could read it and think it's correct outside of that. It's about making sure people understand what they are sacrificing for emotional reasons.
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boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #563 on: December 04, 2017, 05:54:54 PM »
  And yes, you're looking at the difference over a 30 year period, even if the loan is paid off in 5 or 15 or however many years because the effects of the decision propagate well beyond the life of the loan itself, and it's important to look at the cumulative effect rather than the marginal difference to get an idea of the true trade-off. 

Interested in this quote
Where does the 30 year period come from?
Why does the difference have to be over 30 years?

Most home loans are 30 years.  So the comparison is paying off a 30-year mortgage, or not paying off a 30-year mortgage.   Saying otherwise is innumeracy.

So if there are only 25 years left on the mortgage does the above change.
Is that 30 years from 2017?
Is it then 29 years in 2018?
Or is it 30 years in perpetuity that resets every year?

Just trying to understand your rationale

Nope it doesn't change annually. You make the decision and stick to it.  But if I had 25 years left on my mortgage today I'd refi because the rates are likely lower and I'd go to 30 years.
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Telecaster

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Re: Do you regret paying off your mortgage early?
« Reply #564 on: December 04, 2017, 05:56:45 PM »
  And yes, you're looking at the difference over a 30 year period, even if the loan is paid off in 5 or 15 or however many years because the effects of the decision propagate well beyond the life of the loan itself, and it's important to look at the cumulative effect rather than the marginal difference to get an idea of the true trade-off. 

Interested in this quote
Where does the 30 year period come from?
Why does the difference have to be over 30 years?

Most home loans are 30 years.  So the comparison is paying off a 30-year mortgage, or not paying off a 30-year mortgage.   Saying otherwise is innumeracy.

So if there are only 25 years left on the mortgage does the above change.
Is that 30 years from 2017?
Is it then 29 years in 2018?
Or is it 30 years in perpetuity that resets every year?

Just trying to understand your rationale

There are two outcomes.  You are trying to evaluate which outcome is better.   Because one of the options has a 30 year horizon, the only possible way to compare the two outcomes is use the same 30 year period. 

It is literally impossible to make a sensical comparison if don't use the same time periods. 


slythr

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Re: Do you regret paying off your mortgage early?
« Reply #565 on: December 04, 2017, 05:58:00 PM »
Quote
So taking Nero's numbers which I assume are correct....I get the exact same response I did earlier up in the post

"Over half of the timeframes the leverage strategy loses.

Common man, you canít even spell my name right?  Are you trying to be annoying and disrespectful?

NO, over half of the timeframes do not lose. If you want to have a civil conversation you canít keep doing this.
...while youíre at it you probably should include this latest time frame - technically 6.92 years, but +13.05%. The most recent 6 year period is +14.79% btw...

...and no matter how many times you swear you arenít cherry picking data, you are still choosing 7 year periods and only looking at the most recent time period. Brooklynguy did a really nice post (and linking back to earlier discussion) on backtesting and why we donít just look at the most recent time period, regardless of when the most recent crop of mortgages were taken out.  S/he reminded me of something i had overlooked, and clarified the point nicely.

Im doing this on my phone so hard to type and see with the response setup
Sorry about your name.  No disrespect. I really don't even pay attention to the names, moreso the arguments.
And I have been very civil.  You should see my uncivil side.  If I was trying to be annoying there would be no question.

I am looking directly at your numbers from your post.  Here they are:

1) 1.58%
2) 2.15%
3) (2.2%)
4) 5.4%
5) 3.7%
6) 3.5%
7) 4.3%
8) 5.8%
9) 8.0%
10) 14.4%

#'s 1,2,3,5 & 6 are all less than 4%, the current mortgage rate.  That's half?

We can debate 7 yrs vs 30 yrs and that is a debate we won't agree on and that is fine.
I like 7 years.  I can be convinced of 10.  I went back 50 years from 1966 to 2016 and still wan't convinced.

But this is just an aside.  Lots of reasons besides market performance to pay off so I try to not get too hung up on scenarios and what if's

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #566 on: December 04, 2017, 05:59:43 PM »
Slythr out of curiosity. If a person had room available in tax advantaged accounts would you recommend they pay down their mortgage or put the money into one of these accounts. 
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slythr

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Re: Do you regret paying off your mortgage early?
« Reply #567 on: December 04, 2017, 05:59:52 PM »
The market never has to crash again slythr it could normalize by returning 5% including inflation for 2 years while earnings rise. Or it could continue at it's pace and earnings could rise faster than the current pace.  That's why you can't market time which is exactly what you're advocating. Regardless of if you want to call it that or not you're evaluating the market and suggesting that people do something based on it's current state. There is nothing else to fall that heaides market timing and the most intelligent investors of all time will tell you that's a poor man's game. Particularly for the normal diy investor.

That isn't to say I think either of those events are likely a correction based on history is more likely. But you're not presenting information correctly or in totality to come to the correct conclusion. Youre presenting information incorrectly with a bias towards your end goal.

The good news is we will all find out one way or another.

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Re: Do you regret paying off your mortgage early?
« Reply #568 on: December 04, 2017, 06:01:01 PM »
You don't need to limit your analysis to the amount of time you'll own that particular house. Chances are once you sell that house you'll buy another. You'll have the opportunity to borrow money against that house just the same as against your current one.
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slythr

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Re: Do you regret paying off your mortgage early?
« Reply #569 on: December 04, 2017, 06:20:17 PM »
Slythr out of curiosity. If a person had room available in tax advantaged accounts would you recommend they pay down their mortgage or put the money into one of these accounts.

If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #570 on: December 04, 2017, 06:22:27 PM »
Slythr out of curiosity. If a person had room available in tax advantaged accounts would you recommend they pay down their mortgage or put the money into one of these accounts.

