>>I did that years ago. I got tired of paying every month, so I sent them a check for $47,000. It made a dent in my finances, but that’s when I really started making progress saving.<<
Paying off that much that early is always a tough call. If you had a low interest rate you may have been better of investing that money (unless it was just lying around waiting to be used).
Paying off that much can lead to a risk of being house-rich and cash poor.
But it is an individual decision. It is clear you despise debt as much as I. But I just couldn’t let my good interest rate just go away (even if I did pay off early).
“Paying off that much that early is always a tough call. If you had a low interest rate you may have been better of investing that money (unless it was just lying around waiting to be used).
Paying off that much can lead to a risk of being house-rich and cash poor.
But it is an individual decision. It is clear you despise debt as much as I. But I just couldn’t let my good interest rate just go away (even if I did pay off early).”
The APR I was paying at the time I “paid it off” was 6.95% And I had RE-finanaced _down_ to that rate from an original rate around 8.5% from when I bought it in 1988.
There is NO comparison to being mortgage-burdened vis-a-vis being mortgage-free. Free wins every time in my book.
Two things I have done greatly increased my personal savings rate:
1. Paid off the mortgage, and...
2. Got out of the 401k at work.
I’ve become convinced that the entire concept of the 401k savings plan was one of the greatest scams ever foisted upon wage-earners. Ours began in 1994 and I pulled out at the end of 2009 (note: where I work there was no “employer contribution” — it was 100% “employee contribution”). Over a 15-year period I contributed $88,147 in wages. When I pulled out, I had $100,756. That’s $16,212 earned over 15 years — virtually nothing. I could have done WAY better by simply paying the taxes “up front” and investing the $$$ in CD’s. Just my experience, YMMV. I should have bought gold coins instead! :)
By the way, when I hired out on my job in 1979, I had a 13-year-old Volkswagen bus and about $40 in life savings. 32 years later, I think I’ve done ok. And when I retire later this year, it will be on the same train as the first one I ran when I was promoted 30 years ago!