Advice on Road to FI

[crazy30]

Facts: we have a 310k 30 yr mortgage at 4.275%, 18k heloc at 4% , no credit card debts or other debts, 10 months emergency fund, maxed roth, i am maxing 18k 401 and husband at 8k (we plan to max out next yr) , maxed out hsa... We used to be in 25% tax bracket but with all the deductions we might hit 15% this year. Currently we pay bi weekly 780 plus extra 1k on mortgage , then 110.31 plus extra 1000 on heloc... We want to save up for a rental property but I am now confused on where to start (pay off mortgage? Retirement? Investment?) . The catch is we are in early 30s but we just started funding our retirement from scratch since we focused on the home downpayment. Obviously, since we pay extra 2k on 2 mortgage, our savings are not going up unlike when we were saving up for a home. Should I stop paying extra on the 2 mortgages and just keep stashing money in a tax account?

PS. I am desperate. In my peers I cannot find anyone who is on the same page as I am (meaning nobody wants to talk about 401k, hsa or investing)

Thank you everyone!

[Lucky Girl]

Welcome Crazy30!  You are in the right place.  You may want to do a full case study in the Ask a Mustachian section for more detailed advice, but I think most people here will tell you the same thing. 

You have a fairly low interest rate, so the general recommendation is to stop overpaying the mortgage and just pay the minimum.  Use the rest to invest in a taxable account (VTSAX or similar) or save in a decent interest-bearing account to buy your rental property.  Reasoning:  the stock market will give you a better return than your mortgages (average 6-8% versus 4.25%).  If you intend to buy your rental in the next three years you may not want to put the savings into the market, which is why I recommend the interest-bearing account.  Interest rates are very low right now though, so if you don't mind delaying your purchase due to a market downturn, I'd recommend just sticking it in the market till you are ready to use it.

You're on the right track, best of luck!

[crazy30]

Thank you Lucky Girl! I knew I was doing something wrong even if it feels right hahaha. I will definitely post it at the other section although your answer helped a lot!

[jtriplett]

You're actually in an enviable position.  You're building wealth, even if it is going a lot into your house, these days that's tough to do by the early 30's. 

To gain FI, I'd definitely get more real estate and keep buying real estate, over time it's probably the best and biggest wealth builder with built in cash flow in existence.  Keep saving for the investment real estate downpayment.  Find a location where you can get houses for $100k that rent for 1000 or so, these areas tend to appreciate over time better than the $50k houses. 

Good luck, and celebrate that you have come this far!!