If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

I'll let the others here go ahead and feast on this.
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JLee

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Re: Do you regret paying off your mortgage early?
« Reply #571 on: December 04, 2017, 06:22:58 PM »
Slythr out of curiosity. If a person had room available in tax advantaged accounts would you recommend they pay down their mortgage or put the money into one of these accounts.

If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #572 on: December 04, 2017, 06:27:21 PM »
I thought that would solve this issue. We're clearly dealing with someone with a very large lack of understanding here.  Or a troll with a lot of time is the top also in?

If you're the former. You could stand to open your mind a lot.
« Last Edit: December 04, 2017, 06:29:09 PM by boarder42 »
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Re: Do you regret paying off your mortgage early?
« Reply #573 on: December 04, 2017, 06:33:00 PM »
I thought that would solve this issue. We're clearly dealing with someone with a very large lack of understanding here.  Or a troll with a lot of time is the top also in?

If you're the former. You could stand to open your mind a lot.

You thought wrong
My mind is very open, Hence my response

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Re: Do you regret paying off your mortgage early?
« Reply #574 on: December 04, 2017, 06:34:49 PM »
I'm glad there is was no disrespect intended.  Its sometimes hard to tell on a forum.  FWIW I do my best to write my posts to be respectful and informative.

The reason for my posting my numbers were to demonstrate how far your numbers were from the true value. Numbers are important.  So is terminology, which is why i got a bit touchy when 5/10 was referred to as "more than half".  If we're being objective we could say 2 were "about equal (within 1/4%), 5 were better and 3 were worse, though the better periods were much better than the subpar periods (mean 7.58% vs 0.51%, though including this latest period would bump it up 8.5%, or closer to the historical average which you've used udner the argument 'returning to the mean')

As for 'cherry-picking' the timeframe, I think you're still not understanding our points, and I urge you to go back and reread many of the posts here nad linked here, including Brooklynguy's recent one.  But consider this - had you chosen 1 yr periods it would be 11/18 (67%).  2 year periods = 13/17 (76%), 3 years = 10/16 (63%)...etc.  on the longer end if you expand the both the time period and go back til WWII so you can backtest, at 10 years = 87%, 13 year= 91% and 22-30 years = 100%.  (all data includes 2017, because there's just ~18 trading days left and we're +20.25%). In the longer time periods the few instances where the target was 'missed' it was on average <1%, whereas the periods with superior returns it was on average by >5%.

If you had gone back to 1995 or 1990 or 1980 the numbers are even better. 
Not only have you chosen to compare a 7yr time-horizon to a 30yr fixed mortage (incorrect for reasons stated by others) but intentionally or not you have literally chosen about the worst time frame possible for the given decade. Then to compound it, you've selected (again incorrectly) the calendar years most favorable to your argument. Ergo, calls of 'cherry-picking' data, even if it were unintentional. 

Even still, what your data has shown is that when its worse, it's barely worse, and when it's better it's substantially better.
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boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #575 on: December 04, 2017, 06:37:57 PM »
I thought that would solve this issue. We're clearly dealing with someone with a very large lack of understanding here.  Or a troll with a lot of time is the top also in?

If you're the former. You could stand to open your mind a lot.

You thought wrong
My mind is very open, Hence my response

It did solve this issue. That was what my statement meant. Sorry you misunderstood the meaning. The simple statement you made speaks volumes more than you currently realize.
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JLee

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Re: Do you regret paying off your mortgage early?
« Reply #576 on: December 04, 2017, 06:42:11 PM »
Slythr out of curiosity. If a person had room available in tax advantaged accounts would you recommend they pay down their mortgage or put the money into one of these accounts.

If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

I'll let the others here go ahead and feast on this.

I started at my current employer at the end of September 2 years ago. My 401k balance is currently $61,707.73.

If I went with the maximum employer match amount, 11% of my salary could have gone to the mortgage instead. After state and federal income tax, that is approximately $628/month.

My mortgage balance is $118,638.95.  Let's rewind 26 months of normal payments - I'd be at what, about $124,700, give or take.  The calculator I found can't do a 27 year mortgage, so I'll run this as a 30 year (adding a few years in favor of payoff, as a shorter term would have less interest overall).

A 30 year mortgage after 26 months of regular payments is on the left and a 30 year mortgage after 26 months of accelerated payments is on the right. Total interest paid is at the bottom on each side.  The mortgage balance under the accelerated payment schedule is $16,982.03 lower.

