I was a little nervous about paying off the house, but I took Dave's advice and paid off the house. It was the best move I ever made. It reduced the stress of having a debt/payment, and now I am amazed how fast I am accumulating wealth with no house payment.
I felt the same way. Still doubting my decision. My mortgage was small enough that it makes no huge impact. Now, to build that account back up feels like climbing mountain in slow motion. 🙏🙏🙏
@@mlovespring7892Congrats, you did the right thing. You don't have a mortgage and don't have to pay rent, you are in a special group. You will appreciate it more as time goes on, The doubt stops today.
I recommend diversifying your investments by considering stocks alongside real estate. During a recession, there are potential buying opportunities in the stock market if approached cautiously. Additionally, market volatility can offer short-term buying and selling opportunities. However, please note that this is not financial advice. It's important to be proactive in investing as cash may not be the most advantageous option during these times.
you are completely right, Advisors have information and paths that are not disclosed to the public.. I profited $560k in 2023 under the tutelage of my Fiduciary-counselor. Am I selling? Absolutely not.. I am going to sit back and observe how this all plays out.
Thank you so much for your helpful tip! I was able to verify the person and book a call session with her. She seems very proficient and I'm really grateful for your guidance
I want to do the same because it's so tempting and wanting to be completely debt free. In a month I will be done with step 3 and would have 56k left on my mortgage. I could pay off that mortgage by Xmas so I am really tempted to do that. However, I also feel like it was the Ramsey steps and plans that got me this far and therefore I should continue to follow his exact steps/plans. Decisions decisions.
My wife and I's monthly payment was $3415 month. We would pay an extra $500 a month towards the principal. We currently just refinanced to get a lower interest rate and to get off of PMI. Our new monthly payment is $2918 a month. We plan on still paying $3700 a month but are now going to do bi-monthly payments.
Putting well-earned money into the stock market can be over emphasized for first-time investors, unlike a bank where interest is sure thing! Well, basically times are uncertain, the market is out of control, and banks are gradually failing. I am working on a ballpark estimate of $5M for retirement, and I have a good 6-figure loaded up for this, could there be any opportunity for a boomer like me? I'm nearly 60.
Given the prevailing market conditions and the potential risks associated with the current economy, I would recommend refraining from investing in stocks for now. Instead, it would be prudent to consider retaining a portion of your assets in gold. Alternatively, seeking advice from a financial advisor could provide valuable guidance in this matter.
Right, I've been in constant touch with a fiinancial-analyst since covid . You know these days it's really easy to buy into trending stock`s, but the task is determining when to buy or sell . My advisorr decides entry and exit commands on my portfoliio, I've accrued over $300k from an initially stagnant reserve of $150K.
Cant reveal much info, Kate Elizabeth Amdall is the shrewd advisor responsible for my portfolio success, it's only right you look her up and confirm yourself.
Age is the critical factor here (outside of income of course). I decided to get everything including the house paid off by the time I was 43. I would say we lived more intensely than intentional but we accelerated how quickly we could really start to enjoy life like few we know our age. No regrets tightening the screws for a few years knowing the end result.
I have 3 paid off homes and is far better than investing in other real state because it shrinks your bottom line…. Living rent free and Collecting rent on 2 paid out homes generates me about 9k per month…. Again to each their own.
It depends. One size does not fit all. Daves plan fits a lot of people well who have no idea about finances. Its simple to understand and follow and will leave them in a better position.
the answer to that question is dictated by what your interest rate is, how long you plan on living there, and how aggressive you will invest. If you don't plan on living there, and you would like to be more aggressive with your investments, then that's a great path. If you don't plan on investing over the 15%, than put it towards the debt
I think most of people are afraid of missing some "good investment" opportunities. Then, you will have two stresses at the moment: either worries about investment or the mortgage debt. However, if you get rid of the mortgage debt early, you can solely focus on the investment later on. It's never too late to invest and that is just my personal opinion. On the other side, If you find a way to optimize the return from investment + debt, that can also turns out great. Just don't feel too stress out about so many options in front of you and remember to choose what you could suit you the best. I think many people ignore the fact that life is about enjoyment instead of stress out about things. At end of the day, it is just smart to take a realistic look at what's ahead of you (and your family) and give yourself the best opportunities to be happy.
Paying off house vs. investing. Depends on your mortgage interest rate, age, divorce status and what you are investing in. Peace of mind owning you house paid off worth more than investing gains.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Don’t pay off your mortgage. Put all the extra money and Max out of your retirement accounts. My nest egg now generates $400k per year because I was not concerned about paying off the mortgage.
Agreed. At 22 I started investing in my IRA. Today I have both the IRA and a separate Brokerage Account. I have a healthy balance sheet and paid 100% for my children to go to college. I also have a mortgage that I have been paying forever. It takes $$$ to live. Sure it would be nice not having a home loan, but at 2.9% for a 30 year fixed vs. % in the Stock Market.......... hmmmmmmmm. I think I did good.
@@superslyko123 You are wrong even with 2.9% you are paying thousands of dollars extra over the life of your mortgage. Any mortgage calculator online would show you how much money you been bleeding and still bleed for that mortgage (at-least double the value of your house). If seeing that much money going from your pocket to the lender's doesn't set a fire in your pants then you have no hope and you can keep doing what you been doing.
@@MJ-cf9nl Hmmmm. Let's simply do the math. A fixed rate Mortgage at 2.9% vs. inflation which is currently 5% or buying into the S&P 500 at 10% historical average. Yup, it's OK, I'm good.
@@MJ-cf9nl plus when you consider it's cheeper to pay it off with future money due to inflation . You are wasting money by paying it off now. Everything has a cost. The opportunity cost lost by paying off the mortgage early is way way more than the money spent paying ur mortgage every month. But hey waste as much as you want. It's the American dream these days...
I’m in this situation mortgage fix ends in a month and I’m debating whether to pay it off . It’s only 24500 to pay . And I’ve more than 4times that in savings .
Creating extra cash flow and saving that money is important. Sending that extra money to the lender, where you lose the access and use of the money is at best questionable. Paying extra towards your mortgage makes you illiquid, it does reduce the amount of interest you owe. But It does NOT lower your monthly payment. That is fixed for 30 years. And if god forbid you lose your job, the extra money you sent to the bank that is now equity. Can only be accessed by borrowing it. Which you will not be able to do, because you are not working. Save money yes, but keep it liquid and accessible to you. Not the lender.
Hmmm… what’s the interest on that loan? If a bank loans me money at 3% and I can make 5% out of it, I do it (you do have to be intentional though and invest that amount). There is definitely risk involved and an emotional side to this equation and I can understand why one may want pay off their house first, but it’s not the absolute rational decision to make.
Yes! First make sure you are investing 15% a month in a matched 401k and Roth IRAs ( max 7k per person in 2024) and then start dining your kid’s education ( Dave doesn’t specify an amount, but whatever you think is going to get you to your goal by the time the kid is 18) and then any extra goes on paying off the mortgage. For some people with big incomes all three might be happening simultaneously. For the rest of us it might be that we wait until our kids education is funded to pay off the mortgage.
I’ve been going back and forth with how to pay our house as well. We are military and purchasing a home, but will probably sell in about 5 years when my husband retires. Idk if I should put everything extra outside of 15% investment towards the home or invest extra since we know we are selling the house. Our goal is to eventually buy a house in Florida with cash but in like 8 years. The 3 years after my husband’s retirement will be overseas working. While overseas we invested about 40% of our income and I’m thinking we should continue that since our home is not our forever home. I’m still thinking we can put a little extra on it monthly though. We have no other debt.
When you sell the house, the extra money you put in, you'll get back in the sale. Really comes down to your comfort level. I believe Dave tells everyone to pay the house off because, most people won't actually invest that extra. You always hear people say "invest the extra!" but then they, you know, buy a boat or something silly. Dave "dumbs it down" to where you WILL get to wealth if you stick to it. A loose "invest the extra" plan can lead you away. If you're diligent investing the extra, you will get there too...but the diligence is what kills people.
@@Takar100 thanks! Yeah I have been thinking to do a little of both. We try to live on 1 income while investing and vacationing (or other wants) with the other. I do get why he says pay off the mortgage and it makes sense in most cases but for us who invest and know we are moving, I kind of go back and forth. Even for our home, it is a modest home and will be used for what we need now. I wanted extra space but wasn’t willing to pay for it especially in today’s market. We normally rent, but rent has doubles since we last lived in this area. I did the math and we would be paying over $100k in rent in 5 years so that was not financially smart.
No wrong answer. If you know you are going to sell in 5-years then I say answer depends upon what your mortgage interest rate is. If it's 5% or above I would probably pay down the mortgage however of it's low say 3% or less I would invest it.
Wrong answer. Go for an interest only and put the rest in to investments. Saving 2% when you could be making 10% (by Dave's admission). Run the numbers over a lifetime and it's colossal.
Investing is the way to go unless you have high interest debt and then the priority should be to pay that debt off first. It’s better to draw 8-12%+ on large capital than burning significant capital to be debt free.
