Hello all,

I have a few questions about the "You can retire as soon as you save up 25 times your annual spending" guideline. I'm sure they have been addressed somewhere in the blog or forum, but I'm having a hard time finding them, so forgive me if I'm asking a question that's already been answered.

1. That 25 times amount, is the value of your investment assets/portfolio, NOT Net Worth, correct?

2. If that IS indeed the case, it seems to me that savings should almost *always *be directed towards your investments and NOT your mortgage. I mean, I understand the value of applying it towards your mortgage (you get a guaranteed rate of return equal to your mortgage rate), especially if that mortgage interest rate is high. But, while that may be the case, and it increases your net worth, you are actually not much closer to retirement than you were before you made that extra mortgage payment. Although obviously it reduces the amount of time it takes to pay off your mortgage. Is that the whole point? That if you can pay off your mortgage let's say, 10 years before you otherwise would have, then you are 10 years closer to retirement, because then your "annual spending" is reduced by that much? I guess my confusion lies in the fact that if someone has a 30 year mortgage, and wants to retire in 10 or 15 years, it seems *extremely *difficult to get that mortgage down to that number (10 or 15 years) with extra payments. It seems like you'd almost always be better off increasing your investment assets, unless you are *so *close to paying off your mortgage that you might be able to pay it off soon.

Am I making any sense here? Do you all understand where I am coming from?

Thanks for all your help!

Jadambomb