Code: [Select]
1 $577.51 $389.69 $124,512.18 $1,205.51 $389.69 $123,884.18 1 $577.51 $389.69 $124,512.18 $577.51 $389.69 $124,512.18
2 $577.51 $389.10 $124,323.77 $1,205.51 $387.14 $123,065.81 2 $577.51 $389.10 $124,323.77 $577.51 $389.10 $124,323.77
3 $577.51 $388.51 $124,134.77 $1,205.51 $384.58 $122,244.88 3 $577.51 $388.51 $124,134.77 $577.51 $388.51 $124,134.77
4 $577.51 $387.92 $123,945.18 $1,205.51 $382.02 $121,421.39 4 $577.51 $387.92 $123,945.18 $577.51 $387.92 $123,945.18
5 $577.51 $387.33 $123,755.00 $1,205.51 $379.44 $120,595.32 5 $577.51 $387.33 $123,755.00 $577.51 $387.33 $123,755.00
6 $577.51 $386.73 $123,564.22 $1,205.51 $376.86 $119,766.67 6 $577.51 $386.73 $123,564.22 $577.51 $386.73 $123,564.22
7 $577.51 $386.14 $123,372.85 $1,205.51 $374.27 $118,935.43 7 $577.51 $386.14 $123,372.85 $577.51 $386.14 $123,372.85
8 $577.51 $385.54 $123,180.88 $1,205.51 $371.67 $118,101.59 8 $577.51 $385.54 $123,180.88 $577.51 $385.54 $123,180.88
9 $577.51 $384.94 $122,988.31 $1,205.51 $369.07 $117,265.15 9 $577.51 $384.94 $122,988.31 $577.51 $384.94 $122,988.31
10 $577.51 $384.34 $122,795.14 $1,205.51 $366.45 $116,426.09 10 $577.51 $384.34 $122,795.14 $577.51 $384.34 $122,795.14
11 $577.51 $383.73 $122,601.36 $1,205.51 $363.83 $115,584.41 11 $577.51 $383.73 $122,601.36 $577.51 $383.73 $122,601.36
12 $577.51 $383.13 $122,406.98 $1,205.51 $361.20 $114,740.10 12 $577.51 $383.13 $122,406.98 $577.51 $383.13 $122,406.98
13 $577.51 $382.52 $122,211.99 $1,205.51 $358.56 $113,893.15 13 $577.51 $382.52 $122,211.99 $577.51 $382.52 $122,211.99
14 $577.51 $381.91 $122,016.39 $1,205.51 $355.92 $113,043.56 14 $577.51 $381.91 $122,016.39 $577.51 $381.91 $122,016.39
15 $577.51 $381.30 $121,820.18 $1,205.51 $353.26 $112,191.31 15 $577.51 $381.30 $121,820.18 $577.51 $381.30 $121,820.18
16 $577.51 $380.69 $121,623.36 $1,205.51 $350.60 $111,336.40 16 $577.51 $380.69 $121,623.36 $577.51 $380.69 $121,623.36
17 $577.51 $380.07 $121,425.92 $1,205.51 $347.93 $110,478.82 17 $577.51 $380.07 $121,425.92 $577.51 $380.07 $121,425.92
18 $577.51 $379.46 $121,227.87 $1,205.51 $345.25 $109,618.56 18 $577.51 $379.46 $121,227.87 $577.51 $379.46 $121,227.87
19 $577.51 $378.84 $121,029.20 $1,205.51 $342.56 $108,755.61 19 $577.51 $378.84 $121,029.20 $577.51 $378.84 $121,029.20
20 $577.51 $378.22 $120,829.91 $1,205.51 $339.86 $107,889.96 20 $577.51 $378.22 $120,829.91 $577.51 $378.22 $120,829.91
21 $577.51 $377.59 $120,629.99 $1,205.51 $337.16 $107,021.61 21 $577.51 $377.59 $120,629.99 $577.51 $377.59 $120,629.99
22 $577.51 $376.97 $120,429.45 $1,205.51 $334.44 $106,150.54 22 $577.51 $376.97 $120,429.45 $577.51 $376.97 $120,429.45
23 $577.51 $376.34 $120,228.28 $1,205.51 $331.72 $105,276.75 23 $577.51 $376.34 $120,228.28 $577.51 $376.34 $120,228.28
24 $577.51 $375.71 $120,026.48 $1,205.51 $328.99 $104,400.23 24 $577.51 $375.71 $120,026.48 $577.51 $375.71 $120,026.48
25 $577.51 $375.08 $119,824.05 $1,205.51 $326.25 $103,520.97 25 $577.51 $375.08 $119,824.05 $577.51 $375.08 $119,824.05
26 $577.51 $374.45 $119,620.99 $1,205.51 $323.50 $102,638.96 26 $577.51 $374.45 $119,620.99 $577.51 $374.45 $119,620.99

$9,282.22 $9,936.25

Yes, the time window is far too short to be of any real value and I am too lazy to project it out any farther than this, but by not paying ahead on my mortgage, I have $61k in my 401k. Cutting that by 61% (7% vs 18% contribution) would give me $23,790 -- a $37,240 loss in exchange for $654 in interest savings and an extra $16,982.03 in equity.

Granted this is all napkin math, but in 26 months I figure I'm ahead by approximately $19,600.  $16,660 in post-tax dollars, assuming retirement in the 15% bracket.

After 26 months. And I am rounding down.
« Last Edit: December 04, 2017, 06:45:57 PM by JLee »

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #577 on: December 04, 2017, 06:48:06 PM »
I'm glad there is was no disrespect intended.  Its sometimes hard to tell on a forum.  FWIW I do my best to write my posts to be respectful and informative.

The reason for my posting my numbers were to demonstrate how far your numbers were from the true value. Numbers are important.  So is terminology, which is why i got a bit touchy when 5/10 was referred to as "more than half".  If we're being objective we could say 2 were "about equal (within 1/4%), 5 were better and 3 were worse, though the better periods were much better than the subpar periods (mean 7.58% vs 0.51%, though including this latest period would bump it up 8.5%, or closer to the historical average which you've used udner the argument 'returning to the mean')

As for 'cherry-picking' the timeframe, I think you're still not understanding our points, and I urge you to go back and reread many of the posts here nad linked here, including Brooklynguy's recent one.  But consider this - had you chosen 1 yr periods it would be 11/18 (67%).  2 year periods = 13/17 (76%), 3 years = 10/16 (63%)...etc.  on the longer end if you expand the both the time period and go back til WWII so you can backtest, at 10 years = 87%, 13 year= 91% and 22-30 years = 100%.  (all data includes 2017, because there's just ~18 trading days left and we're +20.25%). In the longer time periods the few instances where the target was 'missed' it was on average <1%, whereas the periods with superior returns it was on average by >5%.

If you had gone back to 1995 or 1990 or 1980 the numbers are even better. 
Not only have you chosen to compare a 7yr time-horizon to a 30yr fixed mortage (incorrect for reasons stated by others) but intentionally or not you have literally chosen about the worst time frame possible for the given decade. Then to compound it, you've selected (again incorrectly) the calendar years most favorable to your argument. Ergo, calls of 'cherry-picking' data, even if it were unintentional. 

