I am looking for advice on how to invest $1000 a month of extra cash we have on hand. Here are our options:
Pay down our mortgage. Currently we owe $250,000 on our home worth $550,000. Our interest rate is 3.875%. We recently refinanced so we have about 28 years left on the mortgage. We plan to sell and downgrade in the next 7-10 years.
Add to our two kids’ college funds. We currently have about $13,000 each in 529 funds. Our oldest will enter college in 4.5 years, our youngest 7.5 years. We currently contribute $100 per month to each account. For each $1000 contributed it equates to about $100 back on our tax return (up to $4400 per year).
Increase our contributions to our 503b accounts. We currently contribute $450 each to our funds that are worth $88,000 and $65,000. We are currently aged 46-47, so we have about 12-13 years before we can access these accounts without penalty.
Start something new--such as a Vanguard Index Fund.
What is our best move? We have been socking it away in a nearly worthless savings account and would like to grow this stash!