Investing in real estate is a great asset but the house that you’re living in is a liability. Which means that the house where you live is not a form of investment because you’ll be paying monthly house insurance, depreciation/repairs of the house, electric/water and yearly tax eventhough it’s already been paid off. -just saying because they said that, once you’re debt free, you have no bills to pay. In addition, most of the people who posted some comments mentioned about the house which they considered as an investment which is somewhat true if you sell the house and keep the money but you’ll lose the house 😂
She said she wants to retire early...but aggressively paying down mortgage delays putting more money into retirement investments to grow. She's a finance professional who makes good money so likely has a low mortgage rate too...why throw all extra money at the mortgage when those dollars can do more invested for the next 7-10 years? Heck even high yield savings is getting more interest than the avg. Mortgage rate from when everyone refinanced a few years ago
I don’t understand why you just don’t open up a brokerage account and invest in index fund collecting nine or 10% interest on the next 10 years and use that money to pay off your house.
I agree in general that paying off the house is a better option. However, this isn't always the case, you have to weigh what you save by paying the mortgage down as opposed to investing. For example a 15 year loan at 2.5% - should be paid off instead of invest aggressive while the market is down? I'm not sure that makes sense. Again you have to crunch the numbers, and all the numbers.
Its worse here, our economy is like a flailing fish, fighting for its life. The normal state of the U.S. economy is actually very bad. Because of this it goes into convulsive spasms fighting to grow any way it can out of desperation. Tricks, gimmicks, rule changes try to stimulate the economy and prevent it from falling but they only bring temporary relief to people since, when you factor in inflation we are declining.
funny thing is everyone talking all this making money investing when it is proven only 20 percent make money in the market so get rid of your mortgage first then investments not that big of a deal
I refuse to keep sharing my roof with the bank for longer than I have to. I'm $65k away from paying off my mortgage, my deadline is Dec. 2022 for a total of 7 years, then I can quit working two jobs.
Use your brains instead of your emotions: a mortgage should cost 3% (if not, refinance!), while a well-balanced investment portfolio should return at least 7%. That means your emotions are *costing you 4% compound interest.*
@@ma93256 stop jumping to conclusions. They might just know that it's good when investments earn significantly more than (currently super-cheap) mortgages.
I’ve taken steps into paying off my house, I managed to put 60k into it this last year… I just turned 28 I’m hoping to have it paid off by the time I turn 30, I have 98k left to pay with 10k in the bank and an 8k emergency fund… the thought of being able to pay off my home feels so good! Still single, debt free with a job I love (full time photographer)… I moved here from Mexico 10 years ago without a penny to my name, I learned english, made good financial decisions… this is the American Dream🙏🏻
I like this answer from Dave. The question is a lot like asking which pedal is more important when driving a car, the gas or the brake? If you're running off a cliff, the brake. If you're in a good stretch of highway, the gas. Same with finances on the road of life. Apply wisdom and figure out your situation.
If you want the house paid off that's a psychological benefit, it's also a better move if you are not doing anything else with the extra money paying the house is good. However, opening up a brokerage and starting up some ETFs is a more optimal move, especially when your returns beats your low mortgage rate.
Look at your budget with only home insurance and property taxes. Are you able to quit your job or maybe work part time once it's paid? Also, do you like the home and area you live? Paying the house off will give you more options and peace. I love how Dave adds in "Giving like no one else". It's such a great way to live once you are debt free.
this is my goal honeslty. I started to late to be rich when i retire but I sure heck would love to not have to work but for taxes and electricity. be pretty dang nice.
If you don't build up retirement income bc you threw all your money at the house to pay off early...how can you quit your job? You need to save more to male up for not saving while you paid the mortgage off
@@danmzuccari1 my ssi retirement would more than cover my bills. anyway I do not think I will retire fully how boring would that be. I am sure I will work 2-3 days a week for the rest of my life for something to do.
@@tymom9313 Yes and no.... if you invest wisely, you can achieve that amount... I know because I have and then some. It does not happen over night. To me, it has EVERYTHING to do with investing. Think of it like a snow ball you push down a hill... it gets bigger and bigger and etc... and then one day you are making good money from your investments.
Oh my God! My heart is really broken reading this. I can imagine what you are passing through but please don't commit suicide. Everything will be alright.
I feel so terrible about what you are going through. There's a solution to this. And the solution is to get back the money. I will advice you look for a reliable professional trader that will trade for you and help you recover your losses. You can beg your husband to give you some time to raise the money
@@carlosdominguez1697 I am also having the same problem. I have lost all my money trading. Please help with the contact of your trader and God will bless you. I have suffered a lot of losses
My mortgage is a 2.5%. My investments are making 12%. Easy decision for me… I actually do put an extra $1,000 per month towards the mortgage for peace of mind however it’s not necessarily finically smart.
@@truckingmoney485 agreed. Question is: will you have a job to pay for your roof during the period of the crash? If you invested instead of paying off, you lost half your investment (40% during the recent flash crash), and got laid off... Congrats, you lose your house. Happened to many in 2020, happened to lots more in 2007-2010. Greed and hubris are poisons worthy of being avoided. Edit. People didn't learn a thing from 2007. Y'all keep trucking along, I'll be paid off smoking cigars in the yard in peace with no worries.
paying the house off early is a literal guaranteed return on your investment, opposed to stocks where nothing is guaranteed. you will save money on interest (possibly six figures) which is the same thing as making 100k....
@@Silidons91 There is no possible argument that makes paying off the house a better investment than investing the same money in index funds. It's math. Only advantage is mental, but that could cost you millions in the end.
@@mastermind6767 here's an argument: tax free, guaranteed returns. i'm set to save almost 100,000 over the course of the next 10 years just by putting an additional $500 payment each month on my mortgage. and that's on top of investing.
@@Silidons91 have you calculated the same if you invested an earned the 7% average annual return on that $500/month after inflation in the same timeframe?
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Our mortgage is paid off but I still have to set aside $500/month just to cover our property taxes and homeowner's insurance -- which is kind of a bummer, but that's life.
@@carlostosado8965 just built….lol…I’m a glutton for punishment. Good news is that I just learned today my social security will pay out almost $60k/yr when I turn 67. That will easily cover my nut and then some in retirement. So, I get to stay in my overpriced home.
Everyone hates inflation but are happy when that $200,000 house they bought sells for $400,000. If housing cost rise with inflation all you are doing is breaking even minus the interest you paid.
Wanting to pay off my house is making me look for additional income opportunities I otherwise wouldn’t have due to comfort with a 30 year mortgage. I would not work all these side gigs just to invest the money. I know this because I didn’t do it until I had the goal for my “forever home” pushing me to want to earn more. I’ve almost doubled my salary in a few years just because I want to pay off my next house fast. I also invest still. It’s not (all) passive income, but it’s so rewarding.
Does anyone on this show ever question...What's your mortgage interest rate? There are alot of people with mortgage rates just over 2% and CDs are well over 5%. If CDs continue to rise, paying down your mortage will be a very poor decision.
Your living in the dark ages. It's not rocket science. Make your $$$ work harder for you. 3% Mortgage or 10%+ returns on a given investment, or S&P 500
You are forgetting the ‘risk’ factor here. I fear you are not feeling the risk. I feel it everyday therefore I only do 15% to Roth’s and the rest to housing.
@@harryl7946 your putting yourself in more risk by locking your cash behind a non liquid asset that you can't access unless you sell or refinance. Have an emergency fund and then invest as much as you can.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
My opinion is if you have an interest rate south of about 3 percent invest unless your mortgage is gonna take u into retirement years otherwise I would put enough extra towards the mortgage to pay it off right before you retire.
If you have issues saving, it is cause you bought to much house. At the same time that could be a good thing... cause you house is worth so much more today. But... it hinders your investing.
Homes in San Francisco average $1.6 million to $2 million for a normal house. Taxes and cost of living here are high as well. Being able to save for retirement, contribute to 529 plans and take a vacation once a year is difficult. According to the retirement calculators, I will need approximately $3 million to retire comfortably. In order to reach that goal there is not much leftover to spend if you are constantly saving. I am a little behind after the stocks dropped over the past year.
I am 56 retired and pulling $93,000+ a year the only thing I am focused on is paying off the last 65,000 on this house. AFTER it is paid off I will throw that extra $5000. a month into mutuals .... I prefer the security of a paid for house.
@@wetwilly420 probably pension. If it was invested he’d need to have 2.5 million to perpetually withdraw 100k every year without losing the principal. 65k is chump change if you have 2.5M.
Another wife who wants to retire early while her husband continues to work. I see this all the time wives quit their jobs as early as possible and put the load on the husband. I do not think women realize the pressure they put on their husbands.
I lost over $60K when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I find one source to recover my money, at least $9k profits weekly. Thanks so much Mrs Gretchen Dougherty
l also invest with mrs Gretchen Dougherty, she charges a 20% commission on the profit made after each trading session, which is fair compared to the effort she put in to make huge profits.
My first investment in mrs.Gretchen Dougherty gave me the confidence that led me to invest without fear of loss. I have already taken 3 of my friends to their guide and they are fine.
I am regretting not investing in stocks ever since but still grateful i kept money in the money market. With about $200k maturing soon, i plan investing in the stock market. What stocks should I look into as a newbie to safely grow my money?
Thats when you hire someone to manage your money. You need a (CFP) straight up! personally, I would invest in ETF's and also love investing in individual stocks.
I took charge of my portfolio but faced losses in 2022. Realizing the need for a change, I sought advice from a fiduciary advisor. Through restructuring and diversification with dividend stocks, ETFs, Mutual funds, and REITs, my $1.2M portfolio surged, yielding an annualized gain of 28%.