Even still, what your data has shown is that when its worse, it's barely worse, and when it's better it's substantially better.

I appreciate that
I chose the 7 year timeframe because that is how long the poster I was responding to owned his home.
And that is also the historical average for ownership. Somehow that response, to that guy about his 7 year ownership experience somehow turned into my defacto position on this issue, which isn't the case
It is what it is.
To be frank, I don't really give a **** about market performance either way.  Other points matter much more to me regarding the debate.
It's about 4th on the list of things that would be important- to me.
The return on equities pales in comparison to the return on my businesses, but I am a different breed and I don't dance to the same tune as many here
But I do appreciate you clarifying my mistake with the calculator.
Again, sorry about the name thing.

JLee

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Re: Do you regret paying off your mortgage early?
« Reply #578 on: December 04, 2017, 06:50:37 PM »
I'm glad there is was no disrespect intended.  Its sometimes hard to tell on a forum.  FWIW I do my best to write my posts to be respectful and informative.

The reason for my posting my numbers were to demonstrate how far your numbers were from the true value. Numbers are important.  So is terminology, which is why i got a bit touchy when 5/10 was referred to as "more than half".  If we're being objective we could say 2 were "about equal (within 1/4%), 5 were better and 3 were worse, though the better periods were much better than the subpar periods (mean 7.58% vs 0.51%, though including this latest period would bump it up 8.5%, or closer to the historical average which you've used udner the argument 'returning to the mean')

As for 'cherry-picking' the timeframe, I think you're still not understanding our points, and I urge you to go back and reread many of the posts here nad linked here, including Brooklynguy's recent one.  But consider this - had you chosen 1 yr periods it would be 11/18 (67%).  2 year periods = 13/17 (76%), 3 years = 10/16 (63%)...etc.  on the longer end if you expand the both the time period and go back til WWII so you can backtest, at 10 years = 87%, 13 year= 91% and 22-30 years = 100%.  (all data includes 2017, because there's just ~18 trading days left and we're +20.25%). In the longer time periods the few instances where the target was 'missed' it was on average <1%, whereas the periods with superior returns it was on average by >5%.

If you had gone back to 1995 or 1990 or 1980 the numbers are even better. 
Not only have you chosen to compare a 7yr time-horizon to a 30yr fixed mortage (incorrect for reasons stated by others) but intentionally or not you have literally chosen about the worst time frame possible for the given decade. Then to compound it, you've selected (again incorrectly) the calendar years most favorable to your argument. Ergo, calls of 'cherry-picking' data, even if it were unintentional. 

Even still, what your data has shown is that when its worse, it's barely worse, and when it's better it's substantially better.

I appreciate that
I chose the 7 year timeframe because that is how long the poster I was responding to owned his home.
And that is also the historical average for ownership. Somehow that response, to that guy about his 7 year ownership experience somehow turned into my defacto position on this issue, which isn't the case
It is what it is.
To be frank, I don't really give a **** about market performance either way.  Other points matter much more to me regarding the debate.
It's about 4th on the list of things that would be important- to me.
The return on equities pales in comparison to the return on my businesses, but I am a different breed and I don't dance to the same tune as many here
But I do appreciate you clarifying my mistake with the calculator.
Again, sorry about the name thing.

There it is! 

For the 90%+ on this forum who plan on retiring early, returns matter.

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #579 on: December 04, 2017, 06:55:07 PM »
Slythr out of curiosity. If a person had room available in tax advantaged accounts would you recommend they pay down their mortgage or put the money into one of these accounts.

If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage



I'll let the others here go ahead and feast on this.

I started at my current employer at the end of September 2 years ago. My 401k balance is currently $61,707.73.

If I went with the maximum employer match amount, 11% of my salary could have gone to the mortgage instead. After state and federal income tax, that is approximately $628/month.

My mortgage balance is $118,638.95.  Let's rewind 26 months of normal payments - I'd be at what, about $124,700, give or take.  The calculator I found can't do a 27 year mortgage, so I'll run this as a 30 year (adding a few years in favor of payoff, as a shorter term would have less interest overall).

A 30 year mortgage after 26 months of regular payments is on the left and a 30 year mortgage after 26 months of accelerated payments is on the right. Total interest paid is at the bottom on each side.  The mortgage balance under the accelerated payment schedule is $16,982.03 lower.

