Paying off my mortgage

[Donald]

I am looking to pay off my mortgage soon. The money to pay it off came from the sale of my previous house. It's currently in an S&P Index Fund. And a few individual stocks. Things are looking good for the S&P to hit 5000 next year and inflation to drop to 2% and the Fed to cut the rate maybe in March. I wonder when to sell S&P Index Fund. While things look pretty certain. Possibly sell a portion of the index fund as the S&P moves to 4800 then more at 4900 then the rest at 5000

 

[danez_yoda]

Timing the market is a roll of the dice. You need to consider of paying off the mortgage is worth losing what the money is currently invested in. How long does your current mortgage have. If its 5+ years and your rate is less than 5% then you are likely better of leaving it in the market and just paying it off on time.

There are other ways like just adding principal payments each month to your bill to speed up the payout date. Does not need to be all or nothing.

I'm a Dave Ramsey fan but I do about 70% of what he suggest. Its worked very well for me over the last 25 years.

 

[fantastic]

Keep the money invested and pay out the monthly payment UNLESS you're paying like 5%+ or more on the borrowed money then it may make sense.

 

[Slick3914]

Depending on the rate, you may be better off continuing to make payments.

 

[oldgrayman]

Don't just consider interest rates , etc. Cash flow is also important . Will the extra money every month make your life easier ?

 

[Donald]

My wife is retired with a pension. I am planning on retiring next June. Trying to get everything paid off.

I am well aware one cannot time the market. But in most of the cases where the Fed dropped the rate the stock market has risen.

 

[Bluestream]

What is th interest rate? If its low, take the money and buy an investment grade bond at 5% and let them pay off the morgate over time. You keep the spread

 

[wwillson]

But in most of the cases where the Fed dropped the rate the stock market has risen.

The rate cuts are mostly priced into the market and most see a sideways 2024 market. There are still many predictions of a mild recession in 2024, although it's effects could be marginalized because it won't be called what it is. Don't count on the S&P hitting 5000.

If its low, take the money and buy an investment grade bond at 5% and let them pay off the mortgage over time.

I agree, plus as interest rates go down the same bonds will make you considerably more than 5%.

 

[Warstud]

Timing the market is a roll of the dice. You need to consider of paying off the mortgage is worth losing what the money is currently invested in. How long does your current mortgage have. If its 5+ years and your rate is less than 5% then you are likely better of leaving it in the market and just paying it off on time.

There are other ways like just adding principal payments each month to your bill to speed up the payout date. Does not need to be all or nothing.

That's more like Predicting The Market . Just add extra to your principal every month or pay bi-weekly

 

[Jarlaxle]

Are you planning to stay or move when you retire?

 

[gman2304]

There are other ways like just adding principal payments each month to your bill to speed up the payout date. Does not need to be all or nothing.

I paid my house off 8 years early by doing this. I’ve been debt free since!

 

[RhondaHonda]

How one are you and how much is a few percent either way really good to impact your life? The feeling of owing nothing to anybody short of taxes is great and not always easy to quantify against an S&P Index.

 

[ATex7239]

That close to retirement I’d say just pay that sucker off.

 

[dishdude]

There's no wrong answer here, it is more your personal goals and comfort level. Paying mine off was liberating and I don't regret it one bit.

 

[Danno]

What is th interest rate? If its low, take the money and buy an investment grade bond at 5% and let them pay off the morgate over time. You keep the spread

I'm doing this right now. My mortgage is half the rate I can get in tax sheltered guaranteed interest accounts. No incentive to pay back early.

 

[wpod]

Give it some thought . I bought my first house in 1976 and paid it off by 1988 I liked it. I would depending on the interest rate and what your payment is and how much money [cash stocks etc ] and comfort level it could be good paid off or it could be good making the monthly payments.

 

[Gyro Gearloose]

I'm with the dishdude about payoff being liberating. HOWEVER, if you scored a mortgage rate under 4% back during the heyday, and depending on your tax rates, it could be financially more lucrative to hang on to the mortgage and just make the payments out of the funds while they grow on average at twice that rate.

 

[Donald]

Are you planning to stay or move when you retire?

The house is my retirement home.

 

[Mackelroy]

My wife is retired with a pension. I am planning on retiring next June. Trying to get everything paid off.

I am well aware one cannot time the market. But in most of the cases where the Fed dropped the rate the stock market has risen.

Really why would the Fed drop the rate? whens its close to normal Even one of the Fed members has come out and said, there really has been no discussion to drop rates next year.

Only if the stock market tanks and the economy, would Fed drop the rates. imo

dropping rates they'd be right back to were they were in 23 with escallating inflation and sky rocketing CC borrowing funded by China.

This country has major financial issues

 

[fozzdesy2001]

I paid my house off 8 years early by doing this. I’ve been debt free since!

I did the same 10 years ago with the last 5K in one lump sum. Life has been way better with NO mortgage!