A number of years ago, my hubby and I decided to buy a house. We found the perfect house for us. When we bought, we told ourselves that we would have the house paid off in 5 years. Our friends laughed at us, our accountant laughed at us, and no one thought we could accomplish what we had set out to do. No matter, we had our home paid off in just over four years. No it was not because we were rich, it was because we put everything into paying off our home. We did not eat out much, we curbed our spending, and we did what we set out to do.
If you have an idea, no matter what, follow it though and you can accomplish great things.
Read feedback for this post below. Click here to post feedback.
I wonder if Henry would post differently now? All I know is that as TXBetty wrote-owning a house isn't always a good tax write off.
Financially, nothing, and I really mean nothing, feels as good as knowing the house is paid for! Best sleep aid I know of:)
This is simply a no brainer; pay off as early as you can and keep your own money. IRS is not going to give anyone anything unless you have tons of itemized deductions which most of us don't have. I've bought several houses in my lifetime and never did come out ahead with IRS because I didn't have enough to itemize.
I have to rent out two rooms just to make up for my loss of income. I don't use my entire house, so this works out and enables me to barely cover my mortgage. I live in a very high cost of living area. Everyone has different circumstances. I would dearly love to be free of my mortgage! I may have to rent out another room to achieve that sooner.
Way to go Karyn!! I'm from Ottawa too; thanks for the inspiration!
Henry_P, what you fail to recognize is that Karyn is from Canada, and in Canada our mortgages are not tax deductible like they are in the US. In addition, no matter the country in which you live, when you pay off your mortgage you save untold hundreds of thousands in mortgage interest. In addition, today Karyn has no mortgage at all, so in addition to having a higher net worth than someone who still has a mortgage and will forever owe on their home, the money that used to go for mortgage payments can now go to either acquiring another property or simply enjoying life - mortgage free.
In my opinion, no matter which country you live in, freedom is the name of the game. Don't be blinded by incentives that the government gives you to stay in debt.
Henry you are SOOOO wrong.
The scenario you describe is only good if you accept being in debt forever and working to stay in debt forever.
ANd stock portfolios are risky to say the least.
I have paid off two mortgages and stashing everything I can for an early retirment. It won't be long now. ;)
I'm with Walt and Karyn... pay it off get out of debt and kiss your job goodbye!
There is also an intangible value - "We don't owe anybody anything". That's one reason we paid off our house. The other is not being slaves to the credit industry.
Congratulations but it is kind of pointless without putting it in context. Anyone can buy a cheap house and pay it off in 5 years, it all depends on the relative amounts. How much was the house relative to your household income. Was it 2x, 3x, 4x, 5x, etc. your household income? What percentage of it did you put down? If you make $100k per year and buy a $200k house it is extremely easy to pay it off in 5 years. If you make $100k per year and buy a $500k house it isn't.
Also, this is not a wise financial decision in most cases. If you lock in a good mortgage rate (and rates are low these days) then why would you even want to pay it off early? Especially considering that on top of the low rate you get a tax deduction. I pay 5.75% interest on my mortgage, that comes out to about 4.3% after taxes. I make more than 4.3% on my CDs in the bank, and in a diversified stock portfolio you would average over 10% per year over several years.
So buy paying off your house early all you did was lose money. Plain and simple.
Way to GO !!!! We can do what we put our mind to. Sacrifice a short time and reap the benefits for a long time.
Add your voice to the conversation.