Code: [Select]
1 $577.51 $389.69 $124,512.18 $1,205.51 $389.69 $123,884.18 1 $577.51 $389.69 $124,512.18 $577.51 $389.69 $124,512.18
2 $577.51 $389.10 $124,323.77 $1,205.51 $387.14 $123,065.81 2 $577.51 $389.10 $124,323.77 $577.51 $389.10 $124,323.77
3 $577.51 $388.51 $124,134.77 $1,205.51 $384.58 $122,244.88 3 $577.51 $388.51 $124,134.77 $577.51 $388.51 $124,134.77
4 $577.51 $387.92 $123,945.18 $1,205.51 $382.02 $121,421.39 4 $577.51 $387.92 $123,945.18 $577.51 $387.92 $123,945.18
5 $577.51 $387.33 $123,755.00 $1,205.51 $379.44 $120,595.32 5 $577.51 $387.33 $123,755.00 $577.51 $387.33 $123,755.00
6 $577.51 $386.73 $123,564.22 $1,205.51 $376.86 $119,766.67 6 $577.51 $386.73 $123,564.22 $577.51 $386.73 $123,564.22
7 $577.51 $386.14 $123,372.85 $1,205.51 $374.27 $118,935.43 7 $577.51 $386.14 $123,372.85 $577.51 $386.14 $123,372.85
8 $577.51 $385.54 $123,180.88 $1,205.51 $371.67 $118,101.59 8 $577.51 $385.54 $123,180.88 $577.51 $385.54 $123,180.88
9 $577.51 $384.94 $122,988.31 $1,205.51 $369.07 $117,265.15 9 $577.51 $384.94 $122,988.31 $577.51 $384.94 $122,988.31
10 $577.51 $384.34 $122,795.14 $1,205.51 $366.45 $116,426.09 10 $577.51 $384.34 $122,795.14 $577.51 $384.34 $122,795.14
11 $577.51 $383.73 $122,601.36 $1,205.51 $363.83 $115,584.41 11 $577.51 $383.73 $122,601.36 $577.51 $383.73 $122,601.36
12 $577.51 $383.13 $122,406.98 $1,205.51 $361.20 $114,740.10 12 $577.51 $383.13 $122,406.98 $577.51 $383.13 $122,406.98
13 $577.51 $382.52 $122,211.99 $1,205.51 $358.56 $113,893.15 13 $577.51 $382.52 $122,211.99 $577.51 $382.52 $122,211.99
14 $577.51 $381.91 $122,016.39 $1,205.51 $355.92 $113,043.56 14 $577.51 $381.91 $122,016.39 $577.51 $381.91 $122,016.39
15 $577.51 $381.30 $121,820.18 $1,205.51 $353.26 $112,191.31 15 $577.51 $381.30 $121,820.18 $577.51 $381.30 $121,820.18
16 $577.51 $380.69 $121,623.36 $1,205.51 $350.60 $111,336.40 16 $577.51 $380.69 $121,623.36 $577.51 $380.69 $121,623.36
17 $577.51 $380.07 $121,425.92 $1,205.51 $347.93 $110,478.82 17 $577.51 $380.07 $121,425.92 $577.51 $380.07 $121,425.92
18 $577.51 $379.46 $121,227.87 $1,205.51 $345.25 $109,618.56 18 $577.51 $379.46 $121,227.87 $577.51 $379.46 $121,227.87
19 $577.51 $378.84 $121,029.20 $1,205.51 $342.56 $108,755.61 19 $577.51 $378.84 $121,029.20 $577.51 $378.84 $121,029.20
20 $577.51 $378.22 $120,829.91 $1,205.51 $339.86 $107,889.96 20 $577.51 $378.22 $120,829.91 $577.51 $378.22 $120,829.91
21 $577.51 $377.59 $120,629.99 $1,205.51 $337.16 $107,021.61 21 $577.51 $377.59 $120,629.99 $577.51 $377.59 $120,629.99
22 $577.51 $376.97 $120,429.45 $1,205.51 $334.44 $106,150.54 22 $577.51 $376.97 $120,429.45 $577.51 $376.97 $120,429.45
23 $577.51 $376.34 $120,228.28 $1,205.51 $331.72 $105,276.75 23 $577.51 $376.34 $120,228.28 $577.51 $376.34 $120,228.28
24 $577.51 $375.71 $120,026.48 $1,205.51 $328.99 $104,400.23 24 $577.51 $375.71 $120,026.48 $577.51 $375.71 $120,026.48
25 $577.51 $375.08 $119,824.05 $1,205.51 $326.25 $103,520.97 25 $577.51 $375.08 $119,824.05 $577.51 $375.08 $119,824.05
26 $577.51 $374.45 $119,620.99 $1,205.51 $323.50 $102,638.96 26 $577.51 $374.45 $119,620.99 $577.51 $374.45 $119,620.99

$9,282.22 $9,936.25

Yes, the time window is far too short to be of any real value and I am too lazy to project it out any farther than this, but by not paying ahead on my mortgage, I have $61k in my 401k. Cutting that by 61% (7% vs 18% contribution) would give me $23,790 -- a $37,240 loss in exchange for $654 in interest savings and an extra $16,982.03 in equity.

Granted this is all napkin math, but in 26 months I figure I'm ahead by approximately $19,600.  $16,660 in post-tax dollars, assuming retirement in the 15% bracket.

After 26 months. And I am rounding down.

Congratulations.  Really.  That is great for you
You are comparing a past 2 year equity performance of over 16% annually to a home loan
Of course the 401K is going to win.

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #580 on: December 04, 2017, 06:57:09 PM »
For carrying so much about those other points you never responded to my counter to the other points which left you with a single point emotion. Which the math team must forfeit to since everyone who has chosen due to a feeling puts infinity value on.
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slythr

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Re: Do you regret paying off your mortgage early?
« Reply #581 on: December 04, 2017, 06:58:36 PM »
I'm glad there is was no disrespect intended.  Its sometimes hard to tell on a forum.  FWIW I do my best to write my posts to be respectful and informative.

The reason for my posting my numbers were to demonstrate how far your numbers were from the true value. Numbers are important.  So is terminology, which is why i got a bit touchy when 5/10 was referred to as "more than half".  If we're being objective we could say 2 were "about equal (within 1/4%), 5 were better and 3 were worse, though the better periods were much better than the subpar periods (mean 7.58% vs 0.51%, though including this latest period would bump it up 8.5%, or closer to the historical average which you've used udner the argument 'returning to the mean')

As for 'cherry-picking' the timeframe, I think you're still not understanding our points, and I urge you to go back and reread many of the posts here nad linked here, including Brooklynguy's recent one.  But consider this - had you chosen 1 yr periods it would be 11/18 (67%).  2 year periods = 13/17 (76%), 3 years = 10/16 (63%)...etc.  on the longer end if you expand the both the time period and go back til WWII so you can backtest, at 10 years = 87%, 13 year= 91% and 22-30 years = 100%.  (all data includes 2017, because there's just ~18 trading days left and we're +20.25%). In the longer time periods the few instances where the target was 'missed' it was on average <1%, whereas the periods with superior returns it was on average by >5%.

