Quote:
Originally Posted by TboneS54
But if you invest the differential into stocks, you'll make much more than $25k in 15 years.
With rates this low, a 15 year is not worth it. Do a 30 yr and grow your stock portfolio simultaneously imo.
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You would likely come out ahead but things to consider
You are talking about a guaranteed return on the reduced interest to a higher risk return on the stock market (should happen but no guarantee). There's a reason people invest part of their money in less risky places than the stock market.
Whatever you make on the stock market gets reduced some amount with income taxes.
The 15 year payment is required, how likely are you to invest this extra and not spend part of it. For most I think the idea that they will save/invest what they always have, then always put this extra into savings is unlikely (when you want "X" you just skip the extra savings).
The mental side of it. I am now half way through my 15 year mortgage so 7.5 years to go. I am very happy I am not looking at 22.5 years left. I actually have about $100k left on my loan and while not the best investment I am considering paying it off sooner. At that point I wouldn't owe anyone anything and I like this idea a lot.