Is a 15-Year Better Than a 30-Year Mortgage?

Is a 15-Year Better Than a 30-Year Mortgage?

[djtruedomination]

15 year for me is the way to go. Live frugally and still save money.

[Austden]

You guys have literally changed my life. Before finding your channel a year ago I was SO stressed about money, was only focused on paying off student loans, didn't have a Roth IRA or a house. Now I have doubled my retirement savings, bought a house that I rent part of it out and don't sweat about the low interest student loans I still have. Much healthier spot financially and more important.. mentally. Can't thank you enough.

[ClintPenrod]

I got my rate down to 2.75% a few years ago by going down to a 15 year. I couldn't pass that up even though I wasn't hitting the 20% savings rate. I am now over 20% savings rate and will be debt free by 43 years old.

[karaayers]

15 year is the way to go. My home will be paid off in 6 years when I'm 42. Then probably rent it out after we build on our land in the county.

I have never known a person who saved extra $ in an account and truly used it to pay off a house by writing a check. Murphy and stupid tax always ate it. They sure had no problem paying the car note or credit card, but never really felt the desire to truly save. They treated the house payment as nonchalantly always there. This is why the shorter mortgage term wins.

[j.chrislowe]

15 years makes total sense. Especially if it means going into retirement without the weight of a mortgage.

[Bonez]

Why doesn't anyone ever talk about mortgage payoff increasing the efficiency of your dollar? What I mean is this: tax brackets are highly progressive, for example the fed brackets have deductions and credits that can keep you in a 0% tax rate... And then move to 10%, and then 12%... and then WHAM. 22%! Instantly nearly doubling that 12% rate, and I know in my State where I pay a local and State tax on top of federal taxes... Same thing, very progressive brackets.


By paying off the mortgage, I was able to increase the efficiency of my earned dollars. The $1, 000 that I had previously paid to the bank I no longer have to pay. That effectively allows me to earn $1, 000 less (which will be taxed at a LOWER rate, because of the progressiveness of the brackets... allowing me to actually KEEP more of the money I earn after-tax), and still maintain the SAME quality of life. This manifests itself in my wife retiring from her job, me cutting down on overtime and an actual increase in quality of life for the entire family.


The benefit of cutting the mortgage expense from our lives has been huge in effectively making our earned dollar worth more after-tax....

[fantasyrookie]

@TheMoneyGuySHow, can you guys revisit this video now that interest rates have increased?

[skylinec]

Encumbrance. Yes.

I have a 5 year car loan at 0%. I have a friggin mattress loan for 3 yrs at 0%. I still get uneasy at the thought of owing the bank monthly payments and possibly screwing up the payment schedule and then subject to penalties.

Payments are all automated. I have enough to pay everything off at once. But even tho I know this is the “right” way to play the money and interest game, it’s still a mental burden.

[fataznboi]

30 year mortgage due to inflation inheriting lowering payments and opportunity cost of investing the difference.

[ZXC_ZXC]

Get a 30 year mortgage but pay it off like it was a 15-20 year term. Then you have flexibility.

[joshuaschlies]

So I’m guessing that as of today 1/17/25 you would say 30year fixed swing as rates are 7% and higher.

[mecheckraise]

Funny the take was not that you bought a $500, 000 house at the wrong time for it to be $270, 000 a few years later. You seem to say you could not control buying when the market was high like you had no choice. You did. It was something people should try to avoid. I have bought most all of my houses as distressed foreclosures. When there are no genuinely good deals then don't buy.
Warren Buffet has a hoard of cash because he thinks prices are too high. He does not care what others are currently valuing business. He says there will be a day when they are cheaper.

[ahumm]

A 30yr makes sense when you have other debts and allows you better flexablilty. 15yr is great for when you have little to no other debts and allows you to pay down faster without having to throw extra payments. But its always good when you can! 😊

[the_LuckyPenny]

Are we there yet? 30 year mortgage are now around 7%, so time to switch?

[richstorey]

Why not recast your mortgage to about 200.00 a month and having an escrow placed on the account make them take care of paying the taxes and insurance?

[michaelsenko]

Whether you have a 15 or a 30 year mortgage, you can not stop investing. IF you were out of the market in 2019 you would have missed s 30% return. That is the opportunity cost you always have to factor in when stop investing.

[dute]

Historically low rates, but don’t think they can’t go lower! Many countries now have negative real rates and some have negative NOMINAL rates!

[wd]

I think it's good advice but I would at least avoid the costs of PMI, because that's every month of extra money not going to principal, and I would avoid the costs of refinancing to get a lower interest or to spread out payments futher. Am I wrong in my thinking?

[UltimateTexasHoldemGuru]

15 year is ABSOLUTELY BETTER for most people. My house was paid off at age 42. Debt free for over 5years. You build up equity with a 15 yr SO MUCH faster vs a 30 yr so if you have to sale your house you will lose less/make more vs a 30 yr.

[desiv]

While I totally accept the fact that the numbers say 30 year and invest the rest of the money. I know the math works...
But I refinanced my first house to a 15 year after a few years, and once it was paid off, I felt SO MUCH PRESSURE lifted off of me... Whatever else might happen, I owned my home...
Yeah silly, but I wouldn't go back and change it...
When we rented that home and bought our second home, as soon as I could, I went for another 15 year loan (and got lucky with a great rate). I don't regret that. Even tho I know the math says otherwise....
I was never good at math anyway. ;-)