If you had gone back to 1995 or 1990 or 1980 the numbers are even better. 
Not only have you chosen to compare a 7yr time-horizon to a 30yr fixed mortage (incorrect for reasons stated by others) but intentionally or not you have literally chosen about the worst time frame possible for the given decade. Then to compound it, you've selected (again incorrectly) the calendar years most favorable to your argument. Ergo, calls of 'cherry-picking' data, even if it were unintentional. 

Even still, what your data has shown is that when its worse, it's barely worse, and when it's better it's substantially better.

I appreciate that
I chose the 7 year timeframe because that is how long the poster I was responding to owned his home.
And that is also the historical average for ownership. Somehow that response, to that guy about his 7 year ownership experience somehow turned into my defacto position on this issue, which isn't the case
It is what it is.
To be frank, I don't really give a **** about market performance either way.  Other points matter much more to me regarding the debate.
It's about 4th on the list of things that would be important- to me.
The return on equities pales in comparison to the return on my businesses, but I am a different breed and I don't dance to the same tune as many here
But I do appreciate you clarifying my mistake with the calculator.
Again, sorry about the name thing.

There it is! 

For the 90%+ on this forum who plan on retiring early, returns matter.

Hey JLee
Welcome to 2 pages ago on the thread where I already clearly explained to Boarder that I am not part of the 90% who need a 4% SWR.

But my quote above was about market performance regarding leverage, not retirement.

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #582 on: December 04, 2017, 07:01:15 PM »
For carrying so much about those other points you never responded to my counter to the other points which left you with a single point emotion. Which the math team must forfeit to since everyone who has chosen due to a feeling puts infinity value on.


I didn't respond because your argument on the other points made no sense.
It wasn't a counter, it was a dismissal.
I don't mind debating, but there were no points to debate.
And they are points many other people made, not just me.

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #583 on: December 04, 2017, 07:03:47 PM »
But really this is all null bc you chose paying down a mortgage over maxing tax advantaged accounts which even those in favor of paying down mortgages would not do in the forum. It's so mathematically bad it really doesn't matter if we do happen to be in the worst 7 10 15 year window in history the practice of paying down a mortgage over maxing these accounts loses hand over fist.
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boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #584 on: December 04, 2017, 07:06:17 PM »
For carrying so much about those other points you never responded to my counter to the other points which left you with a single point emotion. Which the math team must forfeit to since everyone who has chosen due to a feeling puts infinity value on.


I didn't respond because your argument on the other points made no sense.
It wasn't a counter, it was a dismissal.
I don't mind debating, but there were no points to debate.
And they are points many other people made, not just me.

I asked you to show math for the advantages of the presumably better ones. You didn't bc you can't and Brooklynguy already linked to this debate where those were overstated.

I asked you to give examples of this control one needs that paying down a mortgage gets you. You gave no example of when this would be advantageous or what percentage of people this would actually effect.
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JLee

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Re: Do you regret paying off your mortgage early?
« Reply #585 on: December 04, 2017, 07:07:15 PM »
Congratulations.  Really.  That is great for you
You are comparing a past 2 year equity performance of over 16% annually to a home loan
Of course the 401K is going to win.

Yep. And from what I can gather, others want to compare the worst time period in recent history.

If you're going to one extreme with speculation, I might as well go to the other with what actually happened to me.

I do care about market returns, though - and since you don't, I'm not sure what else we have to discuss.

jleo

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Re: Do you regret paying off your mortgage early?
« Reply #586 on: December 04, 2017, 07:12:55 PM »
Quote
One thing I never hear is isn't one disadvantage of paying off a mortgage loan early an increase in risk of a lawsuit as a paid off home anyone can basically look that up and see you have a large asset paid off and make you a target?

It's an issue. Much depends on your state's homestead exemption. It's good to have an umbrella policy just in case.

Certainly it's easy to find out in public records that that large, paid-off asset is sitting there for the taking. An investment account shouldn't be "visible" in that way.

I do have an umbrella but seems to only cover you in certain cases and not all cases.

If you paid off your house and then took out a HELOC would it appear as you possibly just refi the house to the public records and not paid it off as I believe there would be another lien added?

Curious as I like the idea of having the spending power with the line of credit incase of an opportunity you can quickly act on.

channtheman

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Re: Do you regret paying off your mortgage early?
« Reply #587 on: December 04, 2017, 07:23:27 PM »
That's a very unscientific analysis.

LOL "scientific analysis." It's a freakin poll about how people FEEL. But flog away at that grease spot.

I thought your post was helpful.  All you did was compile the results of this thread as if it were a poll.  Relevant to the original post.

Telecaster

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Re: Do you regret paying off your mortgage early?
« Reply #588 on: December 04, 2017, 07:35:27 PM »
If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

My risk tolerance is nearly infinitely lower.   Maxing out tax advantaged accounts is a bird in hand.  You get the advantage today, and it is roughly equal to your top marginal bracket (quibbles wit that characterization noted, and accepted into evidence).  Paying off the mortgage is roughly equal to your mortgage rate minus the rate of inflation, which might very well be add up to zero. 

Giving up a bird in the hand for very possibly zero reward sounds literally insane to me.  That is crazy, crazy, crazy, risk taking.  I am far too risk adverse to do something like that. 

JLee

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Re: Do you regret paying off your mortgage early?
« Reply #589 on: December 04, 2017, 07:56:08 PM »
If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

My risk tolerance is nearly infinitely lower.   Maxing out tax advantaged accounts is a bird in hand.  You get the advantage today, and it is roughly equal to your top marginal bracket (quibbles wit that characterization noted, and accepted into evidence).  Paying off the mortgage is roughly equal to your mortgage rate minus the rate of inflation, which might very well be add up to zero. 

Giving up a bird in the hand for very possibly zero reward sounds literally insane to me.  That is crazy, crazy, crazy, risk taking.  I am far too risk adverse to do something like that.