Whitney Kay Stacy is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
Remember to follow the baby steps... You pay off the house early while investing 15% for retirement in the background! Do not become so focused on paying off your house that you neglect saving/investing. You cannot get those years of compounding back.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Both also depends where we are in the market cycle. As of 2022 I would focus more on the house. As prices come down on everything as we are in recession mode focus more on investing.
its a matter of the heart...not math. debt free gives you more than just money. Put all your cash on investments once debt free. ( that plan will win every time ). Listen to Dave a bit more. cheers
@@drhoughton5481 If you lose out on investing the first five or ten years of your career because you are paying off that mortgage early, you will have lost 100s of thousands if not a million for your retirement.
If she is in finance, she should know the smarter play is not to pay down the low-interest mortgage any faster than she has to. Investing is the way to go. Let your investments pay off your house 3-6 years down the road if you really want to pay it off. The probability is higher you will both pay it off faster and be wealthier in the long run.
@@dembenonsgals1321 Hi, sure! It's all about the cost of capital and where you expect the best returns over a particular investment period. There are no long-term periods where the S&P 500 have not beaten a 2.5% mortgage, net of tax benefits. In all 15-year scenarios, you'd pay off your mortgage faster if you just invested in the stock market and paid off your house when your portfolio balance equals your mortgage balance. And once you have enough wealth where you "could" pay it off, you will probably realize that you'd rather keep the safe and cheap 2.5% mortgage debt as long as you can while you let your portfolio continue to compound at a rate much higher than 2.5%. Paying off your 2.5% mortgage directly will still lead to building wealth, just not nearly as much.
@@CalmerThanYouAre1 I learned this at 27 years old when I bought my house. $220,000 mortgage, 3% interest. I chose to max out my Roth 401k in and S & p 500 index fund instead of paying the mortgage off early. By the time I’m ready to retire I’ll just write a check for whatever is still owed on the mortgage, and I’ll hopefully have several million dollars leftover to retire on.
Thie caller makes $14,000 monthly. I am pretty sure she can invest and knock out the mortgage. Many with no consumer debt can do both at the same time. Also, failing to add risk into your mathematical calculation is a flawed concept.
@@jaywalk6628 risk has been accounted for. She has a higher risk of missing the upside than going bankrupt due to the downside, in her situation. The “what about risk” mantra typically only argues risk from one side and doesn’t account for the true cost of capital and how the individual is positioned financially. Psychological factors than can’t be quantified are also important, and should be considered. But risk tolerance isn’t the same thing as risk capacity. And the probabilities for success are based on actual data, not subjective assessments of perceived risk. Everyone should do what they are comfortable with, but I’m very happy I have held onto all my 2.5% mortgages and chosen to remain invested in additional appreciating assets instead. Achieved FI faster ✅. Net worth higher ✅. Diversified income streams ✅. Risk much lower ✅.
@@aaront936 wait of one pays a 30 year mortgage in 10 years they save the 3 percent for 20 years AND are able to invest the entire amount after the 10 year repayment. That seems like 3 percent saved plus 100 percent to invest after 10 years.
I really can't say about paying off the house as a priority, but it surely is freeing! You won't know the feeling until you do it. And then you're free to do whatever you like...
It is difficult to make exact projections for the housing market as it is still unclear how quickly or to what degree the Federal Reserve will reduce inflation and borrowing costs without having a substantial negative impact on demand from consumers for anything from houses to cars.
I agree, It's not just the prices, but also the increasing interest rates that are making it more difficult for people to afford homes. With a good FA you can make up your portfolio.
Agreed. I deal with an investment advisor for this reason. I currently have over $800k invested in a diversified portfolio that has grown exponentially and is suitable for all market seasons. Our current project for this year is a more concrete ballpark target.
How can I participate in this? I sincerely aspire to establish a secure financlal future and am eager to participate. Who is the driving force behind your success?
I appreciate it. After searching her name online and reviewing her credentials, I'm quite impressed. I've contacted her as I could use all the help I can get. A call has been scheduled.
If you're young enough, investing can be the better option. "Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn't, pays it" - Albert Einstein
If we are being honest with ourselves, taxes may be a major pain, just like they are for the wealthy. Taxes on income, goods and services, real estate, etc. It's wonderful to pay taxes, but we may also establish our own tax havens. Since stock market appreciation is not taxed, I personally invest most of my money there. When I sell, though, I discover ways to make the profit tax-deductible. I’ve been sitting on over $745K equity from a home sale and I’m not sure where to go from here, is it a good time to buy or do I wait?
(I find it upsetting that such basic concepts are not taught in schools, yet people constantly whine about taxing the wealthy as though they should be made to pay for their own ignorance. I have been utilizing the market to insulate myself from the market, doing the same thing. However, because I detest making routine decisions, I just invest through a financial advisor, earning decent returns and avoiding taxes with minimal effort.)
@@MrGravity304 I've been doing this same thing myself. Can't get into trouble with the IRS when I have no income and all my money is in stocks. I don't like doing the work though. Lol. So I just invest through an advisor who does the stock picking. My money grows, and I'm tax-free.
@terrygeorge3545 I can honestly relate. It's not as easy as it may sound and requires some sacrifices but it is definitely rewarding. I don't know if I am permitted to go into details here, but her name is NICOLE DESIREE SIMON. Was in the news a lot in 2018. You may look her up for more.
Yeah talk about not even first world problems How would be absolutely ecstatic to make even a third of that amount per month living in mississippi.. Seeing as how I am debt free and on baby step four
Paying off the house is safe, but safe won't make you wealthy. I'm ok with the bank holding onto my debt for now while I invest. When the time comes, I will pay the house off all at once, but by paying the house off early, you're losing so much compound interest that you will never get back.
It appears you are unaware of the compound interest from the mortgage debt. Also unaware about tax from investment earnings vs extra repayment. You also can not be wealthy when compound interest is also against you.
@@Bobotheclown98 10% growth in the market beats sub 3% mortgage debt. Ramsey will costs you hundreds of thousands of dollars if you follow his baby steps.
@@TheCanineclub At less than 3% interest, it makes no sense to lean into the house. Over the long run my investments will make anywhere from 7-15% interest. Compound interest only works if you're investing regularly. You're wasting valuable time when you're trying to clear your mortgage. I'm not the only one who realizes this, it's a very common mindset when it comes to investments.
I recommend diversifying your investments by considering stocks alongside real estate. During a recession, there are potential buying opportunities in the stock market if approached cautiously. Additionally, market volatility can offer short-term buying and selling opportunities. However, please note that this is not financial advice. It's important to be proactive in investing as cash may not be the most advantageous option during these times.
You’re right! The current market might give opportunities to maximize profit within a short term, but in order to execute such strategy , you must be a skilled practitioner.
A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
Don't give up your company's 401k match. It's a guaranteed 100% return on your money. That beats even the highest credit card interest rate. Look up the financial order of operations.
It’s so crazy to me how much income people that call into dave Ramsey makes.. me and my hubs work full time jobs and clear 40,000.00 per year…. These people make 3+ times what we make, it’s crazy, how the heck can they be in debit, and not have house paid off…..
Paying off a house isn't important. Unless you cannot afford payments at retirement. The best answer would be. Wherever you get the most for your money. If paying off the house. Makes more sense by saving interest. Do it. If your investment will outpace your interest. Do it.
If your investing or paying off the mortgage early either way your onto a winner so give your seleves a break guys its like debating what apple or samsung to get
No one has answered this question yet. If you say you would rather invest than pay off your mortgage, is that the same as saying I’d borrow against my house and invest the money?
Sounds easy but I remember (felt) every market crash since the 70’s. They can leave some ptsd about investing in the stock market. Dave is cocky about the market because he makes millions in income. He could retire well just by putting some of it in a Money Market. Maybe pay a little extra on the house to time it being paid off at retirement, and invest the rest in the market?
@@dhammer6715 i haven’t been around that long, but I did feel 2008-2010 drops. 2020 was big, but I’ve more than doubled since the 2020 drop because I was so aggressive last year. Dave’s answer is so black and white. Its not for everyone
I’m in Oz… this is my situation Mortgage loan $411000 at 6.59% Pa With 30 year loan I pay about total interest $800000 If I pay loan off in 5 years I can pay 1/10 the total interest - only $80000 Simple math… Then after owning the house I get passive rental
Agree. Let pay it off in 5yrs if you can. It likes earn $700k in 5yrs. Better than any risk investment now. My case is $170k at 7.5%. With 25yrs pay about $400k.
Do not waste your peak compounding interest years of your 20's and 30's paying off 3% low interest mortgage debt. Put your money to work and get your army of dollar bills working to make you compounding growth.
What a 🤡 instead of your measly 10-15% investment while holding onto a mortgage you could be doing literally 50-60% when you have a paid off house. You’ll have stacks of cash at that rate
I follow the Dave steps, and you need to consider your own individual circumstance. If you deviate from the steps, be accountable and open to others so if you go in the wrong direction then you will know and then you Must return to Dave's steps. We are on plan to pay off mortgage in 8 years (10 years on a 30yr loan) but investing the rest instead of paying the mortgage off. This is because we are paying off AND making more money than we would if paid to mortgage (2.5%). BUT if we start running into problems, then we are going back to paying off the mortgage. Be accountable.
