Ok now im confused on making the heloc payment. Maybe i should pay off heloc with the extra 1k, leave the mortgage with just bi weekly , stash the rest to ef and max out husband 401k for 2016 ?? Or throw what was extra 1k mortgage making 2k heloc payment? Then save when heloc is almost paid?
OK... let's see if we can sort this out together. What is confusing to me is why you are currently throwing extra money towards the mortgage and the HELOC and keeping a 10-month emergency fund (at ≤1% rates), while one of your stated goals it to save up enough for a rental property. Your approach doesn't necessarily fit your goals.
first: the HELOC. with the lowest interest rate (4%) you could let this ride and pay the minimum, OR you could take
csprof's advice and pay it off because it will increase your monthly cashflow. Truthfully, either would be fine, but if you want to pay it off do it as quickly as possible - you have the assets ($2k/month in surplus cash plus quite abit in your ER fund) that you could zero out your HELOC in just a few months. Ask yourself this: Is there an advantage to having my HELOC gone right now? Possible reasons include needing a HELOC paid off to refinance to a lower rate or take out a mortgage on a rental property, the desire to have increased cashflow each month (useful if you get laid off... but you do have that emergency fund to cover that already).
next, the mortgage. At 4.275% it's higher than your HELOC, and so mathematically it makes more sense to pay this down faster than the HELOC (except for reasons outlined above). Also, it's quite a bit higher than current rates, so you might be able to refinance right now to save tens of thousands$. Definitely check out the refinance option. Beyond that, a rate of 4.275% is in that "middle ground" where you can either choose to pay it off as fast as possible or you can decide to put all available surplus cash into long-term investments. Remember that your debt is an inflation hedge and that your mortgage interest is tax deductible, so if we assume 2% inflation over the next decade (very low) and if you benefit from your mortgage interest then this debt is only costing you ~1.5-2% per year. That's still very low, and why I would personally put everything extra towards investments. But... there's no "wrong" answer. One GOOD reason for paying down your mortgage ASAP is if you are underwater or close to being underwater. Until your have a lot of equity in your home it can become a trap should you need to suddenly relocate. A HELOC adds to this problem.
next - the 401(k). You should max them both out. Do this before you do anything else.
For extreme bonus points, check out the
Mega-backdoor ROTH strategy, which could allow you to contribute as much as $53/k per person into retirement accounts with very little in taxes, ever.
next - saving in taxable accounts (e.g. a low-cost market index fund). One of your stated goals is that you want to purchase rental properties in the near future. If you are going to do this, you should save at least 20% (perhaps more... perhaps a lot more) in order to not have PMI and to afford to cover renovations to maximize your profits and vacancies when things don't go according to plan. This means putting a lot towards taxable accounts. Also, I find it really dangerous when people rapidly pay down their mortgage but have little/no other investments. Basically, their NW is tied up in one single thing: the house. This has the potential for going horribly wrong: houses can go down in value, you may have to sell during the wrong 'market', and it's harder to get value out of your home than it is from an index fund. Bottom line; if you want to start buying rental properties you need to start saving a lot in taxable accounts.
all of this gets back to what your personal goals and risk tolerances are. To help guide you, I'd create your own
Investment Policy Statment (IPS) that will help guide you in making decisions that match your goals. Plus, you can always post questions here and even a case-study if you like.