Hadn't looked at it that way, but yeah..

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #590 on: December 04, 2017, 07:57:23 PM »
If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

My risk tolerance is nearly infinitely lower.   Maxing out tax advantaged accounts is a bird in hand.  You get the advantage today, and it is roughly equal to your top marginal bracket (quibbles wit that characterization noted, and accepted into evidence).  Paying off the mortgage is roughly equal to your mortgage rate minus the rate of inflation, which might very well be add up to zero. 

Giving up a bird in the hand for very possibly zero reward sounds literally insane to me.  That is crazy, crazy, crazy, risk taking.  I am far too risk adverse to do something like that.

Boarder asked me if I would rather max out a tax advantaged account (equities) or apply to the mortgage
Those were the only two options I was given.  I could have clarified, but that would be boring
I would take free money from the match.
After that I wouldn't invest in the equity market right now.  I said that to him 2 pages ago.
I have said that 15 times on this thread
I invest in what I understand and control.
I would invest in fixed income, or in other things, but not equities.
Especially now at record all time highs.
I would invest in real estate, collector automobiles, my businesses, or a myriad of other things.

My risk tolerance is low.  I wouldn't touch this market with any money of value.
You guys hold up the equity market like it is some king. Not really.
There are many other investments that offer far more return, much less risk, and are enjoyable.
I have investments that return double, triple or more of the equity market.
Equities don't appeal to me.  They have little involvement in my opinion.  I like involvement

I see the wow comments?, and the I need to open my mind comments. I smile!
My mind is the one here wide open.  It's not just the equity market or nothing for me. It is actually just about every other market except that.  Investment you can live in, drive, hold, look at or work on.
The equity market will never be a bird in the hand, because you have no control over it.  I have investments that are a bird in the hand.  I know exactly what they will pay me months or years from now.  THAT is a bird in the hand.

My investments are my employees.  Real employees.  Buildings, Businesses, Brands. and lots of other things.
Some of you criticizing me and others work for someone else all day, sometimes in a job you hate, making them rich, then go home to your mortgaged home with little net worth, hop on the net, and then call people like me crazy.

Now that is good.
« Last Edit: December 04, 2017, 08:00:44 PM by slythr »

JLee

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Re: Do you regret paying off your mortgage early?
« Reply #591 on: December 04, 2017, 07:59:25 PM »
If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

My risk tolerance is nearly infinitely lower.   Maxing out tax advantaged accounts is a bird in hand.  You get the advantage today, and it is roughly equal to your top marginal bracket (quibbles wit that characterization noted, and accepted into evidence).  Paying off the mortgage is roughly equal to your mortgage rate minus the rate of inflation, which might very well be add up to zero. 

Giving up a bird in the hand for very possibly zero reward sounds literally insane to me.  That is crazy, crazy, crazy, risk taking.  I am far too risk adverse to do something like that.

Boarder asked me if I would rather max out a tax advantaged account (equities) or apply to the mortgage
Those were the only two options I was given.  I could have clarified, but that would be boring
I would take free money from the match.
After that I wouldn't invest in the equity market right now.  I said that to him 2 pages ago.
I have said that 15 times on this thread
I invest in what I understand and control.
I would invest in fixed income, or in other things, but not equities.
Especially now at record all time highs.
I would invest in real estate, collector automobiles, my other businesses, or a myriad of other things.

My risk tolerance is low.  I wouldn't touch this market with any money of value.
You guys hold up the equity market like it is some king. Not really.
There are many other investments that offer far more return, much less risk, and are enjoyable.
I have investments that return double, triple or more of the equity market.
Equities don't appeal to me.  They have little involvement in my opinion.  I like involvement

I see the wow comments?, and the I need to open my mind comments. I smile!
My mind is the one here wide open.  It's not just the equity market or nothing for me. It is actually just about every other market except that.  Investment you can live in, drive, hold, look at or work on.
The equity market will never be a bird in the hand, because you have no control over it.  I have investments that are a bird in the hand.  I know exactly what they will pay me months or years from now.  THAT is a bird in the hand.

My investments are my employees.  Real employees.  Buildings, Businesses, Brands. and lots of other things.
Some of you criticizing me and others work for someone else all day, sometimes in a job you hate, making them rich, then go home to your mortgaged home with little net worth, hop on the net, and then call people like me crazy.

That to me is silly.

That statement amuses me.

If the market wasn't routinely at all time highs, what exactly would be the point of investing?

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #592 on: December 04, 2017, 08:09:07 PM »
If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

My risk tolerance is nearly infinitely lower.   Maxing out tax advantaged accounts is a bird in hand.  You get the advantage today, and it is roughly equal to your top marginal bracket (quibbles wit that characterization noted, and accepted into evidence).  Paying off the mortgage is roughly equal to your mortgage rate minus the rate of inflation, which might very well be add up to zero. 

Giving up a bird in the hand for very possibly zero reward sounds literally insane to me.  That is crazy, crazy, crazy, risk taking.  I am far too risk adverse to do something like that.

Boarder asked me if I would rather max out a tax advantaged account (equities) or apply to the mortgage
Those were the only two options I was given.  I could have clarified, but that would be boring
I would take free money from the match.
After that I wouldn't invest in the equity market right now.  I said that to him 2 pages ago.
I have said that 15 times on this thread
I invest in what I understand and control.
I would invest in fixed income, or in other things, but not equities.
Especially now at record all time highs.
I would invest in real estate, collector automobiles, my other businesses, or a myriad of other things.