Generally. if you under 45 and the interest rate is below 5% invest extra and make minimum mortgage payment. If you’re older, it could be more beneficial to pay off the mortgage. However, every situation is different so it would be foolish to use Dave’s one size approach.
I can wipe my house out no real other debt but kill my 401k but can afford put same my house payment is in savings etc plus I do 20%401k about 250a week I am 43 my only bills are utilities or like 500card debt paid clear each month to build credit only reason I got it
For anyone under 40 (likely even 45), you are much better off investing any extra money rather than paying off a low interest rate mortgage. Paying the mortgage first only prevents you from growing your wealth and robs you of the largest parts of compounding results in the future. You just want to pay off that mortgage before you retire an the income slows or stops.
Exactly I always say any type of interest payment below 5%, can literally be put on hold as long as you're taking your extra money and putting it into investments. Yet If you have lot s of loans it's not worth keeping all of that baggage take care of some of the higher interest rate ones a mortgage or maybe two car loans is fine but if you've got a boat loan and another mortgage loan and blah blah blah blah yeah you should probably cut some of those down
@@kartboarder22g17 - I agree. You want to avoid consumer debt. As for additional mortgages, depends what it happening with those properties and the rates as well. But a boat loan would be similar to a car loan and is consumer debt. Now be careful, when you suggest getting rid of the higher rate loans, that is the so-called avalanche method (the CORRECT way to get rid of debt) and Dave doesn't like getting rid of debt faster and at less costs. He'll insist you use the SLOWball-snowball method!! Don't be too smart, Dave doesn't like that! I'm telling you that you're right....but watch your step on this channel. Lot of blind Ramsey disciples.
@Mr. Nielsen PE - You couldn't be more wrong. And Dave Ramsey is absolutely wrong on this issue when he advises it. It's false deductive reasoning which he usually bases on study of people who are ALREADY millionaires. First, I said you want to have it paid off before you retire. Sad you made that sad attempt to make a moot point. Second, you REALLY need to think through your math and more importantly you need to learn about COMPOUNDING.....especially the effects it has in later decades. By focusing on ridding your low rate mortgage earlier in your life (over investing) you have STOLEN one of the largest part of your future retirement funds. You robbed yourself simply to pay off a home that is worth the exact same amount in the future regardless of when it was paid off. Also, I'll add that if you focus on investing first, not only will you have the money to pay off that mortgage throughout, if you ever needed or wanted, but you'd also most likely have it sooner if that was your goal (but then would likely be more aware that you do not want to do it). For what you said in your reply, you really need to learn about compounding. You obviously don't understand it or the mathematical effects to claim it's not logical. The math and the logic say take your time with low rate mortgages and invest, invest, invest. It's only the psychological reward (which Dave loves to focus on) that has any merit at all. But that psych bump comes at a tremendous cost to yourself as it takes from your potential future and earlier financial independence (which you don't have simply because your house is paid off). COMPOUNDING - learn it inside and out!!
@@tomm8025 you are forgetting that once the house is paid that large amount can be invested and the person is investing some while paying off the house.
@@helainehoerning2200 - I repeat, LEARN ABOUT COMPOUNDING! Those early years when you're wasting your money paying off the house rather than investing are the years that would have the biggest effects of compounded results....but instead you LOST those results just to pay off a low rate mortgage on an asset that will be worth exactly the same whether you paid it off now or 25 years from now. Also, learn about the deflation value of future monies and think about how you'd be using less valuable future dollars to make that same payment rather then the more valuable dollars now. Ramsey is completely wrong in this area. Not even a debate. Numbers don't lie, but people can try to skew the data, or in his case make psychological arguments to defend his position. He is beating the same drum he was 30 years ago....back when rates were much higher. If interest rates on mortgages were higher, say even 6%, now we can discuss which is better. But at rates today, not even close. Focusing on paying off the house early will cost you a fortune in lost future monies. If you already made the mistake because you listened to Ramsey, don't calculate how much you COULD have had, cause it will make you sick to know what you did to yourself.
With her income, this lady needs to be talking to a real financial advisor / CPA rather than a radio personality. This couple is in the 24% tax bracket federal and 8.5% Washington DC. The smart move would be to max out their 401k contributions to take advantage of the tax deferments (note: there are income limitations that may apply). Put another way, why pay 32%+ on your money to pay off a 3% mortgage.
I’m convinced by now Dave knows his baby steps is flawed after the individual gets their debt under control. He just can’t amend it because then it would be an admission of a critical and embarrassing flaw with his signature plan. He’s more interested in staying oblivious and wrong than doing what’s right for his audience. For such a religious person he sure doesn’t seem to have any guilt ruining his audiences future for his own personal gain.
The path to paying off the mortgage early is risky too. A paid off house isn’t helpful until it’s 100 percent paid off. Invest the extra money and then when your ready to retire just cut a check to pay off the mortgage. That way you also preserve your liquidity along your path to paying off the mortgage.
![Cody Johnson - I'm Gonna Love You (with Carrie Underwood) [Official Music Video]](http://i.ytimg.com/vi/yy9PuYMU29g/mqdefault.jpg)
I was a little nervous about paying off the house, but I took Dave's advice and paid off the house. It was the best move I ever made. It reduced the stress of having a debt/payment, and now I am amazed how fast I am accumulating wealth with no house payment.
Congrats I pray for that in Jesus Christ name that's awesome what a blessing
I felt the same way. Still doubting my decision. My mortgage was small enough that it makes no huge impact. Now, to build that account back up feels like climbing mountain in slow motion. 🙏🙏🙏
@@mlovespring7892Congrats, you did the right thing. You don't have a mortgage and don't have to pay rent, you are in a special group. You will appreciate it more as time goes on, The doubt stops today.
Exactly;-) Get rid of payments!!!!!!
@@YanilleCastillo Amen! Just keep doing it.
I recommend diversifying your investments by considering stocks alongside real estate. During a recession, there are potential buying opportunities in the stock market if approached cautiously. Additionally, market volatility can offer short-term buying and selling opportunities. However, please note that this is not financial advice. It's important to be proactive in investing as cash may not be the most advantageous option during these times.
you are completely right, Advisors have information and paths that are not disclosed to the public.. I profited $560k in 2023 under the tutelage of my Fiduciary-counselor. Am I selling? Absolutely not.. I am going to sit back and observe how this all plays out.
That's impressive! I could really use the expertise of this manager for my dwindling portfolio. Who’s the professional guiding you?
Actually it’s a Lady, Her name is “Tenley Megan Amerson” So easy and compassionate Lady. You should take a look at her work.
Thank you so much for your helpful tip! I was able to verify the person and book a call session with her. She seems very proficient and I'm really grateful for your guidance
*** SCAM ALERT *** only a fool would use a financial advisor based on a fake RUclips tip!🤦♂️🤦♂️🤦♂️
Im going intense on my house....plan to have it paid off in Oct 2023. I want this mortgage GONE!
Us too, hopefully around 6 months after you.
I want to do the same because it's so tempting and wanting to be completely debt free. In a month I will be done with step 3 and would have 56k left on my mortgage. I could pay off that mortgage by Xmas so I am really tempted to do that. However, I also feel like it was the Ramsey steps and plans that got me this far and therefore I should continue to follow his exact steps/plans. Decisions decisions.
We paid off our house two years ago and are investing like crazy!!
Like it 👍
You can do it! God bless you & your family
My wife and I's monthly payment was $3415 month. We would pay an extra $500 a month towards the principal. We currently just refinanced to get a lower interest rate and to get off of PMI. Our new monthly payment is $2918 a month. We plan on still paying $3700 a month but are now going to do bi-monthly payments.
Putting well-earned money into the stock market can be over emphasized for first-time investors, unlike a bank where interest is sure thing! Well, basically times are uncertain, the market is out of control, and banks are gradually failing. I am working on a ballpark estimate of $5M for retirement, and I have a good 6-figure loaded up for this, could there be any opportunity for a boomer like me? I'm nearly 60.
Given the prevailing market conditions and the potential risks associated with the current economy, I would recommend refraining from investing in stocks for now. Instead, it would be prudent to consider retaining a portion of your assets in gold. Alternatively, seeking advice from a financial advisor could provide valuable guidance in this matter.
Right, I've been in constant touch with a fiinancial-analyst since covid . You know these days it's really easy to buy into trending stock`s, but the task is determining when to buy or sell . My advisorr decides entry and exit commands on my portfoliio, I've accrued over $300k from an initially stagnant reserve of $150K.
Please can you leave the info of your invstment analyst here? I need such luck lol
Cant reveal much info, Kate Elizabeth Amdall is the shrewd advisor responsible for my portfolio success, it's only right you look her up and confirm yourself.
I just checked her out and I have sent her an email. I hope she gets back to me soon.
Age is the critical factor here (outside of income of course). I decided to get everything including the house paid off by the time I was 43. I would say we lived more intensely than intentional but we accelerated how quickly we could really start to enjoy life like few we know our age. No regrets tightening the screws for a few years knowing the end result.
You can never regret paying off the house
Until you do the math on compound interest
I have 3 paid off homes and is far better than investing in other real state because it shrinks your bottom line…. Living rent free and Collecting rent on 2 paid out homes generates me about 9k per month…. Again to each their own.
I went to pay my house off first, but I would’ve had a lot more money how to invest in the stock market hard-core this last year
And that stock portfolio would be down 15% now. Investing NOW is a good idea though.
