Thanks for the advice. My wife is a federal government employee and I am provincial. Our pensions are very solid, but the idea is to retire early anyway, so maybe I shouldn't be so focused on the pension contribution.
We do live in Canada, an hour from Toronto which explains the home value somewhat. It is a 3200 sq foot home (not including unfinished basement), which we do not need at the moment, however kids are in the future plans at some point.
We did not purchase the home for $660,000. That is it's appraised value. We purchased for $540,000. I understand zero savings is not ideal, however we did pay off considerable school debts, and saved a good stache for the down payment of our house.
I also agree that it is a lot of debt to carry. Selling the house and purchasing a smaller home could be a good option. Also there is a realistic chance my wife will be transferred to a new city in the next 5 years, in which case work would pay all relocation costs and closing costs on the sale of our property..which could add up to a lot of money in our case.
Again, thanks for the advice!