My risk tolerance is low.  I wouldn't touch this market with any money of value.
You guys hold up the equity market like it is some king. Not really.
There are many other investments that offer far more return, much less risk, and are enjoyable.
I have investments that return double, triple or more of the equity market.
Equities don't appeal to me.  They have little involvement in my opinion.  I like involvement

I see the wow comments?, and the I need to open my mind comments. I smile!
My mind is the one here wide open.  It's not just the equity market or nothing for me. It is actually just about every other market except that.  Investment you can live in, drive, hold, look at or work on.
The equity market will never be a bird in the hand, because you have no control over it.  I have investments that are a bird in the hand.  I know exactly what they will pay me months or years from now.  THAT is a bird in the hand.

My investments are my employees.  Real employees.  Buildings, Businesses, Brands. and lots of other things.
Some of you criticizing me and others work for someone else all day, sometimes in a job you hate, making them rich, then go home to your mortgaged home with little net worth, hop on the net, and then call people like me crazy.

That to me is silly.

That statement amuses me.

If the market wasn't routinely at all time highs, what exactly would be the point of investing?

The next few years will really amuse you
So you are not a buy low sell high person?. 

Wait...I thought the goal was to buy low when everything is on sale, right?
« Last Edit: December 04, 2017, 08:12:01 PM by slythr »

boarder42

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Re: Do you regret paying off your mortgage early?
« Reply #593 on: December 04, 2017, 08:17:15 PM »
Market timing.

You buy constantly regardless of the market valuation

This just gets better and better
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JLee

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Re: Do you regret paying off your mortgage early?
« Reply #594 on: December 04, 2017, 08:18:11 PM »
If there is any match, the qualified account up to the max match limit
Once any match is maxed, mortgage

Wow.

My risk tolerance is nearly infinitely higher than yours, then.

My risk tolerance is nearly infinitely lower.   Maxing out tax advantaged accounts is a bird in hand.  You get the advantage today, and it is roughly equal to your top marginal bracket (quibbles wit that characterization noted, and accepted into evidence).  Paying off the mortgage is roughly equal to your mortgage rate minus the rate of inflation, which might very well be add up to zero. 

Giving up a bird in the hand for very possibly zero reward sounds literally insane to me.  That is crazy, crazy, crazy, risk taking.  I am far too risk adverse to do something like that.

Boarder asked me if I would rather max out a tax advantaged account (equities) or apply to the mortgage
Those were the only two options I was given.  I could have clarified, but that would be boring
I would take free money from the match.
After that I wouldn't invest in the equity market right now.  I said that to him 2 pages ago.
I have said that 15 times on this thread
I invest in what I understand and control.
I would invest in fixed income, or in other things, but not equities.
Especially now at record all time highs.
I would invest in real estate, collector automobiles, my other businesses, or a myriad of other things.

My risk tolerance is low.  I wouldn't touch this market with any money of value.
You guys hold up the equity market like it is some king. Not really.
There are many other investments that offer far more return, much less risk, and are enjoyable.
I have investments that return double, triple or more of the equity market.
Equities don't appeal to me.  They have little involvement in my opinion.  I like involvement

I see the wow comments?, and the I need to open my mind comments. I smile!
My mind is the one here wide open.  It's not just the equity market or nothing for me. It is actually just about every other market except that.  Investment you can live in, drive, hold, look at or work on.
The equity market will never be a bird in the hand, because you have no control over it.  I have investments that are a bird in the hand.  I know exactly what they will pay me months or years from now.  THAT is a bird in the hand.

My investments are my employees.  Real employees.  Buildings, Businesses, Brands. and lots of other things.
Some of you criticizing me and others work for someone else all day, sometimes in a job you hate, making them rich, then go home to your mortgaged home with little net worth, hop on the net, and then call people like me crazy.

That to me is silly.

That statement amuses me.

If the market wasn't routinely at all time highs, what exactly would be the point of investing?

The next few years will really amuse you
So you are not a buy low sell high person?. 

Wait...I thought the goal was to buy low when everything is on sale, right?

I don't have a crystal ball, so no.

What you're describing is market timing - if that's your investment strategy, you are wise to stay out of the market.

Are you perhaps calling that "the top is in?"

I can guarantee you that my investment portfolio consists of more "real employees, buildings, businesses, brands. and lots of other things" than whatever you own.  That's perfectly fine if it's your strategy but don't pretend that you're better diversified in real assets than a selection of index funds are.

I hope for your sake that your businesses don't crumble during the inevitable economic meltdown that you're predicting.
« Last Edit: December 04, 2017, 08:23:46 PM by JLee »

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #595 on: December 04, 2017, 09:00:03 PM »
Not market timing
Market observation and a little common sense.
Enjoy the ride

JLee

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Re: Do you regret paying off your mortgage early?
« Reply #596 on: December 04, 2017, 09:02:39 PM »
Not market timing
Market observation and a little common sense.
Enjoy the ride

...with investment decisions made with "common sense" after "market observation.

That's market timing. It doesn't end well.

slythr

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Re: Do you regret paying off your mortgage early?
« Reply #597 on: December 04, 2017, 09:35:41 PM »
Not market timing
Market observation and a little common sense.
Enjoy the ride

...with investment decisions made with "common sense" after "market observation.

That's market timing. It doesn't end well.

Only if you play the game
It will end just fine for me, cause I don't play.

Telecaster

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Re: Do you regret paying off your mortgage early?
« Reply #598 on: December 04, 2017, 09:57:54 PM »
Wait...I thought the goal was to buy low when everything is on sale, right?

^ That's all you need to know right there folks. 

Dicey

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Re: Do you regret paying off your mortgage early?
« Reply #599 on: December 05, 2017, 02:40:20 AM »
Gosh, I chose an interesting time to excuse myself from this debate...

Does anyone else find it interesting that every single one of "slythr's" posts to date are on this thread?. "slythr" has literally not a posted a single word anywhere else on this whole forum. At this writing, "slythr" has 39 posts.

Y'all can debate and discuss whatever that means while I go back to calmly contemplating my navel, or brand-new car shopping, or....something.
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