It depends. One size does not fit all.
Daves plan fits a lot of people well who have no idea about finances. Its simple to understand and follow and will leave them in a better position.
the answer to that question is dictated by what your interest rate is, how long you plan on living there, and how aggressive you will invest. If you don't plan on living there, and you would like to be more aggressive with your investments, then that's a great path. If you don't plan on investing over the 15%, than put it towards the debt
I think most of people are afraid of missing some "good investment" opportunities. Then, you will have two stresses at the moment: either worries about investment or the mortgage debt. However, if you get rid of the mortgage debt early, you can solely focus on the investment later on. It's never too late to invest and that is just my personal opinion. On the other side, If you find a way to optimize the return from investment + debt, that can also turns out great. Just don't feel too stress out about so many options in front of you and remember to choose what you could suit you the best. I think many people ignore the fact that life is about enjoyment instead of stress out about things. At end of the day, it is just smart to take a realistic look at what's ahead of you (and your family) and give yourself the best opportunities to be happy.
Paying off house vs. investing. Depends on your mortgage interest rate, age, divorce status and what you are investing in. Peace of mind owning you house paid off worth more than investing gains.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Opportunity cost was never addressed
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Don’t pay off your mortgage. Put all the extra money and Max out of your retirement accounts. My nest egg now generates $400k per year because I was not concerned about paying off the mortgage.
Please please elaborate. How much did you put in your retirement account for it to generate that? £4 million?
Agreed. At 22 I started investing in my IRA. Today I have both the IRA and a separate Brokerage Account. I have a healthy balance sheet and paid 100% for my children to go to college. I also have a mortgage that I have been paying forever. It takes $$$ to live. Sure it would be nice not having a home loan, but at 2.9% for a 30 year fixed vs. % in the Stock Market.......... hmmmmmmmm. I think I did good.
@@superslyko123 You are wrong even with 2.9% you are paying thousands of dollars extra over the life of your mortgage. Any mortgage calculator online would show you how much money you been bleeding and still bleed for that mortgage (at-least double the value of your house). If seeing that much money going from your pocket to the lender's doesn't set a fire in your pants then you have no hope and you can keep doing what you been doing.
@@MJ-cf9nl Hmmmm. Let's simply do the math. A fixed rate Mortgage at 2.9% vs. inflation which is currently 5% or buying into the S&P 500 at 10% historical average. Yup, it's OK, I'm good.
@@MJ-cf9nl plus when you consider it's cheeper to pay it off with future money due to inflation . You are wasting money by paying it off now. Everything has a cost. The opportunity cost lost by paying off the mortgage early is way way more than the money spent paying ur mortgage every month. But hey waste as much as you want. It's the American dream these days...
I’m in this situation mortgage fix ends in a month and I’m debating whether to pay it off . It’s only 24500 to pay . And I’ve more than 4times that in savings .
Creating extra cash flow and saving that money is important. Sending that extra money to the lender, where you lose the access and use of the money is at best questionable. Paying extra towards your mortgage makes you illiquid, it does reduce the amount of interest you owe. But It does NOT lower your monthly payment. That is fixed for 30 years. And if god forbid you lose your job, the extra money you sent to the bank that is now equity. Can only be accessed by borrowing it. Which you will not be able to do, because you are not working. Save money yes, but keep it liquid and accessible to you. Not the lender.
Hmmm… what’s the interest on that loan? If a bank loans me money at 3% and I can make 5% out of it, I do it (you do have to be intentional though and invest that amount). There is definitely risk involved and an emotional side to this equation and I can understand why one may want pay off their house first, but it’s not the absolute rational decision to make.
Do you invest in children’s college fund & 401K before adding more to the house repayment?
Yes! First make sure you are investing 15% a month in a matched 401k and Roth IRAs ( max 7k per person in 2024) and then start dining your kid’s education ( Dave doesn’t specify an amount, but whatever you think is going to get you to your goal by the time the kid is 18) and then any extra goes on paying off the mortgage. For some people with big incomes all three might be happening simultaneously. For the rest of us it might be that we wait until our kids education is funded to pay off the mortgage.
Very simple. Do a little bit of both.
If you have a 3% mortgage why would you pay it off when you can invest that money for more?
I’ve been going back and forth with how to pay our house as well. We are military and purchasing a home, but will probably sell in about 5 years when my husband retires. Idk if I should put everything extra outside of 15% investment towards the home or invest extra since we know we are selling the house. Our goal is to eventually buy a house in Florida with cash but in like 8 years. The 3 years after my husband’s retirement will be overseas working. While overseas we invested about 40% of our income and I’m thinking we should continue that since our home is not our forever home. I’m still thinking we can put a little extra on it monthly though. We have no other debt.
When you sell the house, the extra money you put in, you'll get back in the sale.
Really comes down to your comfort level. I believe Dave tells everyone to pay the house off because, most people won't actually invest that extra. You always hear people say "invest the extra!" but then they, you know, buy a boat or something silly. Dave "dumbs it down" to where you WILL get to wealth if you stick to it. A loose "invest the extra" plan can lead you away. If you're diligent investing the extra, you will get there too...but the diligence is what kills people.
@@Takar100 thanks! Yeah I have been thinking to do a little of both. We try to live on 1 income while investing and vacationing (or other wants) with the other. I do get why he says pay off the mortgage and it makes sense in most cases but for us who invest and know we are moving, I kind of go back and forth. Even for our home, it is a modest home and will be used for what we need now. I wanted extra space but wasn’t willing to pay for it especially in today’s market. We normally rent, but rent has doubles since we last lived in this area. I did the math and we would be paying over $100k in rent in 5 years so that was not financially smart.
No wrong answer. If you know you are going to sell in 5-years then I say answer depends upon what your mortgage interest rate is. If it's 5% or above I would probably pay down the mortgage however of it's low say 3% or less I would invest it.
@@eq2092 thanks! It’s 2.375%. I actually planned to call Chris with this for Panicked or Pumped bc I felt both lol.
@@ashleyjones5396 if only Chris was still doing panicked or pumped...
Wrong answer. Go for an interest only and put the rest in to investments. Saving 2% when you could be making 10% (by Dave's admission). Run the numbers over a lifetime and it's colossal.
But you sorta become mortgage free way before being ‘mortgage free’ as your payment will be so low compared to your income
Investing is the way to go unless you have high interest debt and then the priority should be to pay that debt off first. It’s better to draw 8-12%+ on large capital than burning significant capital to be debt free.
Investing in real estate is a great asset but the house that you’re living in is a liability. Which means that the house where you live is not a form of investment because you’ll be paying monthly house insurance, depreciation/repairs of the house, electric/water and yearly tax eventhough it’s already been paid off.
-just saying because they said that, once you’re debt free, you have no bills to pay. In addition, most of the people who posted some comments mentioned about the house which they considered as an investment which is somewhat true if you sell the house and keep the money but you’ll lose the house 😂
She said she wants to retire early...but aggressively paying down mortgage delays putting more money into retirement investments to grow. She's a finance professional who makes good money so likely has a low mortgage rate too...why throw all extra money at the mortgage when those dollars can do more invested for the next 7-10 years? Heck even high yield savings is getting more interest than the avg. Mortgage rate from when everyone refinanced a few years ago
Bunch of smooth brains up in here
I don’t understand why you just don’t open up a brokerage account and invest in index fund collecting nine or 10% interest on the next 10 years and use that money to pay off your house.
Because there is no guarantee of return on investment. And you don't seem to understand investing any way as you reference 9-10% "interest".
House. The minute i paid off my house, i learned i can work part time making rotisserie chicken and thrive.
I agree in general that paying off the house is a better option. However, this isn't always the case, you have to weigh what you save by paying the mortgage down as opposed to investing. For example a 15 year loan at 2.5% - should be paid off instead of invest aggressive while the market is down? I'm not sure that makes sense. Again you have to crunch the numbers, and all the numbers.
Paying off the home
Its worse here, our economy is like a flailing fish, fighting for its life. The normal state of the U.S. economy is actually very bad. Because of this it goes into convulsive spasms fighting to grow any way it can out of desperation. Tricks, gimmicks, rule changes try to stimulate the economy and prevent it from falling but they only bring temporary relief to people since, when you factor in inflation we are declining.
Investing is ALWAYS better than paying your house off.
How much is your rent monthly?
funny thing is everyone talking all this making money investing when it is proven only 20 percent make money in the market so get rid of your mortgage first then investments not that big of a deal
❤ you get it. Most people don't even know how to put in a profitable stock options trade. Eliminating debt is their best move
I refuse to keep sharing my roof with the bank for longer than I have to. I'm $65k away from paying off my mortgage, my deadline is Dec. 2022 for a total of 7 years, then I can quit working two jobs.
Well done! Amazing work! All it takes is a little sacrifice to live wealthy for many years in the future.
@@ma93256 yes indeed, my friends think I'm crazy. At least I'll never have to work two jobs again. Thanks for the encouragement.
@@MP-nj1qy your friends are also probably deeply in debt and think that’s normal. Keep doing what you’re doing you’ll thank yourself later.
Use your brains instead of your emotions: a mortgage should cost 3% (if not, refinance!), while a well-balanced investment portfolio should return at least 7%.
That means your emotions are *costing you 4% compound interest.*
@@ma93256 stop jumping to conclusions. They might just know that it's good when investments earn significantly more than (currently super-cheap) mortgages.
I’ve taken steps into paying off my house, I managed to put 60k into it this last year… I just turned 28 I’m hoping to have it paid off by the time I turn 30, I have 98k left to pay with 10k in the bank and an 8k emergency fund… the thought of being able to pay off my home feels so good! Still single, debt free with a job I love (full time photographer)… I moved here from Mexico 10 years ago without a penny to my name, I learned english, made good financial decisions… this is the American Dream🙏🏻
Refinance and invest it lol
@@oshkoshbegone with 7% rates...lol
@@Cwilly13ify I was kidding lol
Way to go
Felicidades!!!
I like this answer from Dave. The question is a lot like asking which pedal is more important when driving a car, the gas or the brake? If you're running off a cliff, the brake. If you're in a good stretch of highway, the gas. Same with finances on the road of life. Apply wisdom and figure out your situation.
Agree 100% The question then becomes... , is it best to be mortgage free OR to maximizing Net Worth.
If you want the house paid off that's a psychological benefit, it's also a better move if you are not doing anything else with the extra money paying the house is good. However, opening up a brokerage and starting up some ETFs is a more optimal move, especially when your returns beats your low mortgage rate.
You don't "open up a brokerage"
Look at your budget with only home insurance and property taxes. Are you able to quit your job or maybe work part time once it's paid? Also, do you like the home and area you live? Paying the house off will give you more options and peace. I love how Dave adds in "Giving like no one else". It's such a great way to live once you are debt free.
this is my goal honeslty. I started to late to be rich when i retire but I sure heck would love to not have to work but for taxes and electricity. be pretty dang nice.
If you don't build up retirement income bc you threw all your money at the house to pay off early...how can you quit your job? You need to save more to male up for not saving while you paid the mortgage off
@@danmzuccari1 my ssi retirement would more than cover my bills. anyway I do not think I will retire fully how boring would that be. I am sure I will work 2-3 days a week for the rest of my life for something to do.
Holy moly. 14k of take home pay a month.
Why is that holly moly? If you invest wisely, that could be you.
@@johnSmith-uz8nl nothing to do with investing! Most don't take home $168,000/yr.
@@tymom9313 168k in Washington DC is more like 100k or less most places. They're middle class.
@@tymom9313 Yes and no.... if you invest wisely, you can achieve that amount... I know because I have and then some. It does not happen over night. To me, it has EVERYTHING to do with investing. Think of it like a snow ball you push down a hill... it gets bigger and bigger and etc... and then one day you are making good money from your investments.
@@johnSmith-uz8nl $14k a month has NOTHING to do with investing! I agree snowball effect with investing!
I lost money investing in cryptocurrency, now my husband wants to divorce me 😭😭😭
Oh my God! My heart is really broken reading this. I can imagine what you are passing through but please don't commit suicide. Everything will be alright.
I feel so terrible about what you are going through. There's a solution to this. And the solution is to get back the money. I will advice you look for a reliable professional trader that will trade for you and help you recover your losses. You can beg your husband to give you some time to raise the money
@@carlosdominguez1697 I am also having the same problem. I have lost all my money trading. Please help with the contact of your trader and God will bless you. I have suffered a lot of losses
@@carlosdominguez1697 Thanks a lot.
@@gatlanahislop1851 Just send him a mail and ask him to trade for you
Paying off a house first means no more interest payments or mortgage.
My mortgage is a 2.5%. My investments are making 12%. Easy decision for me… I actually do put an extra $1,000 per month towards the mortgage for peace of mind however it’s not necessarily finically smart.
@@vasaguy7624 Everyone's a financial guru in a bull market. Pay off your house. Whenever the crash comes, you will still have a comfortable roof.
It doesn’t matter if a crash happens it will come back always has
@@truckingmoney485 agreed. Question is: will you have a job to pay for your roof during the period of the crash?
If you invested instead of paying off, you lost half your investment (40% during the recent flash crash), and got laid off... Congrats, you lose your house. Happened to many in 2020, happened to lots more in 2007-2010.
Greed and hubris are poisons worthy of being avoided.
Edit. People didn't learn a thing from 2007. Y'all keep trucking along, I'll be paid off smoking cigars in the yard in peace with no worries.
@@LovesGrilling that’s what your emergency fund is for. Paying off your mortgage shouldn’t be your top priority. Doing that could cost you millions.
Invest if you actually want to be wealthy. House if you want peace of mind.
paying the house off early is a literal guaranteed return on your investment, opposed to stocks where nothing is guaranteed. you will save money on interest (possibly six figures) which is the same thing as making 100k....
@@Silidons91 There is no possible argument that makes paying off the house a better investment than investing the same money in index funds. It's math. Only advantage is mental, but that could cost you millions in the end.
@@mastermind6767 says the guy who probably has pennies in their account.
@@mastermind6767 here's an argument: tax free, guaranteed returns. i'm set to save almost 100,000 over the course of the next 10 years just by putting an additional $500 payment each month on my mortgage.
and that's on top of investing.
@@Silidons91 have you calculated the same if you invested an earned the 7% average annual return on that $500/month after inflation in the same timeframe?
The Dave Ramsey privileged daughter's opinion show. Nepotism on steroids.
$58k left…. I’m giving myself 12 months and “She gone!”
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
Let's see. investing means losing about half your money. No mortgage means saving $500-$1,000 a month in interest.
Our mortgage is paid off but I still have to set aside $500/month just to cover our property taxes and homeowner's insurance -- which is kind of a bummer, but that's life.
More like $1100 mo just for pita for me. Ouch
@@dhammer6715 time to sell !
What was your payment before pay off ?
@@carlostosado8965 just built….lol…I’m a glutton for punishment. Good news is that I just learned today my social security will pay out almost $60k/yr when I turn 67. That will easily cover my nut and then some in retirement. So, I get to stay in my overpriced home.
Yeah my property taxes have pretty much tripled since I bought my house. Same with insurance.
Everyone hates inflation but are happy when that $200,000 house they bought sells for $400,000. If housing cost rise with inflation all you are doing is breaking even minus the interest you paid.
Wanting to pay off my house is making me look for additional income opportunities I otherwise wouldn’t have due to comfort with a 30 year mortgage. I would not work all these side gigs just to invest the money. I know this because I didn’t do it until I had the goal for my “forever home” pushing me to want to earn more. I’ve almost doubled my salary in a few years just because I want to pay off my next house fast. I also invest still. It’s not (all) passive income, but it’s so rewarding.
What types of things are you doing to add income?
Does anyone on this show ever question...What's your mortgage interest rate? There are alot of people with mortgage rates just over 2% and CDs are well over 5%. If CDs continue to rise, paying down your mortage will be a very poor decision.
Your living in the dark ages. It's not rocket science. Make your $$$ work harder for you. 3% Mortgage or 10%+ returns on a given investment, or S&P 500
Hope whoever is reading this accomplishes financial FREEDOM, wealth, and is blessed with true happiness!
Investing should be the #1 priority. the math over time would always favor investment over paying off a 3-4% mortgage
Lol Ramsey literally shows how to be poor
Every situation is different
You are forgetting the ‘risk’ factor here.
I fear you are not feeling the risk.
I feel it everyday therefore I only do 15% to Roth’s and the rest to housing.
@@harryl7946 your putting yourself in more risk by locking your cash behind a non liquid asset that you can't access unless you sell or refinance. Have an emergency fund and then invest as much as you can.
@@aaront936 You forgot, or get foreclosed on. Your advice is ridiculous, Where's your talk show buddy?
Paying off that 3% mortgage or make the 27.6% I made in that money this past year hmm
Paid off the house just over 4 years ago. The "mortgage" now goes into investing. Peace of mind and increasing wealth at the same time.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
@@KcZyro - Rubbish - you're a scammer. I already have proof. Took me 2 minutes to figure it out.
We’re at this same level. We struggle trying to find a compromise between paying off the house and saving for business/retirement investments.
My opinion is if you have an interest rate south of about 3 percent invest unless your mortgage is gonna take u into retirement years otherwise I would put enough extra towards the mortgage to pay it off right before you retire.
If you have issues saving, it is cause you bought to much house. At the same time that could be a good thing... cause you house is worth so much more today. But... it hinders your investing.
Homes in San Francisco average $1.6 million to $2 million for a normal house. Taxes and cost of living here are high as well. Being able to save for retirement, contribute to 529 plans and take a vacation once a year is difficult. According to the retirement calculators, I will need approximately $3 million to retire comfortably. In order to reach that goal there is not much leftover to spend if you are constantly saving. I am a little behind after the stocks dropped over the past year.
I am 56 retired and pulling $93,000+ a year the only thing I am focused on is paying off the last 65,000 on this house.
AFTER it is paid off I will throw that extra $5000. a month into mutuals .... I prefer the security of a paid for house.
Amen. Life changer at that point, I can't wait to get as low as you are!
If you’re retired, how are you making $93,000 a year?
At 56 that's totally fine. Completely different story for someone in their 30s or 40s.
@@wetwilly420 probably pension. If it was invested he’d need to have 2.5 million to perpetually withdraw 100k every year without losing the principal. 65k is chump change if you have 2.5M.
Nice video, please who can suggest for me a good way to make money.
Another wife who wants to retire early while her husband continues to work.
I see this all the time wives quit their jobs as early as possible and put the load on the husband.
I do not think women realize the pressure they put on their husbands.
I lost over $60K when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I find one source to recover my money, at least $9k profits weekly. Thanks so much Mrs Gretchen Dougherty
Wow, amazing to see others trading with Ms,Gretchen Dougherty, I am currently on my 5th trade with her and my portfolio has grown tremendously.
l also invest with mrs Gretchen Dougherty, she charges a 20% commission on the profit made after each trading session, which is fair compared to the effort she put in to make huge profits.
This is not the first time I am hearing of Mrs.Gretchen Dougherty and her exploits in the trading world but I have no idea how to reach her..
My first investment in mrs.Gretchen Dougherty gave me the confidence that led me to invest without fear of loss. I have already taken 3 of my friends to their guide and they are fine.
She's available on
I am regretting not investing in stocks ever since but still grateful i kept money in the money market. With about $200k maturing soon, i plan investing in the stock market. What stocks should I look into as a newbie to safely grow my money?
Thats when you hire someone to manage your money. You need a (CFP) straight up! personally, I would invest in ETF's and also love investing in individual stocks.
I took charge of my portfolio but faced losses in 2022. Realizing the need for a change, I sought advice from a fiduciary advisor. Through restructuring and diversification with dividend stocks, ETFs, Mutual funds, and REITs, my $1.2M portfolio surged, yielding an annualized gain of 28%.
Your advisor must be really good, how I can get in touch with them as my portfolio isn't doing well.
Whitney Kay Stacy is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.
Remember to follow the baby steps... You pay off the house early while investing 15% for retirement in the background! Do not become so focused on paying off your house that you neglect saving/investing. You cannot get those years of compounding back.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with WHITNEY KAY STACY for the last five years or so, and her returns have been pretty much amazing.
wow $14,000 a month i could live like a king on that compared to what i have.
Both also depends where we are in the market cycle. As of 2022 I would focus more on the house. As prices come down on everything as we are in recession mode focus more on investing.
I’m maxing out my Roth 401k and Roth IRA, the rest on the house. Goal is to make my final house payment on my 35th bday in 2026
You don't become rich by paying off low-rate debt, but by making high-return investments...the debt doesn't compound but the invested amount does.
its a matter of the heart...not math. debt free gives you more than just money. Put all your cash on investments once debt free. ( that plan will win every time ). Listen to Dave a bit more. cheers
@richlarson6876 I see no one told you that you are 100% correct!!!!!.
Then why is the average millionaires home paid off in under eleven years?
The debt doesn't compound? Uhhh.
@@drhoughton5481 If you lose out on investing the first five or ten years of your career because you are paying off that mortgage early, you will have lost 100s of thousands if not a million for your retirement.
You throw everything at your 30-year mortgage and don't look back.
The interest is a killer over the years.
If she is in finance, she should know the smarter play is not to pay down the low-interest mortgage any faster than she has to. Investing is the way to go. Let your investments pay off your house 3-6 years down the road if you really want to pay it off. The probability is higher you will both pay it off faster and be wealthier in the long run.
hi can you tell me more about this? it seems this makes more sense than what Dave is saying
@@dembenonsgals1321 Hi, sure! It's all about the cost of capital and where you expect the best returns over a particular investment period. There are no long-term periods where the S&P 500 have not beaten a 2.5% mortgage, net of tax benefits. In all 15-year scenarios, you'd pay off your mortgage faster if you just invested in the stock market and paid off your house when your portfolio balance equals your mortgage balance. And once you have enough wealth where you "could" pay it off, you will probably realize that you'd rather keep the safe and cheap 2.5% mortgage debt as long as you can while you let your portfolio continue to compound at a rate much higher than 2.5%.
Paying off your 2.5% mortgage directly will still lead to building wealth, just not nearly as much.
@@CalmerThanYouAre1 I learned this at 27 years old when I bought my house. $220,000 mortgage, 3% interest. I chose to max out my Roth 401k in and S & p 500 index fund instead of paying the mortgage off early. By the time I’m ready to retire I’ll just write a check for whatever is still owed on the mortgage, and I’ll hopefully have several million dollars leftover to retire on.
Thie caller makes $14,000 monthly. I am pretty sure she can invest and knock out the mortgage. Many with no consumer debt can do both at the same time. Also, failing to add risk into your mathematical calculation is a flawed concept.
@@jaywalk6628 risk has been accounted for. She has a higher risk of missing the upside than going bankrupt due to the downside, in her situation. The “what about risk” mantra typically only argues risk from one side and doesn’t account for the true cost of capital and how the individual is positioned financially. Psychological factors than can’t be quantified are also important, and should be considered. But risk tolerance isn’t the same thing as risk capacity. And the probabilities for success are based on actual data, not subjective assessments of perceived risk.
Everyone should do what they are comfortable with, but I’m very happy I have held onto all my 2.5% mortgages and chosen to remain invested in additional appreciating assets instead. Achieved FI faster ✅. Net worth higher ✅. Diversified income streams ✅. Risk much lower ✅.
I agree. Paying off the house is a type of investing.
Investing at 4% interest.
You’re wrong though
A very poor investment. But sure you're saving 3% in interest instead of earning compound interest of 10% +
@@aaront936 10% is usually not guaranteed.
@@aaront936 wait of one pays a 30 year mortgage in 10 years they save the 3 percent for 20 years AND are able to invest the entire amount after the 10 year repayment. That seems like 3 percent saved plus 100 percent to invest after 10 years.
The more affordable the house, the quicker we can finish paying for it, and more quickly build that massive wealth
Thanks for your comment, Kindly reach me out
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H…M…U…+ 𝟷𝟽𝟷𝟽𝟺𝟽𝟹𝟿𝟺𝟹𝟾.._
I really can't say about paying off the house as a priority, but it surely is freeing! You won't know the feeling until you do it. And then you're free to do whatever you like...
It is difficult to make exact projections for the housing market as it is still unclear how quickly or to what degree the Federal Reserve will reduce inflation and borrowing costs without having a substantial negative impact on demand from consumers for anything from houses to cars.
I agree, It's not just the prices, but also the increasing interest rates that are making it more difficult for people to afford homes. With a good FA you can make up your portfolio.
Agreed. I deal with an investment advisor for this reason. I currently have over $800k invested in a diversified portfolio that has grown exponentially and is suitable for all market seasons. Our current project for this year is a more concrete ballpark target.
How can I participate in this? I sincerely aspire to establish a secure financlal future and am eager to participate. Who is the driving force behind your success?
Monica Shawn Marti is the licensed advisor I use. Just research the name. You’d find necessary details to work with to set up an appointment
I appreciate it. After searching her name online and reviewing her credentials, I'm quite impressed. I've contacted her as I could use all the help I can get. A call has been scheduled.
If you're young enough, investing can be the better option. "Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn't, pays it" - Albert Einstein
That’s why banks give mortgages.
Yup, when you pay your mortgage, you're paying compound interest.
If we are being honest with ourselves, taxes may be a major pain, just like they are for the wealthy. Taxes on income, goods and services, real estate, etc. It's wonderful to pay taxes, but we may also establish our own tax havens. Since stock market appreciation is not taxed, I personally invest most of my money there. When I sell, though, I discover ways to make the profit tax-deductible. I’ve been sitting on over $745K equity from a home sale and I’m not sure where to go from here, is it a good time to buy or do I wait?
(I find it upsetting that such basic concepts are not taught in schools, yet people constantly whine about taxing the wealthy as though they should be made to pay for their own ignorance. I have been utilizing the market to insulate myself from the market, doing the same thing. However, because I detest making routine decisions, I just invest through a financial advisor, earning decent returns and avoiding taxes with minimal effort.)
@@MrGravity304 I've been doing this same thing myself. Can't get into trouble with the IRS when I have no income and all my money is in stocks. I don't like doing the work though. Lol. So I just invest through an advisor who does the stock picking. My money grows, and I'm tax-free.
@terrygeorge3545 I can honestly relate. It's not as easy as it may sound and requires some sacrifices but it is definitely rewarding. I don't know if I am permitted to go into details here, but her name is NICOLE DESIREE SIMON. Was in the news a lot in 2018. You may look her up for more.
Did I hear that right - they make 14 GRAND AFTER TAX PER MONTH and she is seeking financial advice about a 300k mortgage???
Yeah talk about not even first world problems
How would be absolutely ecstatic to make even a third of that amount per month living in mississippi.. Seeing as how I am debt free and on baby step four
Paying off the house is safe, but safe won't make you wealthy. I'm ok with the bank holding onto my debt for now while I invest. When the time comes, I will pay the house off all at once, but by paying the house off early, you're losing so much compound interest that you will never get back.
It appears you are unaware of the compound interest from the mortgage debt. Also unaware about tax from investment earnings vs extra repayment. You also can not be wealthy when compound interest is also against you.
@@Bobotheclown98 10% growth in the market beats sub 3% mortgage debt. Ramsey will costs you hundreds of thousands of dollars if you follow his baby steps.
@@Bobotheclown98 mortgage debt doesn't compound. You don't understand compound interest.
@@TheCanineclub At less than 3% interest, it makes no sense to lean into the house. Over the long run my investments will make anywhere from 7-15% interest. Compound interest only works if you're investing regularly. You're wasting valuable time when you're trying to clear your mortgage. I'm not the only one who realizes this, it's a very common mindset when it comes to investments.
@@TheCanineclub I guarantee I'll come out ahead.
I recommend diversifying your investments by considering stocks alongside real estate. During a recession, there are potential buying opportunities in the stock market if approached cautiously. Additionally, market volatility can offer short-term buying and selling opportunities. However, please note that this is not financial advice. It's important to be proactive in investing as cash may not be the most advantageous option during these times.
You’re right! The current market might give opportunities to maximize profit within a short term, but in order to execute such strategy , you must be a skilled practitioner.
A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.
I sincerely aspire to establish a secure financlal future and am eager to participate. Who is the driving force behind your success?
WHITNEY KAY STACY is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
Look at your amortization schedules people
I can't wait till I have this problem. I'm still on baby step two but moving sooo slow
Keep it up! Don’t stop!
Don't give up your company's 401k match. It's a guaranteed 100% return on your money. That beats even the highest credit card interest rate. Look up the financial order of operations.
It’s so crazy to me how much income people that call into dave Ramsey makes.. me and my hubs work full time jobs and clear 40,000.00 per year…. These people make 3+ times what we make, it’s crazy, how the heck can they be in debit, and not have house paid off…..
I invest more than 15% even though I still have a mortgage because it's fun and that's what I do for enjoyment. Boo-yah, baby steps.
Dave would be disappointed
Dave's a boomer with advice that hasn't even kept up with inflation.
Paying off a house isn't important. Unless you cannot afford payments at retirement. The best answer would be. Wherever you get the most for your money. If paying off the house. Makes more sense by saving interest. Do it. If your investment will outpace your interest. Do it.
Great video. I like breaking down intensity vs intentional
If your investing or paying off the mortgage early either way your onto a winner so give your seleves a break guys its like debating what apple or samsung to get
Paying off low interest debt is usually a poor use of capital. It is a peace of mind move.
No one has answered this question yet. If you say you would rather invest than pay off your mortgage, is that the same as saying I’d borrow against my house and invest the money?
yes
I was dead set on paying my house off.. not anymore.. I’ll take the 10-15% investment gains vs paying 2% interest every single year
If your towards the end of the mortgage then yes because you already paid all the interest up front. Otherwise no.
@@raulfernandez9111 agree
Sounds easy but I remember (felt) every market crash since the 70’s. They can leave some ptsd about investing in the stock market. Dave is cocky about the market because he makes millions in income. He could retire well just by putting some of it in a Money Market. Maybe pay a little extra on the house to time it being paid off at retirement, and invest the rest in the market?
@@dhammer6715 i haven’t been around that long, but I did feel 2008-2010 drops. 2020 was big, but I’ve more than doubled since the 2020 drop because I was so aggressive last year. Dave’s answer is so black and white. Its not for everyone
However you do it, just make sure you're maxing out your Roth, PERIOD
Mortgage rate costing me only 3.5%…investments earning 10%…
Sad he didn't talk about the math....with the interest rates today home loans pay you if inflation is over your rate
I’m in Oz… this is my situation
Mortgage loan $411000 at 6.59% Pa
With 30 year loan I pay about total interest $800000
If I pay loan off in 5 years I can pay 1/10 the total interest - only $80000
Simple math…
Then after owning the house I get passive rental
Agree. Let pay it off in 5yrs if you can. It likes earn $700k in 5yrs. Better than any risk investment now. My case is $170k at 7.5%. With 25yrs pay about $400k.
Do not waste your peak compounding interest years of your 20's and 30's paying off 3% low interest mortgage debt. Put your money to work and get your army of dollar bills working to make you compounding growth.
What a 🤡 instead of your measly 10-15% investment while holding onto a mortgage you could be doing literally 50-60% when you have a paid off house. You’ll have stacks of cash at that rate
I follow the Dave steps, and you need to consider your own individual circumstance. If you deviate from the steps, be accountable and open to others so if you go in the wrong direction then you will know and then you Must return to Dave's steps. We are on plan to pay off mortgage in 8 years (10 years on a 30yr loan) but investing the rest instead of paying the mortgage off. This is because we are paying off AND making more money than we would if paid to mortgage (2.5%). BUT if we start running into problems, then we are going back to paying off the mortgage. Be accountable.
Generally. if you under 45 and the interest rate is below 5% invest extra and make minimum mortgage payment. If you’re older, it could be more beneficial to pay off the mortgage. However, every situation is different so it would be foolish to use Dave’s one size approach.
I can wipe my house out no real other debt but kill my 401k but can afford put same my house payment is in savings etc plus I do 20%401k about 250a week I am 43 my only bills are utilities or like 500card debt paid clear each month to build credit only reason I got it
For anyone under 40 (likely even 45), you are much better off investing any extra money rather than paying off a low interest rate mortgage. Paying the mortgage first only prevents you from growing your wealth and robs you of the largest parts of compounding results in the future.
You just want to pay off that mortgage before you retire an the income slows or stops.
Exactly I always say any type of interest payment below 5%, can literally be put on hold as long as you're taking your extra money and putting it into investments. Yet If you have lot s of loans it's not worth keeping all of that baggage take care of some of the higher interest rate ones a mortgage or maybe two car loans is fine but if you've got a boat loan and another mortgage loan and blah blah blah blah yeah you should probably cut some of those down
@@kartboarder22g17 - I agree. You want to avoid consumer debt. As for additional mortgages, depends what it happening with those properties and the rates as well. But a boat loan would be similar to a car loan and is consumer debt.
Now be careful, when you suggest getting rid of the higher rate loans, that is the so-called avalanche method (the CORRECT way to get rid of debt) and Dave doesn't like getting rid of debt faster and at less costs. He'll insist you use the SLOWball-snowball method!! Don't be too smart, Dave doesn't like that! I'm telling you that you're right....but watch your step on this channel. Lot of blind Ramsey disciples.
@Mr. Nielsen PE - You couldn't be more wrong. And Dave Ramsey is absolutely wrong on this issue when he advises it. It's false deductive reasoning which he usually bases on study of people who are ALREADY millionaires.
First, I said you want to have it paid off before you retire. Sad you made that sad attempt to make a moot point. Second, you REALLY need to think through your math and more importantly you need to learn about COMPOUNDING.....especially the effects it has in later decades. By focusing on ridding your low rate mortgage earlier in your life (over investing) you have STOLEN one of the largest part of your future retirement funds. You robbed yourself simply to pay off a home that is worth the exact same amount in the future regardless of when it was paid off.
Also, I'll add that if you focus on investing first, not only will you have the money to pay off that mortgage throughout, if you ever needed or wanted, but you'd also most likely have it sooner if that was your goal (but then would likely be more aware that you do not want to do it).
For what you said in your reply, you really need to learn about compounding. You obviously don't understand it or the mathematical effects to claim it's not logical. The math and the logic say take your time with low rate mortgages and invest, invest, invest. It's only the psychological reward (which Dave loves to focus on) that has any merit at all. But that psych bump comes at a tremendous cost to yourself as it takes from your potential future and earlier financial independence (which you don't have simply because your house is paid off).
COMPOUNDING - learn it inside and out!!
@@tomm8025 you are forgetting that once the house is paid that large amount can be invested and the person is investing some while paying off the house.
@@helainehoerning2200 - I repeat, LEARN ABOUT COMPOUNDING! Those early years when you're wasting your money paying off the house rather than investing are the years that would have the biggest effects of compounded results....but instead you LOST those results just to pay off a low rate mortgage on an asset that will be worth exactly the same whether you paid it off now or 25 years from now. Also, learn about the deflation value of future monies and think about how you'd be using less valuable future dollars to make that same payment rather then the more valuable dollars now.
Ramsey is completely wrong in this area. Not even a debate. Numbers don't lie, but people can try to skew the data, or in his case make psychological arguments to defend his position. He is beating the same drum he was 30 years ago....back when rates were much higher.
If interest rates on mortgages were higher, say even 6%, now we can discuss which is better. But at rates today, not even close. Focusing on paying off the house early will cost you a fortune in lost future monies.
If you already made the mistake because you listened to Ramsey, don't calculate how much you COULD have had, cause it will make you sick to know what you did to yourself.
Invest into more rentals, leverage debt and buy more units as they start appreciating. Growing your rental portfolio is the best thing you can do.
With her income, this lady needs to be talking to a real financial advisor / CPA rather than a radio personality. This couple is in the 24% tax bracket federal and 8.5% Washington DC. The smart move would be to max out their 401k contributions to take advantage of the tax deferments (note: there are income limitations that may apply). Put another way, why pay 32%+ on your money to pay off a 3% mortgage.
I’m convinced by now Dave knows his baby steps is flawed after the individual gets their debt under control. He just can’t amend it because then it would be an admission of a critical and embarrassing flaw with his signature plan. He’s more interested in staying oblivious and wrong than doing what’s right for his audience.
For such a religious person he sure doesn’t seem to have any guilt ruining his audiences future for his own personal gain.
@@Omikoshi78 I agree.
You can easily do both.
Depends on your interest rate. If you were fortunate enough to lock in at 3% a dew years ago, invest.
The path to paying off the mortgage early is risky too. A paid off house isn’t helpful until it’s 100 percent paid off. Invest the extra money and then when your ready to retire just cut a check to pay off the mortgage. That way you also preserve your liquidity along your path to paying off the mortgage.